Motus half year profits up 7% while dividend gets 15% boost

Motus press release

Motus Holdings Limited (Motus) today reported solid financial results for the six months to December 2018 despite challenging market conditions. This was Group’s maiden results as a listed entity having come to market in November last year.

Commenting on the results, Motus CEO, Osman Arbee said:

“In the period under review, Motus recorded an improvement in key financial metrics, while our diversified portfolio and participation across the full automotive value chain provided resilience amid the market deterioration.”

The South African operations generated revenue and operating profit of 68% and 92% respectively, with the remainder generated mainly in the United Kingdom and Australia.

Revenues of R39bn remained stable despite reduced sales volumes attributed to market contraction and the sales mix enhanced by price increases and acquisitions.

The Import and Distribution segment reported low growth in revenue with a 28% increase in operating income. The Retail and Rental segment reported unchanged revenue and operating income while the Motor-Related Financial Services segment reported an increase of 5% and 3% in revenue and operating income respectively. The Aftermarket Parts segment reported an increase of 8% and 20% in revenue and operating income respectively.

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Operating margin improved from 4.4% to 4.7% as a result of: the Importer segment benefiting from price increases; fewer vehicles sold to car rental companies (resulting in higher margins realised on sales through the dealer channel); improved retail execution at the dealership level; and the acquisitions in the Aftermarket Parts segment.

General cost control initiatives also contributed to the operating margin improvement. Management remains focused on financial discipline and cost containment.

An interim dividend of 240c per ordinary share has been declared compared to a prior period (pro forma) dividend of 209c per ordinary share, representing an increase of 15%.

Expectations are that Motus will continue operating in a subdued economic environment with pressure on disposable income remaining in place until the domestic and international economic and political situations settle down. Strategically, however, the Group remains well positioned to maintain its leading automotive market share in South Africa and grow in selected international markets.

Key highlights

  • Revenue stable at R39bn
  • Operating profit up 7% to R1.8bn
  • EPS down 7% to 436c per share, but up 10% to 516c per share on a normalised basis
  • HEPS down 2% to 456c  per share, but up 15% to 536c per share on a normalised basis
  • Dividend up 15% to 240c per share
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