Altron reports solid results, raises dividend

Altron, a JSE-listed technology company, announced its financial results for the year to February 2022, showing that revenues grew 5.7% to 7.9 billion rupees while operating income grew 34. , 2% to 498 million rupees over the previous year.

It comes when the group has reported several notable “victories” throughout the year.

Core earnings per share gained 37.8% to 51 cents per share, while normalized core earnings per share gained 82.9% to 75 cents per share.

Altron declared a dividend of 30 cents per share, an increase of 100% year-over-year.

Group outgoing chief executive Mteto Nyati, presiding over its final streak, said the company achieved a solid performance, even though the financial year 2022 was difficult due to the prolonged Covid-19 pandemic. global shortage of electronic components and a significant reduction in capex by large corporate customers.

“This performance was possible thanks to the resilience of our proprietary platform segment characterized by high revenue annuities, the turnaround of Altron Karabina and Altron Managed Solutions, exceptional performance of Altron Arrow and a strong focus on cost reduction at the core,” he said. Nyati.

The proprietary platform recorded revenue growth of 6.2%, up to R2.9 billion, while operating profit of R546 million exceeded 16.9% the previous year. This is due to the earnings of Netstar, Altron FinTech and Altron HealthTech.

Netstar’s turnover of R1.7 billion was an increase of 7.8% over the previous year. Buoyed by good performance in Australia, South African activity continues to stabilize operational problems that put pressure on subscriber churn rates over the period.

Altron FinTech’s revenue of R854 million exceeded the previous year by 4.5%, while operating income of R193 million increased from the previous year by 43%. “This profitability was aided by the addition of two new insurance products, funeral and life credit coverage and short-term transitional financing for our microfinance clients,” said Altron.

Altron HealthTech increased revenues by 2.9% to Rand 323 million year-on-year.

Altron 2.0 progress

“Our company is making good progress in creating Altron 2.0 by divesting high-capital, loss-making businesses and acquiring assets in high-growth market segments,” Nyati said. As a result, Altron 2.0 aims for high annuity income and a net debt / EBITDA ratio of less than one, among other metrics.

It seeks to achieve these through the fact that Altron is low-cost, owns its own intellectual property, and provides differentiated offerings in cloud application development, security, data and software.

During the year under review, Altron acquired digital security firm LAWtrust to strengthen Altron Security and finalized the Altron Document Solutions sales process to BiAfrica. This transaction is pending Competition Commission approval. It also sold Altron People Solutions business process outsourcing unit to ISON and Altron People Solutions’ learning solutions business to LRMG.

Other achievements during the successful implementation of Altron 2.0 include the reversal of Altron Karabina and Altron Managed Solutions, Altron Arrow becoming a half billion rand company, Altron Nexus collecting over Rs 900 million in debt, mainly from public sector due to the COVID -19 pandemic – and the costs of the headquarters have been reduced by 98 million Rand.

looking forward

Altron said it expects continued pressure on the supply chain and pricing due to component shortages globally. However, the resilience of the Own Platform segment is expected to continue into the first half of the year 2023, while Altron FinTech expects strong performance at the start of the new financial year.

“Within the Digital Transformation segment, a strong focus will be placed on Altron Systems Integration’s turnaround to improve its performance. The segment will be strengthened by the performance of Altron Security with the addition of LAWtrust. Altron Karabina is expected to continue its strong growth trajectory against the first half of 2022.

“At the same time, Altron is in advanced talks with a potential buyer to acquire the banking business of Altron Managed Solutions as it moves towards its strategic goal of being a low-power organization.”


Reading: Mteto Nyati resigns from the role of Altron