“The group’s exposure to subsidised housing in South Africa will be diversified further through an 812 million rand project appointment in Namibia, the group’s first venture beyond South Africa’s borders,” [DATA CGR:Calgro M3 Holdings] said.
“Further growth into Africa will commence once the group proves its ability to operate beyond South African borders.”
(READ MORE: Calgro M3 expands its African footprint)
The South African residential project developer also indicated that during its 2014 financial year, it had paved the way for its next growth phase.
“[The group] has grown its project pipeline to over 17 billion rand, strengthened and consolidated its balance sheet to achieve the cash flow flexibility required in the integrated residential development environment, and increased its exposure to public sector clients as a result of government’s drive towards infrastructure development,” the company said.
“Accelerated infrastructure investments during the period resulted in margin and cash flow pressure. However, these investments will facilitate sustained growth over the next 24 months. Management is of the opinion that 10 billion rand of the secured pipeline can be rolled out in the next five to six years.”
The company had however, reported a decline in revenue to 784 million rand for the year ending 28 February 2014 from 798 million rand for the same period in 2013.
Operating profit decreased to 52 million rand in 2014 from 89 million rand in 2013 while profit after taxation grew 15.7 per cent from 91 million rand to 105 million rand.
(WATCH VIDEO: Calgro H1 HEPS up 26.96%)
Calgro’s earnings per share and fully diluted headline earnings per share both increased from 71.84 cents in 2013 to 83.16 cents in 2014.
“The size of the integrated and affordable market segment will ensure sustained growth in this segment in the foreseeable future. The group recognises the immense growth opportunities within South Africa’s borders and will ensure controlled growth by only venturing into new provinces when we are comfortable that existing operations are fully operational and self-sustaining,” Calgro said.
“The secured pipeline of integrated development projects will allow Calgro M3 to assist government in its endeavour to eradicate the housing shortage in line with our evolving public-private partnership policy. It is the group’s intention to continually grow the pipeline beyond the next five years while controlling and limiting increases in overheads.”