[DATA MST:Mustek Limited] is South Africa’s largest assembler and distributors of personal computers and complementary ICT products.
“We are delighted by this set of results for the financial year ending June 2014. At the beginning of the financial year, we set out to deliver revenue growth, to maximise our operational efficiencies and to secure competitive, sustainable margins, while continuing to expand on the diversification of products with growth potential,” Neels Coetzee, financial director of Mustek, told cnbcafrica.com.
“I believe we have achieved these goals, and I’m especially pleased that our sales team have managed to improve our Gross Profit percentage from 13.5 per cent to 13.8 per cent, after a declining trend in recent years. All in all we’re happy to report back on a solid performance from The Group.”
Growth is mainly attributed to an increase in demand for Mustek’s Acer, Lenovo and Asus product ranges.
Mustek said that desktop computer sales have increased due to greater demand for larger and more powerful processers, specifically among corporates, as sophisticated tasks cannot be accomplished on tablet devices.
Headline earnings per share rose by 38.3 per cent to 100.72 cents while net asset value per share grew by 12.7 per cent to 858.67 cents.
A final dividend of 28 cents per share was declared, a 40 per cent hike from the 2013 financial period.
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Contributions from the company’s associates rose mainly due to an increase in earnings from black owned enterprise, Sizwe Africa IT Group, of which Mustek holds a 26 per cent stake in since March 2014.
On the other hand, Rectron Australia, an ICT provider and subsidiary of Mustek, incurred losses during the year due to legal fees in settling shareholder’s disputes and retrenchment costs. The company also lost a number of distribution rights and had limited access to higher margin products.
During the period, Mustek acquired 100 per cent of the share capital in Taiwan based Mecer Technology through a total investment of 6.6 million rand.
The company added that the first phase of its expansion strategy from an IT distributor to a well-rounded ICT provider is complete and that the company now stocks every level of technology as well as proven branded products.
“Looking ahead, Mustek Limited will continue to focus on growing broad-based distribution, as well as its tablet business, including offerings from Asus, Mecer, Lenovo, Acer, and Toshiba. The company will also continue to invest in key industry partnerships and solutions, exploring opportunities within the security, cabling, volume licensing and networking arenas,” said Coetzee.
(READ MORE: Mustek positive about local tablet market amid strong)
He added that the company expects profit growth with certain products such as its security surveillance solutions, Microsoft Volume License offering and Huawei Enterprise Solutions. He expects tha
“In the 2015 financial year, the Huawei Enterprise division is expected to yield returns and is currently rolling out a project for Zambia Railway Limited.”
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