Afrox reports earnings increase

Gas supplier Afrox has reported a significant 22% increase in its headline earnings per share to 93.3 cents in its half-year results. Matthias Wolk, the Chief Financial Officer of Afrox, discussed the company's performance and future growth opportunities in an interview with CNBC Africa. Wolk expressed satisfaction with the growth, attributing it to improvements in the horquets business and solid growth in core business areas like atmospheric gases. However, he acknowledged the challenges posed by market volatility and economic conditions in South Africa. Despite the uncertainties, Wolk remained hopeful for continued growth in the future. One of the key areas of growth for Afrox has been its operations in other African countries. Wolk highlighted the positive impact of inflation and commodity pricing in these markets but also noted the importance of infrastructure investments for sustained growth. The company has been actively contributing to the mining industry in these regions and expects to see further growth with the improvement of infrastructure. Within Afrox's four divisions, LPG gas has been a standout performer, while hard goods, particularly in the mining industry, face some pressure due to economic challenges. Wolk emphasized the importance of cost recovery and the company's focus on importing, manufacturing, and exporting products in the sub-Saharan region. Despite the mining industry's current challenges, Wolk expressed optimism about potential resolutions in the near future. Looking ahead, Wolk identified LPG as a significant growth area for Afrox, with a 7% increase in volume in the first six months. The company also sees growth opportunities in the atmospheric gas segment, particularly in healthcare and industrial applications like food and beverages. While South Africa remains a key market, Wolk highlighted the potential for growth beyond the country's borders. He emphasized the need for stability and settling of issues in South Africa to unlock greater growth potential. Afrox has been implementing a turnaround strategy for the past two years, which has shown positive results reflected in the recent financial performance. Celebrating its 90th year of existence, Afrox has weathered various economic cycles and remains a strong brand in the industrial gas sector. Wolk credited the company's cultural change and new values for the successful turnaround, indicating a push towards restoring the company to its former glory. Addressing the gas discoveries on the African continent, Wolk mentioned the potential of Mozambique to emerge as a key player in the energy sector, particularly in LNG. While Afrox is primarily focused on the LPG business, the company sees opportunities to supply products and services to support the infrastructure development in regions like Mozambique. With growing energy projects in the region, Afrox looks forward to leveraging these opportunities for further growth. In conclusion, Afrox's impressive earnings increase reflects the company's resilience and strategic efforts to drive growth. As the company continues to navigate market uncertainties and capitalize on emerging opportunities, the outlook for Afrox appears positive for sustained growth in the future.