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Industrial mineral business lifts Afrimat’s earnings
Buildings material company, Afrimat says its diversification plans helped weather the tough economic conditions with its interim revenue rising 19 per cent to R1.7 billion. The company raised its dividend to 36 cents from 19 cents previously. Afrimat CEO, Andries van Heerden joins CNBC Africa for more.
Thu, 31 Oct 2019 15:30:42 GMT
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AI Generated Summary
- Afrimat reports a 19% increase in interim revenue to R1.7 billion, with a dividend rise to 36 cents from 19 cents.
- The company's diversification strategy, focusing on industrial minerals and iron ore business, contributes to exceptional performance despite market challenges.
- CEO Andries van Heerden emphasizes sustainable growth, cash generation, debt reduction, and potential acquisition opportunities, highlighting optimism about infrastructure developments and expansion into African markets.
Afrimat, a building materials company, has reported a significant rise in its interim revenue, showcasing a 19% increase to R1.7 billion. The company also announced a substantial increase in its dividend to 36 cents, up from 19 cents in the previous period. CEO Andries van Heerden attributes this success to the company's diversification strategy, which has allowed them to weather tough economic conditions. The CEO highlighted the exceptional performance of the industrial minerals business, which saw a 50% growth in profit, as well as the success of the iron ore business. Despite a slight slowdown in pricing towards the end of the reporting period, Afrimat remains optimistic about its sustainable growth. Van Heerden also emphasized the company's focus on cash generation and debt reduction, positioning Afrimat for potential acquisition opportunities. The CEO expressed enthusiasm about the infrastructure fund announced by the finance minister, which is expected to benefit construction projects in South Africa. Afrimat, as a materials company, stands to gain from increased infrastructure development. While some shareholders and analysts have suggested a special dividend payout, van Heerden believes that reinvesting in the business and pursuing growth opportunities is a more prudent strategy. Looking ahead, Afrimat sees promising opportunities in Mozambique and other African countries, particularly in the construction sector. Despite a challenging market landscape, Afrimat's strong performance and strategic outlook indicate sustainable growth in the future.
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