The company’s headline earnings were up by 2 per cent to 66, 7 million rand, translating to a diluted headline earnings increase of 1.3 per cent to 203.7 cents despite tough trading conditions.

“The groups strong cash foothold is a considerable achievement given the 40 million rand spent on plant and infrastructure during the year,” Phillip Abelheim, Chief Executive Officer of Transpaco, [DATA TPC:TRANSPACO LIMITED.]said in a press release on Wednesday.

Transpaco declared a final dividend increase of 9 per cent to 53.5 cents a share, taking the full year pay-out to 90 cents per share. This indicates an increase of 12.5 per cent to last year’s 80 cents a share.

The group has stated that their solid results were driven by high volumes and price increases which were supported by well controlled costs and minimal interest paid on borrowings. The company also achieved a milestone when it improved its Broad-based Black Economic Empowerment (B-BBEE) status to level four.

“This opened further opportunity for growth”, said the statement.

Transpaco’s turnover increased by 7 per cent to 1.12 billion rand, which enabled the group to retain its sizeable market share.

 The group’s operating profit was slightly lower at 93.1 million rand compared to last year’s 95.7 million rand due to the price increase in plastic raw materials which pressured margin in their plastics division.

However, Abelheim explained that Transpaco used the price hike in raw materials to their benefit  by capitalising on the rising demand for recycled materials.

“The group’s two recycling facilities in Gauteng are currently operating at maximum capacity,” he added.

Other measures were also put in place to ease the pressure of the margin in their plastic division.  

 “To overcome the margin squeeze, the group has invested in equipment to improve the division’s technological capability and capacity and is exploring new products,” said Abelheim.

He added that Transpaco will be exploring export opportunities in order to take advantage of the recent weakening South African rand.

While the current economic landscape continues to present challenges for Transpaco, such as higher input costs, increasing competition and possible labour incidences, the group’s management remains confident and plans to stick to the their organic growth business strategy through turnover growth, streamline efficiencies, acquisitions and improving cost control and capacity.

“Given the economic climate, aggressive marketing and sales are key to maintaining our momentum. We will continue setting ambitious growth targets and chasing them,” he concluded.