Business Connexion plugs into profit

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Revenue for the group increased by 5.9 per cent to 6.1 billion rand for the year ended August 31 2013 from 5.8 billion rand in the previous comparative year.

Operating profit also increased by 17.3 per cent to 322.6 million rand from 275 million rand in 2012.

“The past year saw Business Connexion gain significant momentum on its journey to being Africa’s leading technology company,” the group said in a statement.

“The focus on solid organic growth, African expansion, strategic acquisitions in the context of long-term sustainability and cost containment has delivered a robust performance in 2013, and further builds the foundation to support the Group’s future growth.”

[DATA BCA:Business Connexion] is a South African-based ICT company with operations in Africa, Europe and the Middle East. Business Connexion is specifically present in Kenya, Mozambique, Namibia, Nigeria, Zambia and Tanzania.

Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 9.5 per cent to 560.5 million rand. Normalised diluted earnings per share increased from 50.6 cents in 2012 to 52.6 cents.

Revenue for the group’s services division increased by 7.7 per cent to 2.1 billion rand from 1.9 billion rand in 2012. Profitability in the division was however negatively impacted by the delays in transitioning a number of new contracts in the first half of the year.

The group’s UCS division grew 7.1 per cent to 1.1 billion rand from one billion rand in the previous comparative year. Operating profit for the division however dropped by 14.1 per cent to 100.4 million rand from 116.9 million rand in 2012.

The UCS division is responsible for providing full range of ICT infrastructure services for Tier-1 retail and Tier-2 IT services requirements.

“Despite difficult trading conditions within the retail industry the UCS assets continued to show pleasing growth. In addition, the expansion of the Group’s retail offerings into Africa is starting to gain traction and will further materialise in the year ahead,” the group explained.

Revenue for its technology division also grew and made a 26.5 million rand contribution to operating profit for the year from a 3.3 million rand contribution last year.

Business Connexion’s international division captures growth in Kenya, Mozambique, Namibia, Nigeria, Tanzania, Zambia and the UK. Revenue in the division grew 13.9 per cent to 532.3 million rand from 467.2 million rand in the previous year.

In April 2013 the group sold its QDD business to Arinso SA Proprietary Limited in exchange for 50 per cent of the ordinary shares in Arinso.

In 1 September the same year the group entered into an agreement with to dispose of its entire interest in the QLINK business unit to Summit Garnishee Solutions Proprietary Limited for a cash consideration of R187.5 million rand.

“Looking ahead, the Group will continue to focus on driving higher returns, including attaining its return on equity targets through a number of ongoing initiatives, including continued efforts to entrench and grow its footprint in Africa,” the group explained.