OMNIA Holdings put in a robust performance in the six months to September 30, and was in a fundamentally stronger financial position than it was two years ago when it ran out of money, chief executive Seelan Gobalsamy said yesterday.
He said in a telephone interview that they turned the group around by sticking to their strategy of focused capital allocation in a disciplined way, including fixing some business and selling others over the two-year period.
In the past six months, the supply chain was optimised for improved reliability. Revenue from continuing operations increased to R9.9 billion from R7.6bn at the half-year of the 2021 financial year.
Gobalsamy said it was the first time Omnia had managed to grow turnover by more than 30 percent; traditionally growth was achieved at operating profit and earnings levels.
Operating profit from continuing operations increased 69.7 percent to R679 million from R400m. Taxed profit more than doubled to R467m from R213m.
Earnings before interest, tax, depreciation and amortisation, excluding impairments, increased to R1.04bn from R773m. Earnings per share increased to 282 cents from 128c.
Headline earnings per share from continuing operations increased to 286c from 125c.
Net cash increased to R719m from R1.9bn net debt at the same time a year before.
Traditionally at the half year stage, the group is in a negative cash position.
“We have continued to focus on disciplined execution of our strategy. This has enabled us to deliver a strong performance.
“We captured growing demand, built an agile supply chain and demonstrated resilience in support of industries vital to many economies,” directors said.
Capital would continue to be allocated prudently.
Gobalsamy said traditionally the second half performance was stronger than the first, and he expected this trend to continue.
He said the group also expected to benefit from the R1bn sale of Umongo Petroleum in the second half.
Australia experienced hard lockdowns, causing operational disruptions and difficulties in logistics. Travel disruptions affected the speed at which various commercial arrangements were concluded.
Omnia’s products were generally classified as an essential service in all geographies, but border crossing and imports to certain countries were slow.
Operating profit from continuing operations increased to R679m from R400m. Taxed net profit rose to R467m from R213m.
The agriculture division’s net revenue increased by 28 percent to R5.19bn, operating profit by 15 percent to R449m. Agriculture RSA’s net revenue increased by 66 percent to R3.5bn.
The manufacturing division optimised the use of nitrophosphate products and available raw materials, thereby lowering the cost of sales.
Controlled costs, enhanced production efficiencies and plant utilisation, supply chain optimisation and improved divisional integration had resulted in better operational performance and improved margins.
Omnia Brazil’s strategy remained focused on distributing high margin Biostimulant products into key crops and growing regions.
A US office was recently established to build a growth platform to enter a large market that was accepting of new “green” technologies, like the group’s coating technologies.
The mining division’s net revenue increased 31 percent to R3.28bn. Mining RSA’s net revenue increased by 56 percent to R1.65bn due to volume growth as well as an increase in the ammonia price. All commodity segments contributed positively to business performance after several growth initiatives delivered to expectations.
Mining International’s net revenue increased 13 percent to R1.63bn as a result of good sales volumes achieved in Zambia, Botswana and Namibia, and the higher ammonia price, partly offset by the strengthening of the rand. The chemicals division’s net revenue for the period increased by 12 percent to R2.28bn and operating remained stable at R109m.
BUSINESS REPORT ONLINE