The financial results of the Senwes group of companies reflect a 7,8% growth (R303 million profit), attributable to equity holders of the parent company, for the 2019/20 financial year. Earnings before tax, depreciation and amortisation increased by 17,6% from R533 million to R627 million, while earnings per share increased by 5,4% to 178,3c per share.
“This good performance was achieved in a most challenging year with significantly lower summer grain plantings due to the late rain. Late plantings placed limitations on the quality of maize, which resulted in pressure on the market access pillar,” said Francois Strydom, CEO of the Senwes Group. Strydom added that the lower grain volumes had a negative impact on all parties throughout the grain value chain and cash flow pressure and limited capital expenditure ability were clearly visible. Consequently, cash generated from operating activities decreased by 5% to R546 million compared to R575 million the previous year.
Other financial highlights are a 78,7% increase in turnover to R4,8 billion and a final dividend declaration of 30c per share. The net asset value of the group increased by 7,2% and the total shareholder return (share price growth and dividends) for the financial year ended 30 April 2020 amounts to 5,5%.
Diversified agricultural equipment portfolio
The Senwes Group managed to acquire a 57,7% share in KLK Landbou Limited during the year and decreased its risks in respect of its agricultural equipment portfolio by the addition of Falcon Agricultural Equipment, thereby expanding the Senwes Equipment footprint. Senwes also acquired the remaining 50% share in Grainovation during the year in order to fully integrate its service delivery with its silo operations and grain marketing.
Clear strategy for the future
Senwes believes that a clear strategy, the ability to execute the strategy and to manage balance sheet capacity will be the distinguishing factors between role-players. “We believe our sector finds itself at an important point in time in respect of change,” said Strydom. – Press release, Senwes