Leveraging the strong performances of its subsidiaries Altx-listed logistics group OneLogix continued its growth trend, with revenue of R168 million for the year to May 2006 up 58% from R106 million. In an active period, OneLogix also concluded a strategic BEE transaction that saw a consortium including Sipho Pityana’s Izingwe Capital and the group’s black staff take a 25% stake in the operating company.
Operating profit grew by 16% to R20 million, representing approximately 12% of revenue. Cash from operations increased from R11,5 million to R21,1 million, supporting growth in headline earnings per share of 15% to 7,8 cents per share.
CEO Ian Lourens attributes the group’s results to the higher revenue generated by auto-logistics specialist Vehicle Delivery Services (VDS) and good trade at 4Logix. He adds that continued focus on strengthening management at all of the subsidiaries contributed to growth as well.
“Our investment in VDS to bolster fleet, software and IT systems, has yielded benefit in that the company has continued to dominate the cross-border auto-logistics market. In addition VDS has established itself as a player in the intra-SA market too,” says Lourens. A further investment was made to acquire and upgrade new facilities for VDS in Durban and Pomona. The R38,3 million total investment was financed in part by R20,8 million cash from operations and the balance of R17,5 million by borrowings.
4Logix and its black-empowered subsidiary Gijima, sustained their performance off the back of ongoing long-term contracts. These high revenue, low margin businesses offer logistics solutions for the rail of bulk commodities to ports throughout SA.
“We are pleased that Media Express managed to retain a sizable market share in the express media delivery market despite intense price competition,” says Lourens. In addition expansion into allied markets, including same day deliveries and excess baggage services, has been successfully implemented. “Led by strong management, Media Express should enjoy further revenue growth in light of its consolidation and expansion.”
Franchised chain PostNet continues to boast growth from its 215 stores. Lourens says that its largely courier-based services generate sustainable annuity revenue streams for the group. In line with strategy to revitalise the brand, the chain introduced new product and service initiatives to strong interest from its target SMME market. “Our revised courier model now including an online facility reflects our focus on effectively integrating IT into operations,” he says. Lourens expects a continued good performance from PostNet going forward.
Looking ahead he is confident that the group’s enhanced BEE credentials will continue to drive organic growth. “The deal has put the company in a strong position to secure clients in light of preferential procurement practices.” He says that prospects are also promising as a result of solid, focussed management and attractive product and service offerings. “In addition our positioning in high growth niche markets further bodes well for future growth,” he concludes.
OneLogix shares closed yesterday at 60 cents.
Ends.Issued by: Envisage Communications
(011) 325 5944/083 287 2771
On behalf of: OneLogix Group Limited
Ian Lourens, CEO
(011) 396 9040/ 082 440 9683
Issue date: 30 August 2006
OneLogix owns niche business solutions supplier PostNet, which specialises predominantly in courier services. The group further includes auto-logistics specialist Vehicle Delivery Services, an established leader in cross-border transportation of vehicles into Africa which also recently debuted successfully onto the local auto-logistics market. Media Express is responsible for the overnight distribution of many of SA’s major business newspapers and magazines. 4Logix is the newest group company and operates in the local and international bulk commodities rail logistics market. The group has also acted as an incubator for suppliers in its business areas and has an effective 25,1% shareholding in Gijima Supply Chain Management Services (Pty) Ltd. Gijima’s primary focus on the rail bulk commodity market complements the core business of 4Logix.