CA Sales Holdings has recorded a double digit increase in gross profit for the year ended December 2018, despite the challenging operating environment that the fast-moving consumer goods (FMCG) that the company and others face.
“Revenue increased by 14.8 percent to over R5.5 billion from R4.8 billion in the prior year, through a combination of organic and acquisitive growth,” said the Botswana Stock Exchange (BSE) listed company this week. According to the financials, the group recorded a gross profit of 14 percent amounting to R824 million and a robust 31 percent increase in headline earnings to R179.4 million.
“This was also supported by the increased shareholding in major subsidiaries towards the end of last year,” reads part of the financials. The group’s headline earnings per share was up 20 percent to 40.11 cents per share, while the group’s total assets increased by 22 percent to R2.5 billion mainly as a result of the acquisition of the land and buildings in Botswana. During the year under review Breckwick, a subsidiary of CA Sales purchased land with warehouses and offices in Botswana previously leased by the group from a third party.
According to the Group, the purchase price was P243 million financed through a bond from Barclays Bank payable monthly over ten years at an interest rate of prime less 0.25 percent. With a diverse geographical presence across Southern Africa operating in Botswana, Lesotho, Mozambique, Namibia, South Africa, Eswatini, Zambia and Zimbabwe, CA Sales service offering includes selling, merchandising, warehousing, distribution, shopper promotions, training and debtor’s administration.
However, CA Sales has shrugged off challenging operating environment and continue to focus on margin retention, stock management, dynamic service levels and continual cost analysis. The group is pleased with the solid results produced by the major operating companies, despite the challenging economic environment in Namibia and South Africa.
In addition, manufacturers’ below the line marketing spend cuts have negatively impacted on the marketing and promotional operations. “It is expected that the difficult economic environment in certain markets will prevail for the time being. “The group is, however, well positioned with a strong balance sheet and a diverse geographical presence across Southern Africa,” said Frans Britz, CA Sales Chief Executive Officer.
Britz is optimistic that the group’s diversified portfolio should enable it to deliver sustainable results in the future.