INVICTA HAS AGAIN PRODUCED OUTSTANDING RESULTS IN A VERY CHALLENGING ECONOMIC ENVIRONMENT. ...

• Earnings per share grew by 3,7% to 453 cents per share
• Dividend increased by 9,4%
• The only JSE Company ever to achieve TOP 100 STATUS 15 years in a row

GROUP OVERVIEW

The Group has again produced outstanding results in a very challenging economic environment. The market was characterised by weak demand for product, a global liquidity crisis, a strong Rand and generally tough economic conditions.

Notwithstanding, turnover declined by only 12,3% to R3 969 million. Acquisitions accounted for R202 million of turnover.

Good margin management and tight cost controls resulted in operating profit declining by a modest 8,9% to R453 million. Improved financing costs and dividends received led to profit for the year increasing by 0,7% to R365 million. A reduction in the weighted average number of shares in issue resulted in earnings per share increasing by 3,7% to 453 cents per share.

Particular emphasis was placed on working capital management, resulting in cash generated from operations of R590 million being achieved, the highest ever.

The Group took advantage of weak market conditions and made a number ofstrategic acquisitions. The more significant of these was the acquisition of 100% of Criterion Equipment (Pty) Limited and 70% of Wegezi Power Holdings (Pty) Limited subsequent to year-end. Criterion Equipment operates in the
materials handling sector with TCM forklifts being its primary product. Wegezi Power Holdings manufactures and repairs transformers, electric switch gears, panels and pumps.

BMG (Bearing Man Group)

BMG continues to be the core profit base of the Group. Trading conditions in the industrial consumable sector were particularly challenging. Commodity prices were under pressure due to the global recession. Key market segments of mining and manufacturing also showed substantial declines. Margins were under pressure as the Rand strengthened. The competitive market environment, the strengthening of the Rand and the clearing of higher priced inventory received at weaker exchange rates contributed to lower margins. In spite of these adverse conditions, BMG achieved turnover for the year of R2 018 million, a decline of only 5,5% and operating profit declined by 10,1% to R293 million. The operating margin was a pleasing 14,5%.

The BMG brand (launched last year) has now been firmly entrenched as being representative of the market leader in the industrial consumables sector. BMG Hydraulics was successfully established during the year with the re-branding of Goldquest Hydraulics. BMG continued to invest in staff training and education and in strategic acquisitions, the most important of which was Wegezi Power Holdings, effective 1 April 2010. Wegezi Power Holdings’ core business is ..... Next Page