Alviva Holdings announced its interim results for the six months to 31 December 2017, revealing a number of new acquisitions aimed at strategically growing the group.
Alviva’s overall revenue during the period increased by 1.3% to R6.4 billion, with gross profit rising to R1.1 billion, headline earnings growing to R208.6 million, and basic headline earnings per share (HEPS) increasing to 133cps. Earnings before interest, tax, depreciation, and amortisation (EBITDA) declined by 1.7% to R402.6 million compared to the previous corresponding period.
“The group performed as expected in tough market conditions,” said Pierre Spies, Alviva Holdings CEO. “We anticipated this period to be difficult due to the uncertainty created in the political arena, but the group has delivered excellent returns to shareholders.”
Net profit for the period attributable to the owners of the company climbed to R209 million, compared to R178.7 million in the previous period.
The improvement in the returns to shareholders for the period was largely due to the quality of Alviva’s recent investments – mainly the acquisition of the balance of Datacentrix along with the investment into Alviva’s own share repurchase programme.
Datacentrix has won significant contracts, including ABSA, ACSA, MTN, Sanral, SRA, and Transnet. It has also won awards, including HPE Partner of the Year, Citrix Mobility, Huawei Energy, and various Opentext awards.
“Notably, Datacentrix is a Level One B-BBEE Contributor, and so this acquisition has brought about huge opportunity for us,” added Spies. “We have become the go-to people, as many companies look for these credentials, and we have had a number of potential clients approach us as a result. It’s a fantastic position to be in.”
Further acquisitions were also finalised in the period, and these will start to contribute more meaningfully in the ensuing reporting periods, said Spies. These include VH Fibre Optics (VHF), Digital Generation (DG), and Obscure Technologies – each strategically chosen for the new skills and clients they offer the group.
“We are broadening our reach and getting business from new customers, which bodes well for the future. Investments are being made for new service contracts won in our networking, security, and outsourcing businesses, as well as into automation as we focus on growth and efficiencies,” Spies added.
These acquisitions outline a very specific path Alviva is taking towards digital transformation, Spies explained. “We have strategies in AI, automation, cloud solutions, and cybersecurity. In fact, cybersecurity is our fastest growing division, and the acquisition of Obscure Technologies – a company offering cybersecurity technologies and solutions – will leverage our footprint and credentials for expansion.”
Alviva intends to focus on bedding down these recent acquisitions, but does have its sights set on a few key companies in the cloud space. “One of our big strategies lies in digital transformation, both internally and for our clients to broaden our reach in the industry,” Spies said. “We also need to broaden the scope of our developers, and we are looking at doing an acquisition in that area as well.”
The new acquisitions are expected to contribute positively to the group and to its strategy. “The renewed confidence being felt in the commercial arena should also translate into greater business activity than that experienced in 2017,” Spies concluded. “As a result, the outlook for the year to 30 June 2018 is positive, with earnings per share expected to be above those of June 2017.”
For more information, visit the Alviva website.
This article was published in partnership with Alviva.