Super Group pays out a big special dividend following disposal of SG Group in Australia

SUPER Group paid out a substantial special dividend of R16.20 for the year to June 30, arising principally from the sale of SG Fleet in Australia, compared with 60 cents a share paid out a year before.

The special dividend amounted to R5.54 billion in total, and the per share payout was more than the share price of R14.12 on Tuesday. Tuesday’s share price was also well below the R24.15 it traded at one year before. The group did not, at the release of annual results on Tuesday, declare an ordinary dividend.

The sale of SG Fleet in Australia had unlocked R7.47bn in capital and also enabled a R1.96bn repayment of interest-bearing debt.

This dramatically improved the group balance sheet, reducing net gearing to 20.6% from 136.3%.

Marking a transformative year for the group, key divestments, including the sale of SG Fleet and the inTime business in Germany, had streamlined operations and improved the group's financial position, Super Group’s chairman Valentine Chitalu and CEO Peter Mountford said on behalf of the board in the annual results.

This had reduced debt and set the stage for sustainable, scalable growth across its core Southern African and international markets, they said.

Revenue for the year decreased by 1.4% to R44.51bn. Earnings before interest, tax, depreciation and amortisation fell by 2.4% to R3.68bn. Operating profit fell by 8.9% to R1.87bn.

Headline earnings per share decreased by 1.2% to 239.8 cents. Net tangible asset value per share increased 281.4% to R26.32.

The directors said the performance reflected an ability to adapt amid global uncertainty. While macroeconomic and infrastructural challenges persist within the commodity businesses, a focus on service and on deploying capital into high-growth opportunities had helped the group to navigate these challenges.

On June 30, an agreement was signed to sell the inTime group in Germany to Mutares SE & Co. KGaE, a listed private equity holding company based in Munich. The inTime group, excluding Ader, was classified as a discontinued operation in the current financial year.

The disposal hd followed sustained challenges at inTime that arose primarily from a sharp decline in European automotive parts volumes and margin pressure caused by a slowdown in vehicle manufacturing activity in Germany.

In the UK, Super Group also exited its Suzuki dealerships and reclassified its Kia and Hyundai dealerships as held for sale during the second half of the financial year.

Impacted by poor results in the UK Dealerships and the Supply Chain Africa Commodity businesses, the group’s revenue from continuing operations decreased by 1.4% to R44.51bn. Revenue contributions from the Supply Chain, Dealerships and Fleet Solutions divisions were 46.4%, 50.8% and 2.8% respectively.

On the outlook, Chitalu and Mountford said they expected improved earnings. The potential improvement partially relied on a better performance from the Southern African commodity supply chain businesses, in relation to copper exports, in particular.

The benefits of rationalising the Dealership operations and cost structures across the UK should also contribute to a better earnings performance.

The Consumer Supply Chain and Fleet Lease businesses were expected to perform well, mainly as a result of a number of new customers and expanded service offerings.

The South African Dealership operations were expected to maintain a strong performance, with revenue growth anticipated from the expanding network of emerging brands.

“With improved capital allocation and reduced financial leverage, Super Group is well-positioned to pursue high-growth opportunities and respond effectively to macroeconomic volatility. The group remains firmly focused on scalable, high-performing operations across sub-Saharan Africa, the UK, and Spain,” they said.

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