Nampak reports strong profit growth as turnaround strategy bears fruit

Nampak, the JSE listed packaging group, said attributable profit increased strongly to R1.2 billion in the 12 months to September 30, from R625.6 million the year before, as the group's turnaround gathered momentum.

Group revenue of R10.7bn from continuing operations increased by 8%. This resulted in earnings per share of 13 971.8 cents compared to 7 554.0 cents per share in the previous year. Headline earnings per share came to 10 510 cents compared to 3 361.1 cents per share in the prior period. No dividends were declared.

The results showed: "Strong earnings growth with significant reduction in net finance costs and net debt, supported by disposal proceeds and improved cash flows," said Glen Fullerton, the chief financial officer, in the group's only presentation.

Beverage Nigeria, Inspection & Coding Solutions, certain Kenya assets and the Tubes business were disposed of during the year. The net profit associated with these amounted to R2.4bn, inclusive of a net recycling of the foreign translation reserve gain of R2.2bn with a comparative loss of R1bn.The group continues to hold Nampak Zimbabwe as an asset held for sale.

The group's net asset value per share at September 30 of 29 823 cents had increased 110% from 14 216 cents at September 30 of the previous year, largely due to net profit in the year assisted by the asset impairment reversal related to Beverage Angola.

Nampak's share price was unchanged at 54 000 cents on the JSE Monday afternoon, a price that was 24.7% higher than the previous year. In terms of the group total operations, the R3.5bn attributable profit represented a turnaround from the R372.6m loss in the previous year. Headline earnings per share of total operations came to 12 089.4 cents versus 1 378 cents per share the previous year.

At year-end, the group net debt excluding capitalised lease liabilities was R2.1bn compared to R4.4bn in the prior year, primarily due to proceeds from disposal transactions during the year utilised to repay net debt.

Cash generated from operations increased 16% to R2bn from R1.8bn. Cash holdings of total operations increased from R553.1m to R1.4bn.

Phil Roux, the CEO who had overseen the restructuring in the group, said the turnaround was gaining traction. Cash flows were strong, debt was lower and finance costs had fallen.

Roux had been expected to retire on September 30, 2025, but the group recently announced the appointment of former Pepsico Southern Africa CEO Rian Heyl as the new Nampak CEO, from February next year. Roux's exit had been delayed after a CEO-designate Andrew Hood, who was meant to have taken up the CEO position on October 1, 2025, resigned owing to family circumstances.

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