South Africa: Securedata Africa 'Stable and Ready for Growth'
Software firm SecureData Holdings said last week that its SecureData Africa division was now stable and well positioned to seek additional revenue growth. Earnings in SecureData Africa fell last year because of slow uptake of its products and an increase in operating costs. The division markets and distributes the group's software security products in South Africa and the rest of the continent.
In the six months to January, SecureData Africa posted 63% growth in earnings before interest, tax, depreciation and amortisation, to R16,3m. The margin on earnings before interest, tax, depreciation and amortisation improved to 12.4% from 7,6%. Revenue was flat at R131.9m.
SecureData attributed the turnaround to the review of its product portfolio, cost management and management restructuring. "This is a robust performance and management is confident that SecureData Africa is now stable and well positioned to seek additional revenue growth, while maintaining this strong margin performance," CE Dean Brazier said. SecureData Africa contributes about 60% to SecureData's total revenue.
The group's revenue declined 5% to R220.2m because of the stronger rand against the pound , which hit SecureData's UK subsidiary, MIS Corporate Defence Solutions (MIS-CDS). MIS-CDS's earnings before interest, tax, depreciation and amortisation grew 5% to R5,5m while revenue was 12% lower at R78.6m. SecureData is confident that MIS-CDS will continue to show improvement despite continued economic uncertainty in the UK. SecureData's earnings before interest, tax, depreciation and amortisation jumped 26% to R24.2m.
Headline earnings per share increased marginally to 0.8c from 0.7c. Adjusted earnings per share rose 55% to 4.8c. Brazier described the first half of the year as "a positive period for SecureData", as it continued with its vision of being a significant player in the software market that it operated in. He said the software market, which the group referred to as information risk management, had historically proven to be resilient during an economic downturn.
Brazier said it was difficult to predict the extent to which current financial market turmoil would affect buyer activity. However, he believed SecureData was well positioned to take advantage of opportunities in the information risk management sector.