Cashbuild defies tough times

MARK ALLIX

CASHBUILD’s earnings for the six months ended December soared, despite “difficult trading conditions” it suffered.

Much of the cash business of the retailer of building materials and associated products comes from householders wanting to improve their properties, including those who benefit from statebuilt housing.

It has 217 retail stores, mostly across SA, but also in Malawi, Namibia, Botswana, Swaziland and Lesotho. About 25% of these are in rural areas.

Revenue for the period rose 12%, with gross profit rising 16%. Operating expenses growth was contained at 11%, resulting in operating profit shooting up 31%, Cashbuild said.

Headline earnings per share rose 33%.

“The bottom line grew above revenue due to below-revenue increases in its cost of sales as well as selling and administration expenses,” Alex Sprules, junior research analyst at broker Imara SP Reid, said yesterday.

CEO Werner de Jager said yesterday the group had enjoyed especially good trading in the Namibian market, but overall, Cashbuild stores put in a “fairly good performance”.

Customers are typically home-builders and improvers, contractors, farmers, traders, large construction companies and government-related infrastructure developers.

Cashbuild said its financial position remained solid. Cash and cash equivalents increased 38% to more than R1bn.

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