Restructured Ellies posts loss

Ellies CEO Wayne Samson. Image credit: Russell Roberts via Business Day

The company, which began trading in 1979, has struggled in recent years to attract enough consumers wanting to buy television sets and other expensive consumer electronic devices.

The group unbundled its unprofitable infrastructure business during the previous financial year. Over the past five years, Ellies's share price has fallen about 98%. For the 12 months to April, the company reported a headline loss per share of 7.45c and a loss for the year of R249m.

Samson said the company had been repositioned to focus on consumer goods as opposed to larger commercial and infrastructure work.

"Nonetheless, we managed to maintain revenue at approximately R1.3bn, despite the topline pressures and the difficulty in operating in an import-driven inflationary environment, coupled with the depressed macroeconomic environment and the significant restructuring of our business."

The unwinding of the infrastructure segment had been put into effect during the previous financial year in an effort to "de-risk the group", Samson said. The winding up of this segment had the biggest bearing on the results for the year under review, he said. This included a R178.7m net loss recognised in the financial year for companies that were deconsolidated.

The only operating company in the infrastructure division held on the balance sheet at year end was Botjheng Water, which incurred a cost of R17.5m for a performance guarantee that was presented on it.

Source: Business Day