The equipment division's results were boosted by the recent acquisitions of the Bucyrus distribution businesses in Southern Africa and Russia. These businesses performed ahead of expectations‚ even as global mining companies reduced capital expenditure.
The supplier of heavy earthmoving and power systems is also an integrated rental‚ fleet management‚ product support and logistics solutions provider.
The maintenance functions across its diverse business unit means that despite external market conditions‚ annuity income continues to stream in.
"The automotive and logistics division delivered a strong result with all business units performing well ahead of the prior year‚" CEO Clive Thomson said on Monday.
"We continued our strategy of allocating capital to higher-returning businesses and were successful in concluding a number of important acquisitions and disposals in the period‚" he said.
Group revenue was up by 11% and operating profit rose 18% to R3.53bn. This allowed Barloworld to declare a year-end dividend that was up 27% from previously.
Working capital levels were reduced significantly in the second half‚ the group said‚ lowering the net debt to equity ratio at year-end to 47% from 77% in the first half.
In the equipment division‚ the Bucyrus southern Africa distribution businesses bought last year performed well and was earnings accretive in its first full year of operation.
Dominic Sewela‚ CEO of Equipment Southern Africa‚ said on Monday the Bucyrus acquisition had complemented the Caterpillar heavy equipment range -- and had not detracted from Caterpillar sales -- adding hydraulic and rope shovels to the mining and earthmoving mix.
But he said the government's promise of significant domestic spending on many earmarked strategic infrastructure projects was still not forthcoming.
Meanwhile‚ the Russian surface and underground mining products business had significant long-term growth potential‚ the group said.
However‚ following the sale of group handling businesses in the US and UK last year‚ Barloworld had now disposed of its handling business in Belgium‚ and was in the progress of selling the handling business in The Netherlands.
In the automotive and logistics division‚ the company said it continued to grow Avis Fleet Services in Ghana off a small base. It also acquired the 25% minority share in its Lesotho fleet services operation.
On the motor retail side it bought the 49% minority share of its Toyota Stellenbosch dealership‚ while disposing of the Ferntree Gully dealership in Australia.
Thomson said Barloworld saw "big opportunities" in abnormal load transportation in Southern African markets.
By 1.50pm on the JSE‚ the company's share price was up 1.5% at R98.
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