INNSCOR Africa Limited has successfully concluded the disposal of its interest in Spar Zambia Limited in pursuit of the group’s strategy to focus on core business.
Last year, Innscor Africa announced the disposal of its interest in Spar Corporate Stores in Zimbabwe.
In 2015, the group announced its intent to acquire three local companies to expand its portfolio across different sectors of the economy to minimise risk.
In its unaudited financial results for the six months ended December 31, 2016, Innscor Africa said:
“The group successfully concluded the disposal of its interest in Spar Zambia Limited during the period under review, with this transaction being effective from November 30, 2016.
“Included in the profit after tax from discontinued and discontinuing operations, therefore, is five months of trading this particular business together with the consolidated profit on disposal achieved of $1,720 million.”
Other business included in the discontinued operations include the group’s investment in The River Club, which it is in the process of disposing as well as the wind down costs with Spar Zimbabwe operations.
“In addition to the above businesses, the comparative information disclosed under discontinued operations also includes three months’ trading of the group’s former Quick Service Restaurant (now Simbisa Brands) in 2015 and six months trading of the group’s former Specialty Retail and Distribution businesses (unbundled by way of a dividend in-specie in April 2016, and listed as Axia Corporation Limited on the Zimbabwe Stock Exchange in May 2016).
During the period under review, Innscor Africa’s continuing operations posted revenue of $311,076 million representing a three percent growth on the comparative prior period.
The growth was driven by reasonable volume performance across most operations.
“Notwithstanding the revenue increase, dollar margins were slightly lower than those posted in the comparative period resulting from a combination of higher raw material costs and pricing policies developed to encourage increased demand,” said Innscor.
Operating profit for the group grew by 14 percent on the comparative period to $31,328 million on the back of reduced operating expenditure from various restructure programmes implemented over the past year.
The profit after tax for the period from discontinued and discontinuing operations of $0,120 million was largely a result of the profit recorded on the disposal of the Spar Zambia operation, which took effect from November 30, 2016.
The group’s statement of financial position remained solid with gearing related to continuing operations increasing marginally to 13,39 percent.