Combined Motor Holdings Limited (CMH) recently released its financial highlights for the year ended 29 February 2024, providing investors and stakeholders with a comprehensive overview of its performance. This article delves into CMH’s financial metrics, dividend declaration, and key highlights from its annual report.
Financial Highlights
CMH’s financial performance for the year ending February 2024 showcases both strengths and areas for improvement. Here’s a breakdown of the key financial metrics:
| Metric | 2024 Value | Change from 2023 |
|---|---|---|
| Revenue | R12.84 billion | Up 3% |
| Basic Earnings per Share (EPS) | 546.1 cents | Down 8% |
| Cash Resources | R815.1 million | Up 7% |
| Operating Profit | R781.2 million | Up 1% |
| Headline Earnings per Share (HEPS) | 541.8 cents | Down 12% |
| Net Asset Value per Share | 1,828 cents | Up 8.2% |
Revenue Growth and Profitability
CMH’s revenue increased by 3% compared to the previous year, reaching R12.84 billion. This growth is a positive indicator of the company’s market strength and ability to generate income. However, the decline in basic EPS by 8% and HEPS by 12% raises concerns about the company’s profitability and efficiency in converting revenue into earnings.
Cash Resources and Operating Profit
The company’s cash resources saw a healthy increase of 7% to R815.1 million. This growth indicates CMH’s liquidity and ability to meet short-term obligations. Similarly, the operating profit rose by 1%, reaching R781.2 million. While the increase is modest, it reflects the company’s effective cost management and operational performance.
Net Asset Value and Shareholder Returns
CMH’s net asset value per share rose by 8.2% to 1,828 cents. This indicates the company’s ability to create value for shareholders through its asset base. However, the return on shareholders’ funds declined significantly by 16.9%, signaling a lower return on investment for shareholders compared to the previous year.
Dividend Declaration and Tax Implications
The company declared a dividend of 220 cents per share for the year, payable on 18 June 2024. This represents an 8.3% decrease from the previous year’s dividend. Shareholders should note that a 20% dividend withholding tax applies, resulting in a net dividend of 176 cents for non-exempt shareholders.
Financial Health and Investment Considerations
CMH’s financial performance for 2024 reflects a mixed outcome. While revenue and cash resources increased, earnings per share and shareholder returns declined. Investors should consider these factors along with the company’s dividend policy and tax implications before making investment decisions.
Conclusion
Combined Motor Holdings Limited’s financial performance for the year ended February 2024 reflects both strengths and challenges. The company has shown resilience in revenue generation and liquidity management, but profitability metrics such as EPS and ROE have declined. Shareholders and investors should carefully evaluate these factors and consider the company’s long-term strategy and market conditions before making investment decisions.
