Motus Projects 25%-35% Drop in EPS and HEPS for 2024

  • Motus Holdings projects a 25%-35% decrease in EPS and HEPS for the twelve months ending June 2024.
  • The South African economic environment remains challenging due to elections, high interest rates, and fuel prices.
  • Motus maintains confidence in its long-term strategic priorities and anticipates declaring a dividend in October 2024.

Motus

Motus Holdings Limited has released a trading statement and operational update. The update indicates projected financial results for the twelve months ending June 30, 2024. Revenue is expected to increase slightly compared to the previous year, while EBITDA remains consistent.

Financial Projections

Motus projects a significant decline in earnings per share (EPS) and headline earnings per share (HEPS) for the period. The EPS is expected to be between 1,305 and 1,505 cents per share, a decrease of 25% to 35% from 2,008 cents per share. Similarly, HEPS is forecasted to range between 1,330 and 1,535 cents per share, down 25% to 35% from 2,046 cents per share.

Projected Financial Results:

MetricProjection (2024)Actual (2023)Percentage Decrease
EPS (cents/share)1,305 – 1,5052,00825% – 35%
HEPS (cents/share)1,330 – 1,5352,04625% – 35%

Economic Environment

The South African trading environment is challenging. Factors such as elections, high interest rates, fuel prices, and energy costs contribute to economic uncertainty. These elements strain consumers’ disposable income, affecting their purchasing power.

Impact on Vehicle Market

Higher-than-normal vehicle and parts price inflation, exacerbated by a weak Rand, impacts affordability. The oversupply of vehicles from Original Equipment Manufacturers (OEMs) is moderating. However, continued discounts to stimulate sales are negatively affecting margins.

Strategic Initiatives

Motus is focusing on international expansion and diversifying beyond vehicle sales. These strategies support business segments less impacted by limited consumer spending. The company is maintaining its long-term strategic priorities, aiming to be the leading automotive group in South Africa. It also seeks a selective international presence in the UK, Australia, and limited regions in Asia and Africa.

Liquidity and Debt Management

Net debt is decreasing due to declining inventory levels and reduced demand for hire vehicles since July 2023. Motus remains within agreed bank covenant levels and has sufficient banking facilities.

Dividend Announcement

Motus anticipates declaring a dividend in October 2024, providing returns to shareholders.

Management’s Confidence

Motus management is confident in navigating the challenging environment with its experienced team and strategic initiatives. The company believes its diversified, integrated business model will ensure stability and growth.

Upcoming Financial Results

Motus will publish its audited financial results for the twelve months ending June 30, 2024, on September 3, 2024. An investor presentation will be hosted both virtually and in-person at the JSE on the same day at 09:00.

Forward-Looking Statements

The company issued a disclaimer noting that forward-looking statements are based on current views and forecasts. These predictions may differ materially if risks materialize or assumptions prove incorrect. Motus does not commit to updating these statements.

Conclusion

Motus Holdings Limited is navigating a challenging economic environment with strategic initiatives focused on international expansion and diversification. Despite anticipated declines in EPS and HEPS, the company remains confident in its ability to manage through these times with a stable liquidity position and strategic focus.


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