STRATEGIC DELIVERY UNDERPINS ROBUST PERFORMANCE AND DIVIDENDS IN CHALLENGING ENVIRONMENT
- Operating profit from continuing operations rose to R1.2 bn (FY20: R744m)
- Headline earnings per share from continuing operations of 391 cents (FY20: 154 cents)
- Cash generated from operations of R2.3 bn (FY20: R2.2 bn)
- Sale of Oro Agri completed during the year with proceeds used to settle debt
- Cash increased by R3.1 bn to R1.8 bn (FY20: interest-bearing borrowings of R1.3 bn)
- Shareholder distribution of R1bn
- Ordinary dividend resumed at 200 cents per ordinary share
- Special dividend declared at 400 cents per ordinary share
- Improved environmental, safety and transformation performance
Tuesday, 22 June 2021: Omnia Holdings Limited (“Omnia”), a JSE-listed diversified chemicals Group, today announced a strong performance for the 2021 financial year despite the impact of COVID-19 and general economic and sector challenges.
Throughout the pandemic, Omnia continued its delivery of essential services, including primary chemicals and solutions for the agriculture, mining, manufacturing and fuel sectors which play an essential role in food security, economic stability and the livelihoods of people globally.
Omnia’s CEO, Seelan Gobalsamy, commented: “These results reflect a resilient performance achieved through continued delivery against our strategy in a challenging and dynamic environment that required decisive management action and agility. Our proactive approach to managing all our businesses and the Group’s balance sheet has placed Omnia in a strong financial position, allowing us to resume dividends and return over R1 billion to our shareholders.”
In October 2020, Omnia entered into an agreement with European Crops Products 2 S.A.R.L (ECP), a European-headquartered business, to dispose of Oro Agri for a consideration of USD146.9 million. The effective date of the sale is 7 January 2021. Oro Agri has been reported as ‘Agriculture Biological’ and accounted for as a discontinued operation.
Group revenue from continuing operations was stable at R17.8 billion while operating profit from continuing operations rose by 61% to R1.2 billion, largely driven by a solid performance from the Agriculture division. Omnia’s earnings before interest, tax, depreciation, and amortisation (EBITDA) from continuing operations, excluding impairments increased 24% to R2.1 billion, while headline earnings per share (HEPS) from continuing operations rose to 391 cents, up from 154 cents, an increase of 154%.
The consistent delivery against clear strategic objectives resulted in improved cash generation of R2.3 billion from the underlying businesses which, together with the proceeds from the disposal of the discontinued operation, supported the ability to extinguish core term debt and contributed to Omnia’s strong financial position. Omnia ended the financial year in a cash position of R1.8 billion.
“We are committed to create long term value for stakeholders through sustainable business practices, the pursuit of organic and inorganic growth opportunities, greener technologies and expansion into geographies that align with Omnia’s purpose and enhance the Group’s impact in the world,” added Gobalsamy.
Omnia’s proven safety record allows it to compete effectively in key markets, with the Group achieving a Recordable Case Rate (RCR) of 0.35 compared to 0.49 in the prior period. Omnia’s carbon footprints remained a priority in the period with prior investment into world-class nitrogen oxide abatement technology (EnviNOx) resulting in reduced carbon dioxide emissions. Total greenhouse gas emissions reduced to 261 500 tonnes of CO2 equivalent, 58% less than they were in the comparative period.
Energy efficiency and water use efficiency improved by 9% and 8% respectively, despite an increase in production volume of 15%. Having achieved supplier recognition of 125% as well as full scores for Ownership, Enterprise & Supplier Development and Socio-Economic Development, Omnia’s B-BBEE rating improved to Level 2.
“I am proud to report that the Group’s positive performance extends beyond financial benefits as demonstrated by the improvement in sustainability metrics, including safety performance, empowerment, water and energy use efficiency, and greenhouse gas emissions, ” added Gobalsamy.
A total shareholder distribution of R1 billion which comprises of the resumption of an ordinary dividend of 200 cents per ordinary share along with a special dividend of 400 cents per ordinary share has been declared. The Board is carefully considering further capital allocation decisions that are value-accretive, provide the right diversification that is complementary to Omnia’s core businesses and skill set and strengthen the Group’s overall positioning.
Speaking on the outlook for the year ahead, Gobalsamy concluded: “Agriculture and mining fundamentals are encouraging and while market challenges and COVID-19 risks remain, each of our divisions is focused on driving their respective strategies, realising efficiencies and leveraging their trusted market positions to take advantage of growth opportunities .”