Altron’s IT services businesses grew revenue in the six months to August for the first time since a two-year restructuring, and Altron Digital Business made a profit against a loss a year earlier. Its security unit, however, suffered a sharp fall in earnings.
Headline earnings per share from continuing operations rose 14% to 109c, within the range of 107c-112c Altron flagged in September. Revenue rose 5% to R5.1-billion, which the group said was its strongest interim growth in three years. The interim dividend was raised 15% to 55c/share.
Earnings before interest, tax, depreciation and amortisation (Ebitda) rose 16% to R1.09-billion, and operating profit was up 13% at R622-million. Net profit rose 17% to R385-million.
The platforms businesses – Netstar, Altron FinTech and Altron HealthTech – again did most of the work, producing 47% of revenue but more than 95% of operating profit. Their annuity revenue rose 11% to R2.2-billion and now makes up 92% of the segment’s revenue.
“The group delivered its strongest interim top-line growth in three years, while continuing to improve the quality and predictability of earnings through a higher annuity revenue mix and strong cash generation, which increased 32%, to just over R1-billion generated in six months,” CEO Werner Kapp said.
Altron Digital Business, the group’s biggest IT services unit, grew revenue 8% to R1.6-billion and made an operating profit of R22-million, against a loss of R42-million a year earlier, building on the turnaround it achieved in the second half of the previous financial year. The growth came from hardware: revenue from the sale of goods and related services rose 42% to R502-million, while maintenance, support and outsourcing revenue fell 10% to R505-million. Altron said order intake and contract renewals had improved.
Altron Security stumbles
Altron Security went the other way. Revenue fell 18% to R207-million and operating profit dropped to R29-million from R70-million. Altron blamed the timing of software revenue recognition in its identity and digital signing business, and constrained enterprise spending in its much smaller IT services component, where it said management had begun “corrective action”.
During the period, the unit completed the roll-out of Zambia’s national public key infrastructure, the system of digital certificates that underpins digital signatures and secure online identity.
Altron Document Solutions grew operating profit 45% to R48-million on revenue up 4% at R722-million, and distribution business Altron Arrow increased revenue 35% to R388-million.
Overall, IT services revenue rose 4% to R2.5-billion and operating profit grew 62% to R99-million.
Altron FinTech remained the largest contributor to group operating profit. Revenue rose 14% to R858-million and operating profit 17% to R300-million. The number and value of debit orders it processed both grew 14%, and point-of-sale device rentals rose 61% to more than 30 000.
Netstar’s subscriber base grew 8% to 2.3 million, with churn steady at about 16%. Revenue rose 6% to R1.3-billion as an 11% increase in annuity revenue, to R1.2-billion, was partly offset by a 43% drop in hardware sales to R71-million. Ebitda rose 15% to R619-million and operating profit 10% to R248-million.
Netstar’s revenue outside Africa, where its main operation is in Australia, fell 22% to R156-million. Altron said the Australian business “has stabilised and is profitable”, though its growth lags South Africa’s. The group described the current financial year as “a deliberate reset and investment year” for Netstar, which in June set out plans to sell anonymised vehicle movement data.
Altron HealthTech grew Ebitda 13% to R76-million on revenue up 2% at R205-million.
Cash and loans
Cash generated from operations rose 32% to R1.0-billion. Capital expenditure rose 21% to R447-million, most of it spent on rental devices for Netstar and point-of-sale terminals for Altron FinTech.
Altron said it ended the period with net cash of more than R800-million, after paying shareholders R755-million in June: the FY2026 final dividend and the special dividend it announced in May. – (c) 2026 NewsCentral Media
