Altron's share price rises after the streamlined ICT group posts strong financial results

JSE-listed ICT group Altron’s share price increased over 3% on Monday after reporting a substantial 73% hike in headline earnings per share of continuing operations to 173 cents for the year to March 31, 2025.

There was strong growth in profitability, primarily driven by the Platforms segment. A 50 cent a share final dividend was up 52% over last year. Revenue of continuing businesses was flat at R9.6 billion, impacted by the sale of the ATM Business hardware and support operations. Excluding ATM Business, revenue increased by 3%.

The share was trading at R24.16 on Monday afternoon on the JSE, a price that had rallied from R13.20 a year ago.

“Our high annuity revenue base provides a solid foundation, with our Platforms segment a key growth driver, delivering double-digit revenue and profit growth. This consistent performance has strengthened our financial position and enabled us to deliver meaningful value to our shareholders," CEO Werner Kapp said in a statement.

Ashburton Investments Head of Equity Charl de Villiers said the focus of the group had shifted somewhat from its traditional IT businesses, due to the weaker macroeconomic environment in South Africa, to the group’s Netstar and Altron FinTech businesses that have grown strongly over the past two years.

He said a clean-up of the group’s portfolio meant the 2026 financial year would likely be the first that results would be presented free from impairments and losses of underperforming units. There were also potentially longer-term international and value unlock opportunities, in Netstar in particular, he said.

Altron’s earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 27% to R1.8bn. Operating profit increased 50% to R972 million.

Continuing operations include Netstar, Altron FinTech, Altron HealthTech, Altron Digital Business, Altron Security, Altron Document Solutions, Altron Arrow and excludes Altron Nexus.

The ATM Business of Altron Managed Solutions was sold from July 2023, with four months trading included in the comparative results.

In terms of total operations, Altron’s revenue fell 4% to R9.9bn primarily due to the sale of ATM Business and lower revenue at Altron Nexus after its restructuring. Excluding ATM Business, revenue reduced 1%.

Netstar delivered a robust performance - EBITDA was up 17% to R935m following a 16% growth in subscribers to over 2 million, supported by double-digit growth in both the consumer and enterprise segments. Netstar's global fleet bureau scaled to over 33,000 assets, supporting growth in data-driven managed services revenue.

Altron FinTech increased EBITDA by 38% to R457m, driven by strong growth in the SME customer base and increased volume and value of debit orders processed through its collection and payment platform.

Within IT Services, Altron Document Solutions was reclassified as a continuing operation following a review. Altron Document Solutions delivered EBITDA of R84m compared to an EBITDA loss of R74m last year, while profit improvement strategies are still underway.

Some R645m growth capital expenditure was invested, focused on Netstar, Altron FinTech and systems and platforms.

"This year's strong results reflect the disciplined execution of our strategy, despite heightened economic and political uncertainty,” said Kapp.

The Platforms segment, where capital was allocated to support strategic growth, saw a 12% lift in revenue, a 23% increase in EBITDA and a 30% increase in operating profit. An agreement had been reached to sell Altron Nexus, the group’s remaining discontinued operation, to a consortium that includes members of Altron Nexus' management team.

The group had re-organised its businesses on March 1, 2024, as part of a strategy to become the leading platform and IT services business in its chosen markets.  Altron Digital Business made “solid progress” in integrating Altron Systems Integration, Altron Karabina, and Altron Managed Solutions. 

Altron Nexus, listed in discontinued operations, reported revenue of R343m versus R659m the prior year. EBITDA improved to a R149m loss from a R421m loss. The management buyout was not expected to generate any disposal proceeds for the group.

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