Adapt IT, a provider of specialised software solutions and services to the Education, Manufacturing, Energy and Financial Services sectors, has announced its interim results indicating an 85% profit increase for the six months ended 31 December 2014.
“In line with our strategic expansion plan, our strong organic growth in tandem with strategic acquisitions have yielded continued positive results for Adapt IT,” says JSE-listed Adapt IT’s CEO, Sbu Shabalala.
Turnover for the year increased 38% to R261 million aided by positive contributions emanating from the existing divisions’ organic growth of 11% and acquisitive growth contributing 27%. Profit increased 85% to R38 million contributing to operating profit margin improvement to 14,5% from 10,8% of the last financial year, with headline earnings per share increasing in-line to 36%.
On 1 September 2014, Adapt IT acquired AspiviaUnison (“AU”), a cloud-based enterprise and carrier communications management software-as-a-service (SaaS) solutions business, which has contributed positively to the financial services and manufacturing segments of Adapt IT. The AU acquisition was in-line with Adapt IT’s strategy of acquiring strategic software companies that improve the company’s competitiveness within the sectors wherein it operates, being Manufacturing and Financial Services, in AU’s instance.
Black Economic Transformation remains a strategic imperative for the group. As part of its acquisition funding, Adapt IT raised R41,8m equity and enhanced its black ownership equity status by 4,7% and specifically its broad-based black female ownership equity status by 2,82%. Further: A strategic investment was made through the acquisition of a 49% interest in Uyandiswa Project Management Services, a black woman-owned project management consultancy, in an Enterprise Development transaction.
Adapt IT’s revenue is well diversified across four major sectors, improving resilience to market cycles and its strong annuity income provides long-term sustainability. South African revenue in the period comprises 78%, with 10% of revenue coming from other African countries and the balance from global customers. Growth in the Africa market remains a continuing focus.
Adapt IT pursues growth by improving its market share through organic growth means within its targeted sectors and pursing strategic earnings enhancing software business acquisitions. “Our outlook remains positive as we continue to build on the strong well-diversified foundation, to create a sizeable leading ICT business that delivers above ICT sector average growth and returns.” concludes Shabalala.
