Grindrod (GND) H1 2024 earnings summary

Executive summary

• Delivered resilient interim results for H1 2024, with core headline earnings of R562 million, core EBITDA of R1.0 billion, and revenue of R2.48 billion, despite challenging macroeconomic and commodity market conditions.

• Interim ordinary dividend declared at 23.0 cents per share, down from 34.4 cents in H1 2023; preference dividend at 516.0 cents per share.

• Port volumes increased 18% to 6.9 million tonnes, with Maputo and Richards Bay terminals showing strong growth; drybulk terminal volumes rose 3% to 8.4 million tonnes.

• Disciplined capital allocation and cost containment supported cash generation and a dividend payout in line with revised policy.

• One fatality reported at Durban terminal; LTIFR at 0.45.

Financial highlights

• Revenue dipped 1% year-over-year, mainly due to the absence of value-added services earnings from the prior strong coal cycle.

• Core EBITDA reached R1.0 billion, down from R1.1 billion in H1 2023; EBITDA margin declined to 28% from 30% last year.

• Net profit attributable to ordinary shareholders was R486 million, up 9% from H1 2023.

• Cash generated from operations increased 13% year-over-year to R425 million.

• Net debt rose to R501.8 million from R100.6 million at December 2023; net debt-to-equity ratio at 16%.

Outlook and guidance

• Cautious outlook with focus on cost control, operational efficiency, and strict capital allocation for quality, cash-generative projects.

• Emphasis on optimizing operations, infrastructure investment, and readiness for private rail operator access.

• CapEx pipeline of R2.4 billion, mainly for terminals and rail, with technology investments to drive corridor efficiency.

• Richards Bay container terminal targeted for 2027 start, with efforts to accelerate if possible.