iOCO (IOC) H2 2024 earnings summary

Executive summary

• Achieved significant turnaround with stabilized operations, improved financial reporting, and closure of major legacy issues.

• Achieved R160–R200 million in cost savings, with benefits expected to flow into FY25.

• Restructured business and rationalized legal entities to drive efficiency and set a foundation for growth.

• Board subcommittee established to oversee turnaround and growth strategy, focusing on cost reduction, revenue growth, and capital allocation.

• Investment for future growth has resumed, with a focus on talent and efficiency.

Financial highlights

• FY24 total revenue was R6,035m, down 3.6% year-over-year; revenue excluding legacy entities was nearly flat at -0.3%.

• Gross profit margin was 27.3%, slightly down from 27.9% in FY23.

• Adjusted EBITDA at R307m, down 1.4% year-over-year; EBITDA margin stable at 5%.

• Net finance costs reduced by 28% to R118m; headline loss per share improved 99% to R0.0021.

• Cash from operations R171m; closing cash and accessible facility at R436m.

Outlook and guidance

• Expecting R160–R200 million in cost savings into FY25 from restructuring.

• Healthy pipeline and robust forward load for FY25, especially in business units with shorter conversion cycles.

• Positioned for growth with improved economic conditions, higher business confidence, and no load shedding.

• Focus on debt reduction and working capital management before resuming significant investments or acquisitions.

• Strategic focus on liquidity, cost optimization, sales productivity, and growth.