Omnia flags a return to profit


Omnia flags a return to profit

Published Date: 2019-11-20 | Source: Stephen Gunnion | Author: Stephen Gunnion

Omnia flags a return to profit

Following last year's big loss and its recent capital raise, the chemicals, fertiliser and explosives group has delivered some positive news.

Omnia's shares rose as much as 20% yesterday after it said it would report a first-half profit, after last year's dire numbers.

In a trading statement, the chemicals, fertiliser and explosives group said earnings per share (EPS) for the six months to end-September would improve to between 30c and 42c from last year's interim loss of 138c. Headline EPS would increase to 42-52c from a 140c loss previously.

Omnia was forced to raise R2 billion through a deeply discounted rights issue in September to recapitalise its operations and shore up its balance sheet. It faced rising interest costs after building up debt to pay for acquisitions and fund its expansion. The group has also been plagued by exchange rate volatility, low prices for key agricultural commodities, economic challenges and an unstable political climate. A decrease in commodity prices and declining demand resulted in a general slowdown in the chemicals sector.

It expects to release its results on 26 November. Its shares retraced some of their gains to close 9.6% higher at R30.14.

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