EOH is pleased to report sustained operating profitability during the 6 months ended 31 January 2023 and the subsequent deleveraging of the Group’s balance sheet post the capital raise after the half year end.

Highlights for the period include:

  • R110 million in operating profit from continuing operations, compared to the R100 million for the full year end 31 July 2022
  • Revenue from continuing operations increased 8% despite a challenging local operating environment
  • Gross profit margins remain stable at 29%
  • R48 million invested into the business as part of our GET strategy
  • R600 million new capital raised post half year end used to reduce debt levels to R673 million, creating an efficient capital structure and a significantly reduced interest charge going forward
  • Cash balances at 31 January 2023 of R234 million and a normalised debt structure with a single bank

Despite the challenging operating environment EOH achieved revenue growth of 8% for the period with sustained operating profitability. The largest operating division, Digital Enablement led the way with a 20% increase in revenue and 24% increase in EBITDA at improved margins. The international diversification strategy delivered benefits with the Middle East, Europe and UK businesses showing excellent growth of over 45% to R257 million. At 33% of our Digital Enablement revenues, the international operations are becoming key contributors.

The IT Infrastructure Services, Enterprise Apps & Software and Infrastructure Solutions divisions all saw pleasing revenue growth over 10%. The Operational Technologies business had a challenging trading period primarily due to delays and the inability to close SOE contracts, resulting in a 10% reduction in revenue. This business is fairly reliant on SOE’s and mining in South Africa but diversification initiatives have started with investments into West and East Africa through the exclusive AVEVA rights, as well as a focus on manufacturing and FMCG clients in South Africa.

With the improved operating performance and outlook in FY2022, the Board was able to approve an R80 million strategic investment into the  business of which R48 million has been invested in the first 6 months. Additionally the recent successful capital raise significantly reduces interest charges. Going forward, EOH will further accelerate its organic growth strategy, especially on the back of the pleasing results being seen on the initial investments.

Looking forward, the EOH executive and Board is excited with the momentum that has built over the past 6 months. Compared to the previous six month period (H2-2022) all key metrics have improved, with revenue increasing 5%, gross profit 13%, adjusted EBITDA 112% and profit after tax 82%.

Furthermore, with the completion of the asset disposal process to deleverage the company, EOH now has a stable portfolio of businesses with a coherent go-to-market strategy. The Group will approach the market through four key product pillars; namely Digital Enablement, IT Infrastructure Services, Operational Technologies and EasyHQ. The International business outside of Sub-Saharan Africa will focus mainly on Digital Enablement and selling of own IP Platforms. The Executive Committee has also been aligned along these pillars, improving efficiency and accountability in our reporting structures.

Stephen van Coller, EOH Group CEO commented: “Having successfully completed our capital raise to normalise EOH’s capital structure, I am excited we can now turn our full attention to our Growth-Efficiency-Talent strategy. Our initial growth investments are showing great results and we will continue to build on this momentum, whilst maintain our focus on cost efficiencies and making EOH the employer of choice in the IT industry. We look forward to the next phase of our journey working with our many clients to enhance their business through industry leading information and digital technologies.”

For the SENS announcement please follow the link https://www.eoh.co.za/investor-relations/sens/ and to view our results presentation please follow the results presentation link


5 April 2023

For any media queries please contact:

Aprio Strategic Communications

Michael Rubenstein