Shares in JSE-listed Jasco slumped more than 17% on Friday, after the company issued a trading statement warning that, while earnings per share would be higher for the first six months, headline earnings would drop.
Stock in the group lost 17.16%, to 140c, a 29c decline on the intra-day high of 169c, which was a cent higher than its open. The share price hit a 52-week low of 112c last March, while its 52-week high was 175c, on 20 August last year.
Jasco Electronics Holdings says earnings per share for the six months to December should be between 55% and 60% higher than the 6.4c it reported for the first half of 2012. This puts earnings per share in the range of 9.9c and 10.2c.
However, headline earnings per share, which analysts see as a core indicator of performance, will be between 25% and 30% lower than the 6.9c in the first half of 2012. Jasco says headline earnings per share should be between 4.8c and 5.2c.
"While the group's core businesses performed satisfactorily, adverse market conditions severely impacted the performance of Lighting Structures and M-TEC, which reduced overall group profitability," says Jasco in a trading statement. The group has sold Lighting Structure to its international partner as of 1 December.
Jasco explains that the difference between earnings and headline earnings per share is due to the sale of property and the loss on the disposal of Lighting Structures, both of which have a once-off impact. Its results will be issued on Thursday.
Cleaner focus
A year ago, the group reported revenue 55% higher, at R493.9 million, after it integrated Jasco and Spescom. Net profit gained 193%, to R9.1 million, as the group exited the first six months of its three-year restructuring plan.
Jasco was restructured into three verticals: Information and Communication Technology (ICT) Solutions, Industry Solutions and Energy Solutions. Previously, the group had four units.
ICT Solutions contains the telecommunications and information technology businesses of Jasco, Spescom, ARC Telecoms, as well as the telecommunications arm of associate M-TEC. Industry Solutions contains the security business and recently-acquired FerroTech, with Energy Solutions containing Electrical Manufacturers and the since sold Lighting Structures, as well as the energy arm of M-TEC.
Jasco announced in September 2010 that it would buy Spescom for R11.8 million and 31.9 million new shares to create a R1 billion merged entity in the converged telecommunications space.
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