EOH announces Annual Results

In brief:

• Group revenue increased by 43.5% to R2,429 billion (2010: R1,692 billion)
• Profit before tax increased by 56.5% to R234 million (2010: R150 million)
• Headline earnings per share up 35.2% to 197.6 cents (2010: 146.1 cents)
• Cash up 20.5% to 322 million (2010: 266 million)
• Dividend up 33.3% to 48 cents (2010: 36 cents)

EOH, one of South Africa’s top three IT service providers and largest enterprise applications provider in South Africa, announced impressive annual results for the period ended 31 July 2011.  The company aims to continue growing organically and via strategic acquisitions. The main growth areas include managed services, cloud computing, public sector, Business Process Outsourcing (BPO) and Africa.

EOH reported revenue growth of 43.5% (R2,429 billion), comprising of 60% organic growth and an additional 40% growth stemming from acquisitions.  EOH has also shown an increase in profit before tax of 56.5% (R234 million) and an increase in headline earnings per share of 35.2% (197.6 cents).

EOH is receiving recognition as a leading IT and Business services provider, having been ranked fourth in this year’s Financial Mail Top 200 Companies survey.  “Our 13 years of continued compounded annual growth in excess of 40% is largely attributable to EOH’s on-going passion for employing the best people in the industry.  Our people are further supported by a thoroughly competent leadership team.  EOH’s entrepreneurial spirit and business model have also allowed us to remain agile,” says Asher Bohbot, Chief Executive Officer of EOH.

The IT industry is valued at 75 billion Rand and is growing at a rate of 7.5% annually, leaving EOH with substantial opportunities to grow its market share.  Bohbot says four major trends are changing the landscape of the IT industry as we know it:

• Business is moving their in-house IT function to service providers such as EOH.
• Cloud computing will continue to develop and grow fast.
• Everything as a Service (EAAS) will be more and more available.
• Previously independent technologies are converging.

EOH’s on-going efforts for sustainable transformation find the company’s black shareholding at 30.7%.  Of the group’s 3 200 employees, 53% are black as is 60% of the board. EOH has an ‘AA’ BEE rating and is a level 3 contributor. On the Corporate Social Investment front, EOH has embarked on a multi-million Rand program to train teachers in math and science in many schools on the East Rand.

One of the burning issues that will be at the heart of EOH’s corporate citizen responsibility for the next financial year: is job creation.  “There are more than eight million unemployed people in South Africa and I strongly believe that the private sector is not doing enough to help government in this regard,” says Bohbot.  “Sustainable job creation can only be done by business and not government.  Therefore business needs to take the reins and get actively involved.  Business is capable of creating jobs and further believe that it is in our own best interest to do so.”

“As a result, EOH has taken the initiative to form a team that will work closely with our top 300 clients and business partners to generate ideas and meaningful plans for job creation,” says Bohbot.  Skills development and training of young people will be a strong focus point, an additional skill is an additional job.  The company will also work jointly with Government Departments to mobilise existing and new job creation initiatives.