Grindrod expects to complete the process of unbundling its shipping business in the first half of 2018, according to executive chairman Mike Hankinson.
“We have appointed professional advisers in and outside of South Africa in the fields of shipping, legal and financial to work with us on the unbundling of the shipping business onto an international exchange that supports shipping groups with an inward listing into South Africa,” he said.
Hankinson pointed out that the Grindrod Board had, for many years, reiterated the intention to separate the shipping concern as it did not believe that the value of the business was fairly reflected in the Grindrod share price.
Yesterday (Wednesday), Grindrod released its interim results for the period ending 30 June 2017, highlighting that stronger commodity markets had impacted positively on the EBITDA (earnings before interest, tax, depreciation and amortisation) of R640.4 million – inclusive of joint ventures, and excluding rail assembly businesses – compared to the R246.4 million of the same period last year.
The Johannesburg Stock Exchange-listed group pointed out in a statement that the closure of the rail assembly businesses which were held for sale had resulted in a headline loss of R128.9 million for the 6-month period ending 30 June 2017 – a 66% improvement compared to the previous year’s headline loss of R381 million.
The Ports & Terminals division saw strong profitability with volumes handled in the dry-bulk terminals increasing by 62 %. Hankinson added that capacity in the Matola and Richards Bay dry-bulk terminals was fully contracted for the remainder of the year. He said the logistics business had also shown a good turnaround.
The Grindrod Board has for many years reiterated the intention to separate the shipping business from the balance of the group as it does not believe that the value of the shipping business is fairly reflected in the Grindrod share price.
“With the focus on the freight and financial services businesses, the stronger mineral commodity exports, improved shipping markets and the planned offshore listing of the shipping division, Grindrod is looking forward to an exciting second half of the year,” said Hankinson.
