Vehicle components and aftermarket group Metair reported mixed production trends among its major original equipment manufacturer (OEM) customers in the first half, with lower volumes at Ford offset by higher production at Toyota and Volkswagen.
Volumes associated with Ford were 25% lower at 46,193 vehicles, or 15,366 fewer units than in the corresponding period a year earlier. Toyota’s volumes increased to 66,074 vehicles from 64,011, while Volkswagen’s rose to 80,401 from 70,244.
Metair CEO Paul O’Flaherty on Wednesday said Toyota’s higher volumes came despite the switch to the new Hilux model. The group expects Toyota volumes in the second half to be at least in line with the first half.
Metair CEO Paul O’Flaherty (Supp)
The mixed customer performance came as Metair reported a 1% increase in group revenue to R8.5bn for the six months to end-June, while ebitda rose 8% to R760m. Headline earnings per share increased 11% to 72c. Once again, no interim dividend was declared.
Metair’s two main operations are supplying automotive components to vehicle manufacturers for use in new vehicles and selling replacement parts for vehicles already on the road. The group operates in South Africa and Sub-Saharan Africa, with vehicle component manufacturing accounting for 67% of revenue and aftermarket parts and retail for 33%.
Revenue from the OEM segment increased 4.4% to R5.73bn.
The group generated R188.6m in cash from operations, compared with an outflow of R122.1m in the prior-year period. Cash increased to R620m from R143m, while net debt fell to R4.3bn from R5.1bn.
Metair has also extended the term of its South African debt by five years and is finalising a refinancing for Hesto, its 74.9%-owned South African business that makes electrical wiring and dashboard components for vehicles.
Metair said the restructuring it started in February 2024 to stabilise the business was substantially complete. O’Flaherty said the group would continue to review its operations as market conditions change but was now focused on profitable growth.
The aftermarket business recorded revenue 5% lower at R2.81bn, with Metair citing competition in the market, especially for batteries.
The company said AutoZone’s return to profitability is about six months behind expectations. Metair acquired the vehicle parts retailer in December 2024 while it was emerging from business rescue, and the business subsequently went through a stabilisation and turnaround process. It returned to monthly profitability in May, according to the company.
O’Flaherty said Metair had changed the entire management team at Autozone to bring a new focus and prioritisation to the business.
The company said it is reviewing the footprint of its battery business and has appointed a permanent team to expand its aftermarket operations elsewhere in Africa.
O’Flaherty said the group wanted to balance its OEM and aftermarket businesses while retaining its role as a manufacturer supplying vehicle manufacturers and growing its aftermarket operations.
Business Day