Half Year 2025 iOCO Ltd Earnings Call Transcript
Key Points
- iOCO Ltd (EOHHF) achieved a 150% increase in EBITDA, reaching ZAR252 million from ZAR97 million last year.
- Gross profit grew by 2.8% despite a 6.4% decline in revenue, indicating improved efficiency and contract execution.
- The company successfully reduced operating expenses by 26.5%, contributing to a significant improvement in profitability.
- iOCO Ltd (EOHHF) turned headline earnings per share from a loss of $0.11 to a profit of $0.19 per share.
- The company achieved a strong cash conversion of EBITDA, allowing for significant debt reduction and improved liquidity.
- Revenue declined by 6.4%, primarily due to lower infrastructure and hardware sales and reduced public sector contributions.
- The company is still in the process of completing its cost-cutting measures, with some further efficiencies yet to be realized.
- iOCO Ltd (EOHHF) faces challenges in recovering public sector revenue, which has decreased from 14% to 11% of total revenue.
- The company has a history of leadership changes, raising concerns about stability and continuity in the executive team.
- Despite improvements, the company still has a significant amount of debt, with a focus on further debt reduction before pursuing acquisitions or share buybacks.
So welcome to the iOCO first half 2025 results call. I'm Rhys Summerton. I'm the co-CEO and I look forward to, taking you through the results with Ashona, who's our CFO. So, if you just take a look at slide 3, iOCO clearly has a history and it's got a long history. And it did a lot right, and it did a long a lot wrong. But when we, and when I say we, I'm talking about Dennis, my Co-CEO and myself, when we discovered iOCO in June 2024.
We found a group that had a lot of revenue. It was generating ZAR6 billion of revenue a year, which actually puts iOCO in the top quartile of all revenue generators on the JSE. And yet its market value was in the bottom decile of all companies. It had a lot of revenue, but not a lot of market cap. So, what we had to do is kind of find out how we could get the profitability up because it was lossmaking at that point.
And try and drive the change from being a business with a lot of revenue and no profit to being a business with a lot of profitability. And so, Dennis and I set about a three-point
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