The business

Precrete specialises in production and distribution of premixed concrete for construction support and other safety related mining applications predominantly in the platinum sector. Its wholly-owned subsidiary, GFC Construction (Pty) Ltd ("GFC"), focuses on shotcreting, which involves applying concrete pre-mixes to walls of mine shafts. Precrete also recently invested in Green Square Mining and Mining Contracting (Pty) Ltd, a mining subcontractor in the Rustenburg area of South Africa.

Performance

Precrete achieved a 25.6% increase in headline earnings to R44.1 million. This was on the back of strong revenue growth due to higher volumes and prices for both bags and shot crete. Revenue was further boosted by good results from Precrete's mine support and safety division. Operating margins decreased as a result of rising input costs of fuel and electricity and also the mine support and safety divisions which have lower margins.

Prospects

Management is optimistic about the platinum sector and believes that Precrete is well positioned to gain from the positive outlook in the South African mining sector. Their focus will remain on special projects for mining houses and other industrial blue chips as this will significantly enhance earnings.

Financial Highlights