The business

The Top Fix group has been in operation for the past sixteen years and focuses on the supply of scaffolding and scaffolding personnel to industrial plants and construction sectors, the supply of outsourced skilled labour to the chemical, petro-chemical, power generation, construction and coal mining industries, and the supply of safety surveillance and access control equipment to chemical and petro-chemical plants.

Performance

Results for the year ended 30 June 2010 were somewhat disappointing with headline vearnings dropping by 71.8% to 3.1 cents per share. The severe downturn in the construction industry impacted the scaffolding business severely with operating losses of R6.1 million. Consequently, goodwill relating to the Scaffolding Division was fully impaired which negatively effected earnings by R44 million. Personnel Outsourcing and Safety Surveillance generated strong results contributing R18.7 million to operating profit. Since June 2010, the Scaffolding Division remained under pressure as a result of the building recession while its Personnel Outsourcing and Safety Surveillance divisions continued their strong performance.

Prospects

The Scaffolding Division has made a strategic change to focus more deliberately on the petrochemical and energy generation industries as these offer less cyclical demand due to routine scheduled maintenance. Furthermore, any upturn in the building industry will result in a material increase in profits as the Scaffolding Division has been restructured to decrease its break even turnover. Personnel Outsourcing operations will continue to benefit from the local shortage of skilled artisans and is well positioned to take advantage of opportunities in South Africa.

Financial Highlights