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Stals defends closed-shop polic... Smallest entrepreneurs deserve a fair ch... Consumers face 16 new taxes and levie... Crime propels brain drain of top executi... Latin America to get lion's share of min... Ten years on, looking for new worlds... |
Ten years on, looking for new worlds to conquer
APPLIANCES
APPLIANCES manufacturer, importer and exporter Nu-World is a survivor of the 1987 listings boom and stock market crash. This year, its 10th as a listed company, could prove to be one of its best, says managing director Michael Goldberg. At a price:earnings ratio of 42.5 and with compound earnings growth of 45% a year, expectations of the company are high. Nu-World listed in 1987 with sales of only R12-million. Since then, sales have grown by around 40% a year and 1996 was no exception. In the year to August, turnover was 42% up at R247-million and in the current year, sales should increase by around R100-million or about 40%. Attributable earnings have grown by 45% a year over the last five years and in the year to August, earnings were 73% higher at R9.3-million. Interim results to end-February indicate the company is on track to continue its sales and profit record. Turnover was 35.5% up at R148.2-million and attributable income jumped 52% to R4.3-million. In line with earnings growth, the share's performance has been strong, doubling over the last year to R26.50. Nu-World was ranked first in the Financial Mail Top Companies in June. Goldberg says if one takes into account the increase in share price growth and dividends paid over the last five years, the annual average rate of return has been 120%. All the growth to date has been organic but with the addition of new brands and divisions. Future growth will come from new markets and possible acquisitions, mainly overseas. When Nu-World listed, it was only involved in manufacturing and importing small electrical appliances and electrical wiring accessories. Now its divisions include exports of manufactured appliances, JVC consumer electronics and white goods, including washing machines, fridges and ovens. Last year exports grew 50% and Nu-World now generates about 10% to 15% of turnover from exports of its own products, mainly to Africa, Australia and the UK. Goldberg says the JVC and white goods divisions are both new and operate in huge markets where the company has just scratched the surface. He says the consumer electronics market in SA is valued at over R3-billion. JVC now makes up "a sizeable portion" of Nu-World's turnover and there is scope for it to grow significantly.
To contain costs, the company has just commissioned a high pressure aluminium die-casting plant to produce its own sole plates for its steam irons.
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