Technology group Mustek's full-year earnings are expected to be as much as 80% lower reflecting tough economic conditions, reduced demand for green energy products and an impairment on its investment in Zaloserve.
The group's headline earnings per share is expected to be between 70% and 80% lower at between 75c and 112.5c.
Basic EPS is expected to be between 85% and 95% lower year on year, it said in a statement on Wednesday.
The difference between headline earnings and basic earnings is due to an impairment of the investment in Zaloserve (Sizwe IT Africa), which has been classified as an asset held for sale.
The group, valued at R776m on the JSE, is an assembler and distributor of ICT products. It was established in 1987 and listed in 1997. The bulk of its revenue comes from sales of hardware brands including Acer, ASUS, Samsung and Lenovo.
The group said the operating environment was marked by tough economic conditions and cautious market sentiment leading up to the general elections in SA.
Prevailing uncertainty froze corporate and government spending and the unexpected abatement of load-shedding abruptly ended the renewable energy boom, which had fuelled the group's growth last year. Reduced demand for green energy products put Mustek in a challenging situation with surplus stock in a tough macro-economic environment with high interest rates.
Net asset value per share is expected to be between 2,770c and 2,820c, compared with 2,724.36c a year ago.
The company expects to release its financial results on September 19.
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