Automotive components and battery maker Metair expects higher revenue for the half-year to end-June, supported by acquisitions and improved performance in its vehicle components business.
In the statement on Thursday, the company said it expects total revenue to increase 52%-54%. The increase was driven by the consolidation of Hesto Harnesses from April, a company that assembles and supplies automotive wiring to vehicle manufacturers in SA, as well as a full six-month contribution from AutoZone, acquired in late 2024.
Metair expects earnings before interest and taxation (ebit) to come in at R440m-R460m, supported by improved volumes and ongoing recovery measures. However, the ebit margin is projected to fall 5.1%-5.3%, down from 6.2% a year earlier, largely due to anticipated losses from AutoZone, which remains in a post business rescue stabilisation phase.
AutoZone, acquired for R278.5m, helps expand Metair’s presence in the automotive aftermarket. The company said integration efforts are under way and have begun yielding operational efficiencies. Metair expects AutoZone to contribute more meaningfully to earnings from 2026.
“This AutoZone acquisition has strengthened our strategic positioning in the aftermarket sectors and provides a robust platform for future growth,” CEO Paul O’Flaherty said.
The company said growth in local vehicle production contributed to improved performance in the company's original equipment manufacturer (OEM) segment.
“While there is an obvious indirect impact on the SA economy, it is pleasing that we do not expect the tariff turmoil to have a direct impact on our OEM customers, as these customers do not supply into the US market,” O’Flaherty said.
The company said it concluded a capital restructuring plan in March 2025 aimed at reshaping its debt profile over the next five years in line with expected earnings and cash flow. This included refinancing debt of about R3.3bn for its SA subsidiaries (excluding Hesto) in April, and R1.4bn for Hesto in June.
Metair expects to report a one-off capital loss of about R300m linked to the consolidation of Hesto Harnesses as a subsidiary from April. While this non-cash item will weigh on reported earnings per share, it will be excluded from headline earnings per share (HEPS).
For continuing operations, HEPS is projected at 69c-72c, down from 77c in the same period last year.
Including discontinued operations, HEPS is forecast at 63c-67c, an improvement from a headline loss of 3c in the first half of 2024.
The company expects to report full results on September 10.
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