LISTED diversified concern, Axia Corporation Limited has snapped up an additional 24,5% stake in cars and spare parts firm, Transerv for US$900 000 in a move geared towards maximising shareholder value. BY FIDELITY MHLANGA The acquisition was done through the group’s wholly-owned subsidiary domiciled in Mauritius, Excalibur Mauritius Limited. “The group increased its shareholding in Transerv from an effective 26,01% to 50,51%, with effect from January 1 2020. The acquisition was done through the group’s wholly-owned subsidiary domiciled in Mauritius, Excalibur Mauritius Limited, for a purchase consideration of US$900 000. Goodwill amounting to $15,63 million was recognised at the date of the transaction,” said Axia chairman Luke Ngwerume in a statement accompanying the company’s financial results for the period ended June 30, 2020. “This acquisition will enable Transerv to pursue strategies that maximise shareholder value with further alignment and support from the Axia group, which will enhance long-term returns. As a result, the group has consolidated the results of Transerv with effect from January 1 2020.” The group recorded $7,84 billion revenue during the year, a marginal decline compared to the prior period. It said the impact of inflationary price increases negatively affected demand, thus turnover volumes were below those traded in the prior year resulting in a decline in revenue. “An improved performance was noted in the last quarter of the financial year, where volume growth was better than that achieved in the prior year. The group sustained growth in profitability by recording an operating profit of $874,116 million, representing a 43% growth in the comparative period, despite the inflationary pressures on costs. The financial income line mainly comprised income earned on the derivative option, unrealised exchange gains on foreign-denominated cash and cash equivalents as well as profit on disposal of assets. Equity accounted earnings are mainly comprised of the results of Transerv for the first six months and Restapedic Bedding,” Ngwerume said. Basic earnings per share and headline earnings per share both improved by 494% and 481%, respectively. Profit after tax for the period was $636,63 million compared to $108,253 million recorded during the prior period. Net borrowings decreased by $481 million mainly as a result of increased positive cash and cash equivalent balances. The group generated cash of $1,1 billion from operations which was up 278% from the comparative period. The group’s capital expenditure for the year totalled $124,76 million and this was limited to critical maintenance and expansion projects as these were also affected by inflationary pressure. The group’s subsidiary, TV Sales & Home had a slow start to the year with subdued volumes in the first quarter which were later offset by improved trading in the second and third quarters. Turnover was 11% below the prior year, with volumes 23% below prior period. Quarter four performance was commendable despite not trading in the month of April