The Investor - Moneyweb's monthly investment magazine Issue 4 | Page 23

Revenue 2014 Operating profit 2014 Revenue 2103 Operating profit 2013 Waste management 676 330 46 024 529 761 23 736 Compost manufacture 40 989 (1 215) 42 855 (6 553) Landfill management 117 155 39 207 115 626 33 269 TOTAL 834 474 84 016 688 242 50 452 " We could drive earnings up tomorrow if we stopped investing in greenfield operations for the future, André Broodryk, group financial director At earnings per share level the growth figures were lower (11.2cps, up 31% from 8.5cps in the previous comparable period) as a result of the increased number of shares in issue following the capital raisings in 2013 and 2014. In 2013 the company raised R50 million and last November it raised a further R91 million through share placements. Hubbard expects earnings for 2015 to increase by 13.6% to 12.5c. “This is slower growth than we would have expected, but manufacturing in SA has slowed down.” This is not a major concern. “This is a different company to what it was four to five years ago,” he says. “It was always innovative and entrepreneurial, but there were ongoing accounting issues – impairments and write-offs. These have been resolved. “We have put in proper accounting systems, changed auditors and added some corporate governance,” adds Broodryk. “We don’t fight the numbers anymore.” The management team has also turned its attention to geographic expansion and has established bases in Mozambique, Tanzania and Kenya. “There is so much opportunity – from the oil industry as well as other multinationals,” says McNeil. “None of those countries have hazardous waste facilities – yet all of them are producing it.” The market is there, and is growing. With the right combination of scientific advancement, capital allocation and progressive sales Interwaste should continue to enjoy annual double-digit growth. Not bad for a company on a PE of  10.8. ■ ISSUE 4 – JULY 2015 23