Our opinion on the current state of ALTRON-A(AEL)
Allied Electronics Corp, or Altron (AEL), is an information and communications technology company founded by Bill Venter in 1965. The company has been re-focusing on its core business by selling its 80% stake in Powertech and its 100% subsidiary, Altech UEC, a developer of set-top boxes. Powertech was sold to a BEE consortium, and Altron is currently in the process of selling CBI Telecom Cables.
Altron operates in six African countries, as well as the UK and Australia. The company announced that it had secured key wins in both the public and private sectors, including the Gauteng Broad Band Network phase 2 contract and FNB's data and analytics contract. Additionally, Netstar, a subsidiary of Altron, won a three-year contract with eThekwini for vehicle tracking of 7,000 vehicles. Bytes, a UK-based subsidiary that has now been unbundled and separately listed on both the London Stock Exchange (LSE) and the JSE, secured a five-year contract for Windows 10 with the NHS (UK).
Altron has been restructuring its debt to reduce interest expenses and has resumed paying dividends. The company also acquired Phoenix Software in the UK for R698 million. On 17th December 2020, Altron successfully listed its subsidiary Bytes Technology on the LSE at a price of GBP2.70, unlocking significant value for Altron shareholders, though this resulted in a notable drop in the Altron share price chart.
In its results for the year to 29th February 2024, the company reported revenue up 8% and headline earnings per share (HEPS) up 36%. The company also reduced its debt by 44% to R313 million during the period. Altron stated that "Increased cash generation supported by a strong balance sheet allowed us to increase our final dividend per share by 74%." In a trading statement for the six months to 31st August 2024, the company estimated that HEPS would rise by at least 20%, citing that "positive momentum has continued into the 2025 financial year ("FY25"), leading to a stronger year-to-date performance in comparison to the Comparative Period, which was negatively impacted by provisions and impairments raised."
Technically, the share had been moving sideways between 750c and 1330c from December 2020 until November 2023. It has since entered a new upward trend and has been rising strongly. The share was added to the Winning Shares List on 15th November 2023 at 949c and has since risen to 1720c.
Altron operates in six African countries, as well as the UK and Australia. The company announced that it had secured key wins in both the public and private sectors, including the Gauteng Broad Band Network phase 2 contract and FNB's data and analytics contract. Additionally, Netstar, a subsidiary of Altron, won a three-year contract with eThekwini for vehicle tracking of 7,000 vehicles. Bytes, a UK-based subsidiary that has now been unbundled and separately listed on both the London Stock Exchange (LSE) and the JSE, secured a five-year contract for Windows 10 with the NHS (UK).
Altron has been restructuring its debt to reduce interest expenses and has resumed paying dividends. The company also acquired Phoenix Software in the UK for R698 million. On 17th December 2020, Altron successfully listed its subsidiary Bytes Technology on the LSE at a price of GBP2.70, unlocking significant value for Altron shareholders, though this resulted in a notable drop in the Altron share price chart.
In its results for the year to 29th February 2024, the company reported revenue up 8% and headline earnings per share (HEPS) up 36%. The company also reduced its debt by 44% to R313 million during the period. Altron stated that "Increased cash generation supported by a strong balance sheet allowed us to increase our final dividend per share by 74%." In a trading statement for the six months to 31st August 2024, the company estimated that HEPS would rise by at least 20%, citing that "positive momentum has continued into the 2025 financial year ("FY25"), leading to a stronger year-to-date performance in comparison to the Comparative Period, which was negatively impacted by provisions and impairments raised."
Technically, the share had been moving sideways between 750c and 1330c from December 2020 until November 2023. It has since entered a new upward trend and has been rising strongly. The share was added to the Winning Shares List on 15th November 2023 at 949c and has since risen to 1720c.
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