Antony Page, CEO of Protech Khuthele.
Antony Page, CEO of Protech Khuthele.

MINING services and equipment leasing group Protech Khuthele’s headline earnings per share rose to 3.9c, from a loss of 1c per share in the year to February.

Protech is the subject of a hostile takeover by Eqstra, a construction equipment leasing and contract mining group.

Eqstra last year launched a 60c per share takeover bid for the 67.2% stake of the company that it did not already own. Analysts have said the offer is far below the roughly 75c per share that Protech is worth.

In the year to February, Protech’s cash climbed 74% to R139m from R80m. Group revenue grew to R1bn from R966m. The group’s operating margin rose 4.5%. Its net asset value per share was up from 89.5c to 94.5c.

"Protech is pleased to report annual results for the year ended February 28 2013 which confirm that the turnaround is well on track, as evidenced by its return to profitability and strengthened financial position," the group said.

For management purposes, the group was organised into three major operating divisions: contracting, geotechnical laboratory and Readymix.

Contracting includes bulk earthworks, roads and civil engineering contractors, plant hire, impact compaction and logistical services. The geotechnical laboratory division houses geotechnical laboratory and surveying services, while Readymix supplies ready-mixed concrete and pumping services.

Market conditions in the construction and mining sectors, in South Africa and on the rest of the continent, remained largely unchanged, according to Protech CEO Antony Page.

He said that in public-sector infrastructure, long lead times on awarding new projects were made worse by funding constraints.

Protech was carefully building its civil engineering and earthworks resources to benefit from anticipated opportunities within this sector, targeting transport, particularly rail and road.

"In mining infrastructure, mining houses are increasingly segmenting projects into smaller packages. As a result an increasing number of smaller players submit tenders, putting pressure on margins," he said.

"This is countered by more stringent safety requirements that are creating a barrier to entry that plays to Protech’s strength, with its strong safety protocols and systems."

There were signs of recovery in the commercial and industrial sector. Through national expansion and by broadening its offerings, Protech aimed to continue to grow its ability to service this sector, the group said.

Outside South Africa, private-sector investment in new mining projects as well as general commercial and industrial infrastructure continued to create growth opportunities.

Protech said it maintained a "selective approach" in its core target areas of Zambia, Zimbabwe and Mozambique.