November 26, 2019 / 6:38 AM / 15 days ago

UPDATE 1-South Africa's Omnia Holdings swings into interim profit

(Adds detail, CEO quote)

JOHANNESBURG, Nov 26 (Reuters) - South African chemicals and fertiliser maker Omnia Holdings reported a half-year profit on Tuesday boosted by its mining division, despite difficult trading conditions in its agricultural business.

The firm, which also produces explosives, posted a headline earnings per share (HEPS) - the main profit measure used in South Africa - of 49 cents per share for the six months ended on Sept. 30. That compares with a loss of 122 cents per share during the same period a year earlier.

Omnia said that during the half-year period its agricultural division experienced difficult trading conditions due to subdued commodity prices.

Its mining business, however, was supported by higher bulk volumes in South Africa, improved profitability in mining chemicals and new international business.

Revenue for the six months was mostly flat at 8.723 billion rand ($593.10 million) from 8.654 billion rand in the year-ago period.

A slowdown in the manufacturing and mining sectors and drought conditions have weighed on Omnia’s business, which produces various chemicals and industrial products, fertilisers and explosives.

“The business has been stabilised following the recapitalisation of the Group through a successful rights offer, but more work lies ahead,” Chief Executive Officer Seelan Gobalsamy said in a statement.

The climatic conditions and the sectors that Omnia services are increasingly unpredictable and volatile, he added.

Omnia, which has been battling high debt after raising funds for two acquisitions and the construction of a fertiliser plant, raised 2 billion rand ($130 million) through a rights issue.

Net debt decreased by 1.4 billion rand to 3.3 billion rand, the company said.

Omnia said it was continuing with a review of its markets and assets, which will include identifying and disposing of non-core assets as it looks to further strengthen its balance sheet. ($1 = 14.7075 rand) (Reporting by Tanisha Heiberg; Editing by Tom Hogue and Shailesh Kuber)

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