March 24, 2022: Metair posted increases in revenue and operating profit in full-year results reported on March 17 — reflecting a solid rebound, it said, after pandemic lock-down restrictions two years ago.

The South Africa-based group, whose businesses include lead and lithium battery products and automotive components, said overall revenue increased by 23% to ZAR12.62 billion (about $862 million).

Group operating profit rose to ZAR1.16 billion from ZAR0.6 billion in the previous period, with the operating margin at 9.2%, compared with 5.5% in 2020.

Earnings before interest, tax, depreciation, and amortization (EBITDA), including equity earnings and impairments, increased by 80% to ZAR1.4 billion.

Trade-focused

Metair’s energy storage division mostly comprises its battery businesses in countries including Turkey (Mutlu Akü), Romania (Rombat) and South Africa (First National Battery).

Sales in the energy storage business were up 18%, contributing revenue of ZAR7.5 billion for 2021 over the previous year.

Energy storage earnings before interest and tax (EBIT) rose by 51% to ZAR887 million, with operating profit in local currency showing an improvement at South Africa’s First National Battery and more than doubling at the Mutlu Akü lead batteries operation in Turkey.

Sales of industrial batteries were ZAR530 million, with First National Battery continuing with its shift to a trade-focused model to counter the effect of technology, market and demand shift, Metair CEO Riaz Haffejee (pictured) said.

He said sales beat pre-covid levels, supported by strong aftermarket demand and exports from Mutlu Akü.

And Haffejee said Metair is developing smaller auxiliary lead acid AGM batteries to power the non-starting functions of new energy vehicles.

Challenging

“Demand for lead acid batteries will grow and is likely to continue into the next decade, based on forecast internal combustion engine growth and their applicability as auxiliary batteries in new energy vehicles,” Haffejee said.

But he warned the trading environment would remain challenging during 2022 because of supply chain difficulties and semi-conductor shortages — all expected to be compounded by the Russia-Ukraine conflict.

The company has yet to respond to claims made by one of its shareholders, Truffle Asset Management, that Metair is preparing to sell of its battery businesses as reported by BESB in February

However, Haffejee noted in his results report Metair continued to review its businesses and was committed to “driving the value unlock opportunity within the energy storage vertical”.