In 2019, chemical and fertiliser company Omnia raised R2-billion – or R20/share – from shareholders to fortify the balance sheet and buy the time management needed to execute their turnaround plan. Debt threatened to overwhelm the company and shareholders were justifiably disgruntled.
Over the past two financial years, Omnia has returned R14 of that R20 through dividends and special dividends, with the latest being the 275c dividend and 525c special dividend announced with the publication of the group’s annual results for the year“Management is adamant that the R20/share that shareholders gave them a few years ago to bail them out of what was their darkest hour will be fully repaid,” says“The rise in the share price [R36 June 2019 – R75 June 2022] and the return of capital...
In keeping with its disciplined approach to capital allocation, Omnia divested from Umongo Petroleum for about R1.1-billion. The proceeds from the disposal, together with improved operating cash generation across the company, resulted in a strong cash position of R2.4-billion at year-end.ammonia, potash, potassium and ammonium nitrate used in the manufacture of explosives
The fly in the agricultural ointment, he says, is the hyperinflationary environment in Zimbabwe, which causes big, volatile swings in the earnings of the agriculture business which – with revenues of R11.2-billion – dwarfs the mining business and chemicals business . “They are seeing benefits across every value chain they operate in – agriculture, mining, humates in Australia, and Protea Chemicals.”“The world is becoming cleaner and greener and people care about what nutrients are put into the soil. There is growing demand for more ethically produced, natural plant nutrients.”
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