Transaction Capital takes 48% profit hit after downsizing taxi business

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Transaction Capital opted to skip dividends after booking a R2.1 billion headline loss in its SA Taxi business for the six months to 31 March 2023. Moneyweb BusinessNews

Transaction Capital opted to skip dividends after booking a R2.1 billion headline loss in its SA Taxi business for the six months to 31 March 2023. The 46% drop in the group’s core earnings at the half way stage to R353 million will have a knock-on effect for the full year, although CEO David Hurwitz says the objective is to take the pain in one go and position the group for growth in the second half.

Some 56% of the division’s revenue now comes from services that are light on capital and can be delivered from SA, where costs are low relative to other parts of the world. Taxi business refocused The SA Taxi business remains the problem child, a victim of the damage inflicted by Covid lockdowns, floods and civil unrest in Kwazulu-Natal and Gauteng, and rising taxi and fuel prices. By early 2023, it became clear that the taxi industry would not quickly recover to pre-Covid levels any time soon.

 

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