South Africa’s largest services company takes a hit

Bidvest delivered decent results for the first half of its 2025 financial year, but its freight division, renewable energy products, and Adcock Ingram business weighed on the company’s performance.

Bidvest is one of South Africa’s largest conglomerates, contributing to various sectors and providing essential services to businesses and consumers alike.

The group includes over 205 businesses and more than 130,000 employees.

The company released its results for the six months through December 2024 on Monday, 3 March 2025.

These results revealed a decent performance, with revenue up 6% to R64.5 billion, while cash generated by operations grew by an impressive 18% to R4.5 billion.

The company’s profit for the period grew by just under 5% to R3.62 billion. Its basic earnings per share from total operations also grew by 5.8% to 1,016.1 cents per share.

However, the company’s basic earnings from continuing operations declined by 1.3%. 

Basic earnings from discontinued operations, which now includes Bidvest Bank, grew by over 1,000%. However, this was mostly an accounting effect due to the suspension of depreciation and prior-period impairments.

Bidvest’s trading profit remained relatively flat, declining by 0.5%, while its trading profit margin fell by 66 basis points to 9.7%.

Overall, four of Bidvest’s six divisions reported trading profit growth, with the company’s acquisitions in key strategic areas contributing positively.

However, the company’s Freight and Commercial Products divisions saw their trading profit decline in the six-month period, which Bidvest said it expected.

For the Freight division, an expected lack of maize exports and lower bulk mineral volumes impacted its profitability, which contracted by 11.9%.

The Commercial Products division saw its sales of renewable energy products drop sharply and also cited weak industrial demand as reasons for its 26.9% trading profit decline.

An unexpected drag on Bidvest’s results was Adcock Ingram, a healthcare company Bidvest owns a majority stake in.

Adcock’s trading profit declined by 17%, which the company attributed to declining consumer spending, reduced inventory holdings in the pharmaceutical wholesale channel, and the knock-on effect of factory underrecoveries.

Bidvets also reported on several strategic actions it took during the six-month period.

The company plans to exit the financial services segment, which includes classifying Bidvest Bank, FinGlobal, and Bidvest Life as discontinued operations.

The services giant also completed six bolt-on acquisitions, including Dekra (vehicle testing), WearCheck (condition monitoring), and Nexgen (UK facilities services).

These acquisitions saw the company’s net debt increase to R30.9 billion. This also led to net finance charges growing by 5.4% to R1.3 billion.

Looking forward, Bidvest expects challenges in trading conditions to continue but said it remains confident in the company’s diverse business model.

However, it added that, to date, structural reform frameworks and ambitions relating to South Africa’s infrastructure build have not translated into basic infrastructure spend and increased demand.

This is set to affect the company’s short-term growth prospects, but it said the projected spending and envisaged opportunities pose exciting growth prospects for the group over the medium- to long term. 

“What remains outstanding is action and project mobilisation,” it said.

Bidvest declared a dividend of 470 cents per share for the first half of its 2025 financial year, up 1% from the interim dividend it declared the year prior.