Bloomberg News

Kapsch Says South African Toll-Road Revenue Boost Coming in July

June 11, 2013

Kapsch TrafficCom AG (KTCG), the Austrian maker of toll-road systems, said it would get an annual revenue boost of more than 50 million euros ($66.4 million) from a delayed South African project that may start next month.

“All judicial and parliamentary hurdles are out of the way,” board member Andre Laux said at a press conference in Vienna today. The system, which has faced opposition from road users, labor unions and car rental agencies, is expected to go live by mid-July, he said.

The South African government plans to charge road users in Gauteng, South Africa’s most populous province, after hundreds protested against the project in Johannesburg and the capital, Pretoria. The South African National Roads Agency SOC Ltd., or SANRAL, borrowed about 20 billion-rand ($2.2 billion) to build and improve roads in Gauteng without the tolls.

The tolling system “is currently working,” Vusi Mona, head of communications at SANRAL, said in an e-mailed response to questions. “Official toll commencement date has not yet been communicated, it will be communicated soon.”

Kapsch’s shares rose as much as 2 percent in Vienna and traded 0.6 percent higher at 38.88 euros by 2:46 p.m. The stock has declined 18 percent this year.

Satisfactory Profit

Kapsch posted three straight quarterly losses in the year ended March 31 that were partly caused by the delays in South Africa, the continent’s biggest economy. Net income for fiscal year 2012/13 declined 39 percent to 16.7 million euros after a “satisfactory” fourth-quarter profit, Kapsch said in a statement today.

The South African system will provide annual revenue of “significantly more than 50 million euros” for eight years, Kapsch’s Laux said. Total revenue in the last fiscal year fell 11 percent to 488.9 million euros. The company doesn’t disclose margins for individual projects, Chief Executive Officer Georg Kapsch said at the press conference.

The company will cut its dividend by 55 percent to 40 cents per share, compared with 90 cents a year earlier, it said. “We want to come back at least to an amount where we were three years ago,” Kapsch said. In 2010, the company paid a dividend of 75 cents per share, according to data compiled by Bloomberg.

To contact the reporter on this story: Alexander Weber in Vienna at aweber45@bloomberg.net

To contact the editor responsible for this story: Mariajose Vera at mvera1@bloomberg.net


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