Wrap Text
RAUBEX GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2006/023666/06)
JSE Share code: RBX
ISIN: ZAE000093183
("Raubex" or "the Company" or "the Group")
VOLUNTARY TRADING UPDATE IN RESPECT OF THE SIX-MONTH PERIOD ENDED 31 AUGUST 2025
Shareholders are advised that Raubex expects both its earnings per share ("EPS") and headline earnings per
share ("HEPS") to be between 10% and 20% lower, respectively, than the EPS and HEPS from the previous
corresponding period. This translates to EPS being between 228.8 cents and 257.4 cents (1H2025: 286 cents
per share) and HEPS being between 227.4 cents and 255.9 cents (1H2025: 284.3 cents per share) for the six
months ended 31 August 2025.
While performance for the period reflects a decline compared to the prior year's six months, the Group
remains focused on long-term value creation, underpinned by a resilient business model and a clear strategic
direction.
Roads and Earthworks Division
The Roads and Earthworks Division delivered a strong performance during the period under review, with an
increase in operating profit. This growth is primarily attributable to the effective execution of the division's
project pipeline.
Major SANRAL projects are operating at full capacity and performing exceptionally well. Execution of the
Group's various concession contracts is progressing smoothly and remains on schedule.
The division benefited from a positive increase in the awarding of new SANRAL tenders during the reporting
period. Notably, the Group recently secured two significant contracts, namely:
- the R3.22 billion contract to upgrade the N2 route between Mkhondo and Bloemendal; and
- the R2.36 billion contract for improvements along the N2 between Ermelo and Camden.
These new projects effectively replace completed work along the KwaZulu-Natal corridor of the N3, ensuring
continuity in the division's road construction pipeline and supporting sustained performance.
Construction Materials Division
The division experienced a slower start to the financial year compared to the same period last year, primarily
due to adverse weather conditions during March 2025 and April 2025, which impacted operations and reduced
contributions during those months.
The Aggregates business recorded lower-than-anticipated volumes in the first half of FY2026. However,
performance has begun to improve in line with better market conditions. The recently commissioned plant
upgrades in Gauteng are exceeding expectations, delivering enhanced production returns and significantly
improving both output and operational efficiency.
Operations in Botswana have performed well and continue to contribute positively to divisional results.
National Asphalt commenced the year with a relatively low secured order book. However, recent contract
awards have significantly strengthened the pipeline, and a strong performance is anticipated for the remainder
of the year.
Tosas delivered a robust performance during the first six months of the financial year, and this positive trend is
expected to continue through the second half.
The industrial minerals segment has been adversely affected by ongoing uncertainty surrounding the future of
smelters in South Africa, resulting in a sharp decline in bentonite sales during the reporting period.
On a more positive note, the agriculture segment benefited from a favourable rainy season, which led to a
substantial increase in gypsum sales. These gains have effectively offset the decline in bentonite sales.
Infrastructure Division
The division's strategy to concentrate on privately-owned renewable energy projects has begun to yield
positive results with a substantial increase in operating profit compared to the previous corresponding period.
Our flagship initiative in the building sector, the repair and upgrade of the Parliament buildings in Cape Town,
is progressing well and remains firmly on track.
The affordable housing projects continue to develop well as the South African property market is being
stimulated by the recent interest rate cuts. Sales in the Newinbosch development are outperforming
expectations, reflecting growing market confidence. With a noticeable uptick in property activity, the outlook
for 2026 remains positive.
The design and build of the mechanical and electrical works for the upgrade and expansion of the Potsdam
Wastewater Treatment Plant is ongoing and the project is on schedule.
To support our strategic objectives and diversify our income streams, we acquired Hlumisa Engineering
Services (Pty) Ltd ("Hlumisa"), effective 1 September 2025. Hlumisa has specialised expertise in mechanical
and electrical engineering, with a strong emphasis on water and wastewater treatment. This capability aligns
seamlessly with our ongoing work on the Potsdam Wastewater Treatment Plant and strengthens our position
in the infrastructure and environmental services sector.
Materials Handling and Mining Division
The Materials Handling and Mining Division is expected to report a decline in operating profit for the period
under review.
This follows significant operating losses of R351 million in the chrome operations during the second half of the
previous financial year, driven by a sharp drop in chrome prices. Although low prices persisted into the first
two months of the current financial year, a recovery in chrome pricing enabled mining operations to achieve
break-even performance for the current six-month period. The strengthening of the Rand against the USD also
impacted profitability negatively.
At Kookfontein, production was scaled back at the end of last year but successfully ramped up to full capacity
towards the latter part of the reporting period. During 1H2026, modifications were implemented at the
processing plant to optimise performance. These enhancements are expected to increase plant capacity and
improve overall efficiency and output in 2H2026.
A key milestone was the successful commissioning of the PGM plant at Kookfontein, with the first full month of
production recorded in August 2025. Sales of PGMs are anticipated to commence in the second half of the
financial year, providing a meaningful boost to divisional performance.
At Moeijelijk mine, a new underground contractor began operations in April 2025 and has been performing in
line with production targets. Full production capacity is expected to be reached in 2H2026, which will further
enhance performance for the remainder of the year.
While Bauba has demonstrated significant improvement compared to the latter half of FY2025, management
is currently evaluating the long-term strategic direction of the business.
Other operations within the division performed well during the period. Notably, the Namdeb contract, which
provides mining services to Southern Coastal Mines in Namibia, delivered a strong contribution. In
Mozambique, despite ongoing force majeure restrictions, operations resumed in the latter part of the first half
and contributed positively to regional performance.
B&E International delivered a solid performance in 1H2026, supported by several start-up contracts that are
expected to gain momentum in the second half of the year.
Both B&E International and SPH Kundalila operations at Kookfontein and Moeijelijk mines performed well
throughout the period.
The collaboration among the Group's five divisions continues to present significant opportunities for Raubex,
Australia Division
The Australia Division experienced a mixed first half, marked by both challenges and encouraging
developments across its portfolio. The division will report an operating loss for the period under review,
primarily due to a single underperforming project.
Raubex Construction Australia encountered substantial challenges on its largest active project, which was
terminated for convenience at the end of September 2025. The resulting financial impact, a loss of
approximately R210 million, has been fully recognised in the first half of FY2026. Management is currently
assessing potential claims on the project, which, if successful, could lead to a partial recovery of losses. This
was an isolated incident, and the company has taken decisive steps to apply lessons learned and implement
mitigating actions.
Importantly, Raubex Construction Australia's other projects remain profitable, with several contracts
performing well. The company continues to deliver value through long-standing relationships with clients and
has secured new work with various clients to improve the order book pipeline.
Westforce Construction delivered an exceptional performance in the first half, exceeding budget expectations.
The company continues to expand its footprint in the renewable energy and battery storage sectors and is well
positioned for another good performance for the year.
Roadmac Australia, a relatively new entrant in the market, is steadily gaining traction. The business has begun
delivering profitable projects and is building a strong reputation in the road sealing sector.
Additionally, Axis Mineral Services, a recent acquisition, is expected to make a positive contribution to full-year
results, further supporting the division's recovery. Axis Mineral Services is a contract crushing business which
will be complementary to the other businesses within the division.
Management remains confident in the division's ability to contribute positively to the Group's performance in
the second half of the financial year and beyond.
Despite the challenges experienced during the first six months, the Group remains confident about the outlook
for the remainder of the financial year and the years ahead. Our secured order book has reached record levels,
providing a strong foundation for future performance. In addition, we continue to see significant opportunities
to further grow the order book, supported by positive developments in the South African construction market
and various government and Public Private Partnership (PPP) infrastructure initiatives. Raubex' diversification
strategy has remained a fundamental driver of the Group's performance.
The Group has maintained a strong balance sheet and a healthy cash balance throughout the year and
combined with its diversified operations and strong leadership; it is well positioned to extract value from
future opportunities.
The financial information on which this trading update is based has not been reviewed or reported on by the
Company's auditors.
The release of the results for the six months ended 31 August 2025 is anticipated to be published on or about
10 November 2025.
Centurion
23 October 2025
Sponsor
Investec Bank Limited
Date: 23-10-2025 07:05:00
Supplied by www.sharenet.co.za
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
