4Sight Holdings Ltd (JSE: 4SI) reported on 14 August 2023 that its implemented go-to-market strategy continues to deliver strong business performance, with the company maintaining its momentum from the previous financial year, again reporting double-digit growth in revenue and profit. Continued acceleration in digital transformation and cloud adoption on the African continent has much to do with this growth.

The company’s revenue for the six-month period under review increased by 37.1% to reach R451.3-million, compared to R329.2-million for the corresponding period in 2022, with revenue growth experienced from all business clusters.  The company’s maiden dividend declared at 2.5c per share is another milestone achieved by the 4Sight team.

“Since my appointment as CEO in November 2019, my focus remains driving innovation through product-focused digital transformation, with the support of our leadership team,” explains Tertius Zitzke, group CEO at the company. 

Zitzke says, “4Sight is the trusted advisor for our partners – both customers and vendors – and we deliver solutions based on their people, customer, operational, finance and product innovation requirements. This is what we refer to as the DNA for business transformation.”

Zitzke attributes the robust performances across every business cluster to the continued acceleration in digital transformation and cloud adoption on the African continent, as more companies look to the convergence of operational and information technologies with the business environment to ultimately embrace artificial intelligence (AI) to enhance productivity.

“4Sight’s continued investment into the artificial intelligence (AI) business case centres on automation and efficiency, data analysis and insights, cost reduction and resource optimisation, predictive analytics and productivity – that’s the real benefit, all based on accurate, real-time data. The Operational Technologies Cluster and the Channel Partner Cluster accounted for the largest contributions to our higher revenue,” explains Zitzke.

Nick Botha - chief Channel Partners, Tertius Zitzke – CEO and Wilhelm Swart - chief Operational Technologies of 4Sight. Image credit: 4Sight Holdings Ltd

Nick Botha – chief Channel Partners, Tertius Zitzke – CEO and Wilhelm Swart – chief Operational Technologies of 4Sight. Image credit: 4Sight Holdings Ltd

These factors helped 4Sight realise significant growth in operating profit, which increased by 121.1% to R26.8-million compared, to R12.1-million in the corresponding period last year.

Based on this performance, basic earnings per share increased from 1.287 cents cents per share (197.4%), and headline earnings per share rose from 1.288 to 3.828 cents (197.2%).

According to Zitzke, the significant improvement in profitability stems from the company’s ability to position the distinct solutions and technologies available from the company’s four business clusters and the continued focus on industry verticals.

“Each cluster is focused on targeted industries and leveraging unique IP-based solutions while bolstering delivery with deep domain skills that enable and sustain significant sector-specific growth.” 

“The Channel Partner (CP) Cluster, which delivers solutions indirectly via 800+ partners in Africa and the Mid-East, grew operating profit by 90% compared to the previous year,” explains Eric van der Merwe, CFO at 4Sight Holdings.

“The Operational Technologies (OT) Cluster grew operating profit 53% over the previous year, and the Information Technology (IT) Cluster recovered very well from 2022, growing 49%. The Business Environment (BE) Cluster continued to grow strongly on Data and Modern Digital Enterprise by 12%.”

Van der Merwe adds that maintaining a strong cash balance is a critical component for continuous innovation, research and development and sustainability. 

“This is particularly in the context of the challenging economic environment.”

In this regard, the company increased its cash balances by 33.0%, increasing from R70.3-million as of 31 December 2022 to R93.4-million as at 30 June 2023.

4Sight’s gross profit increased by 21.1% while the increase in expenses was only 17.1%, which contributed to the increase in the net profit margin from 2.7% to 4.7%.

Furthermore, the company continues its drive to extend its reach into more regions and global markets, with strategic partnerships with major global technology companies in place where the company can add value and additional capabilities to its partners’ renowned solutions to open up new markets and industries.

“4Sight’s go-to-market strategy remains on track to achieve the group’s strategic revenue mix objective, which aims to generate 70% in annuity-based revenue and 30% from new sales through a continued focus on creating ‘as a service’ solutions,” concludes Zitzke.