KAL Group (KAL) H1 2026 earnings summary

Executive summary

• Interim results for the six months to 31 March 2026 showed strong operational and financial performance, with revenue up 5.0% to R11.36 billion, EBITDA up 7.7% to R599.7 million, and profit after tax increasing 34.6%.

• Achieved robust growth in fuel volumes and revenue across key segments, demonstrating resilience despite volatile fuel prices and geopolitical events.

• Strategic focus remains on value-accretive growth, capital allocation efficiency, and widening the ROIC over WACC spread.

• Disinvestment from manufacturing (TEGO and Agriplas) completed, with focus now on retail, fuel, and agri segments.

• Maintained strong cash generation and a solid balance sheet through operational efficiencies and prudent capital allocation.

Financial highlights

• Gross profit grew 8.8% year-over-year to R1.81 billion, outpacing revenue growth, with EBITDA up 7.7% to R599.7 million.

• Recurring headline earnings per share increased by 15.1% to 453.25 cents, and recurring headline earnings rose 19.4% year-over-year.

• Interim dividend per share increased by 25% to 70.00 cents.

• Net interest-bearing debt reduced by R453.8 million, with debt-to-equity ratio improving to 32.9% from 48.4%.

• Interest cover strengthened to 6.8x, and net asset value per share increased to R52.3.

Outlook and guidance

• Management expects strong H1 performance to continue in H2, with new business units coming online.

• Anticipates lower demand in H2 2026 due to sustained high oil prices, inflation, and interest rates, impacting consumer spending and agricultural input costs.

• Dividend cover target of 2.5x expected to be reached by year-end.

• Geographic and product diversification expected to mitigate risks from higher input costs and global supply chain disruptions.

• Volatile oil prices and high input costs pose risks, but favorable agricultural conditions and strong balance sheet provide resilience.