TRANSPORT: Golden Arrow Is Flying
Recent Western Cape Business News
GOLDEN Arrow Bus Services may be one of the oldest Cape Town companies still plying its business, but it’s latest results confirm the business has still got some fresh legs.
According to year to end March figures released by Golden Arrow’s parent company HCI, the 150 year old bus company lifted revenue by over R60 million to R963 million.
Gross profits were up almost 30% to R218 million, while bottom line earnings soared by over 50% to R120 million.
HCI executives described Golden Arrow’s performance as “really remarkable, particularly as the business might reasonably be regarded as ‘mature’.”
The latest performance by Golden Arrow more than justifies HCI’s decision (which was initially questioned) to buy out the bus company in 2004. Most observers believed, at that time, HCI should rather concentrate on new economy assets like media and technology.
Considering HCI paid around R270 million for the business, it would seem the bus company’s profits – notwithstanding the substantial investment in new fleets – have more than covered the purchase price.
Of course, it hasn’t always been a smooth ride for HCI. Last month the company reported in its latest annual statements that Golden Arrow had been forced to apply for relief in order to protect the business from competition.
This development, according to HCI, arose from the City of Cape Town purporting to allocate bus operator licences to various others to operate buses.
HCI CEO Johnny Copelyn noted: “We have settled this litigation on the basis of compromise in exchange for written undertaking by the City to honour our contractual exclusivity going forward.”
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