BUILDMAX, a supplier to the mining and construction industries, has set itself the ambitious targets of raising turnover 15-fold in the present financial year. As if to underline this, its share climbed more than 6% yesterday.

The R111,5m revenue the group made in the year to February is minuscule compared with the R1,7bn it expects to make this year.

However, the recent results do not take into account two major acquisitions the group made between December and March, which are expected to enhance an enlarged Buildmax’s earnings.

The group spent about R1,5bn to acquire equipment and services supplier Buildco and Diesel Power Open Cast Mining, strengthening its position in the both the mining (especially coal mining) and the construction sectors.

These are both high-growth sectors, given the increased demand for coal by Eskom, as well as billions of rands being spent by both the government and private sector on infrastructure projects.

The group has also projected an after tax profit of just above R200m, making it a competitor in its sector.

CEO Paul de Klerk said the group’s equipment and services division would do even better than expected because it was already dealing with huge demand.

The prospects look rosy.

DIVERSIFIED supplier of equipment and open cast mining services and construction materials Buildmax revised its listing on the JSE main board, yesterday floating 179 million new shares to raise about R310m in capital.

CEO Paul de Klerk said the group would use the funds to reduce debt and finance growth.

Buildmax’s share price opened at R2,25, a 25% premium to the R1,80 per share in the pre-listing private placement, giving it a market capitalisation of R2bn on listing of the new shares from a mere R100m previously.

Foreign investors took about 40% of the private placement. The group raised a further R61m by the issuing of 40- million new shares to a black economic empowerment consortium led by Vuwa Investments, an existing shareholder in its subsidiary Buildco.

The capital raised would be used partly to fund the acquisition of Diesel Power. Through this acquisition, as well as that of Buildco, Buildmax has repositioned itself as a supplier of equipment, mining services and construction material.

This is expected to drive growth with revenue forecast to grow to R1,7bn, profit from operations to R373m and profit after tax to R201m.