4Sight’s AI vision gives earnings clarity

Technology group 4Sight Holdings has placed AI at the heart of its business model — and the numbers show the strategy is paying off. For the six months to end-August, revenue rose 6.8% to R578.7m, operating profit surged 35.7% to R48.3m, and earnings climbed more than 30% to 6.75c a share. In a world where most companies are still trying to turn the promise of AI into tangible results, 4Sight appears to be already reaping the early rewards.

At the heart of this transformation is what CEO Tertius Zitzke calls 4Sight Automated Intelligence, or simply 4AI — a business-centric approach to artificial intelligence designed around measurable returns. Zitzke says the group’s growth is driven by “the five pillars of digital transformation: people, growth, operations, finance and innovation”. In his words, “business now understands where this is going — it’s all to do with automation of routine processes”. He explains that the pandemic shifted automation from industrial machines to people-based workflows, as remote work created huge data trails. “That’s why the explosion in data centres is happening worldwide,” he says. “Everybody is adding, adding, adding. You can imagine the nightmare of auditors trying to get documents. That’s where automation now happens.”

This human-centred automation forms the foundation of 4Sight’s AI-driven growth. The business environment cluster, which houses much of the group’s AI and data work, delivered a 264% increase in profitability in the half-year — a figure that captures how central AI has become to its business. The IT cluster is layering AI “copilots” into ERP (core software platforms) and financial systems to automate previously manual processes such as reconciliations, reporting and payroll. Zitzke gives a vivid example: “One of my friends asked a new financial manager how often she does bank reconciliations. If she says once a week, don’t hire her — you must do it every morning. That’s a routine thing that financial copilots do for you now.” These copilots can automatically download statements, match invoices to purchase orders and even communicate with vendors to resolve exceptions. “Systems do all of that now,” he says. “We used to talk about three-way matching in procurement; we’re now on six-way matching, starting from requisition.”

Business now understands where this is going — it’s all to do with automation of routine processes

—  Tertius Zitzke

The industrial side of the business is also evolving rapidly. 4Sight’s operational technologies cluster, historically exposed to cyclical mining clients, has pivoted to oil and gas and is now embedding AI in its automation and simulation platforms. This is where the company’s vision of the artificial intelligence of things (AIoT) takes shape. AIoT fuses AI with the internet of things, creating networks of sensors and devices that can “sense, analyse and act autonomously”. The result is predictive maintenance, smarter energy management and self-optimising production environments. It’s the culmination of 4Sight’s long-term strategy to merge operational technology (OT) and IT into what it calls intelligent convergence — turning hindsight into foresight.

That convergence is increasingly the company’s competitive edge. “I’ve got 10 engineers, and I’m battling to get them off Excel,” Zitzke jokes, underscoring how traditional industrial systems are still fragmented. “The war between OT and IT is still going on, but the convergence — that’s why 4Sight was formed. The only way we do it is with data.” For him, the goal is clear: “No more separate Excel; let’s just get it together now.” This philosophy underpins the group’s deep partnerships with global technology players such as Microsoft and Siemens, both critical enablers of its AI-led platforms.

The group’s channel partner cluster, which accounts for about 38% of total turnover, also delivered a strong performance, with profitability up 14%. The division distributes Microsoft, Sage and other AI-enabled software solutions across Africa and Europe, reinforcing 4Sight’s role as a key conduit for global technology adoption. The shared services cluster showcased the same automation advantages 4Sight delivers to its clients, achieving notable cost savings through the automation of back-office functions.

What makes 4Sight compelling for investors isn’t just the growth, but the valuation. At a market price implying an earnings multiple of below six, the stock trades at a steep discount to its global digital transformation peers, even as it delivers double-digit earnings growth. The group’s net cash position — about 20% of its market capitalisation — provides further comfort. This cash gives management room to pursue acquisitions, which Zitzke confirms are on the radar. “We’re exploring acquisitions that will complement our business units and scale up revenues, especially companies with intellectual property driven by AI-focused solutions,” he says. In other words, 4Sight’s next leg of growth may well come from inorganic expansion.

Asked whether 4Sight might consider a tie-up with iOCO (the rebranded remnant of the former EOH Holdings), Zitzke is diplomatic but clear-eyed. “We’re friendly, we talk, but there are complications.” iOCO still lacks Microsoft licences due to its controversial past, a gap that would make meaningful integration difficult. Instead, Zitzke says 4Sight’s acquisition focus is on mid-sized companies with turnover of about R100m, where the operational fit is easier to align.

With agentic AI — applications that can act autonomously within business-defined boundaries — emerging as the next major frontier (64% of technology executives are expected to deploy such systems within the next two years, according to 4Sight’s results presentation), the future looks as promising as Zitzke’s own infectious enthusiasm for AI suggests. And with the company trading at a valuation multiple well below that of its international peers, the investment opportunity appears equally compelling.