Diversified investment and empowerment firm Sekunjalo Investments yesterday posted results that showed full-year headline earnings more than doubled as the group benefited from strong underlying performance across its segments. The company also declared a maiden dividend.
Headline earnings jumped to R78.6 million in the 12 months to August from R29.8m a year earlier. Revenue rose to R621m from R569m in the previous period. Headline earnings a share leapt to 16.03 cents from 6.10c.
Sekunjalo Investments, which is the listed subsidiary of Sekunjalo Investment Holdings, declared a maiden dividend of 2c a share.
“We followed a focused strategy of organic growth, debt reduction and continuous reinvestment in our business with the objective of building a solid and sustainable high growth company for the future,” executive chairman Dr Iqbal Survé said in a statement.
“Our results are testimony that our strategy has worked. Our core operational investments in information communication technology, fishing, health and the media sectors have shown excellent growth,” he added.
For the period under review, operating profit increased 47 percent to R99m, while profit before tax surged 84 percent to R108m. The company said the annual results included a once-off financial gain of R22.5m (R18.3m net of tax) due to a change in control over its biotech investment.
As of June, Sekunjalo Investments gained control of Genius Biotherapeutics, which was accounted for as a subsidiary. Previously it had been accounted for as an associate.
The company said its net asset value (NAV), a measure of an investment company’s assets minus the value of its liabilities, increased about 20 percent to R569m from R472m, a development that the company said showed “consistent growth and strength of the group’s financial position”. The NAV per share jumped to 115.81c from 96.50c.
The marine segment – which includes Premier Fishing, the largest black-owned and controlled fishing company in South Africa – posted a 112 percent jump in operating profit to R51m from R24m.
“This good performance was achieved due to operational efficiencies,” the company said. “The marine division experienced exceptional catch rates through effective planning, and vessel scheduling and utilisation.”
Strong performance was also evident in the company’s enterprise development, with espAfrika returning to profitability. It posted a R7.7m operating profit in the 2014 financial year versus a R7m operating loss in 2013.
The company also notified shareholders that due to strategic reasons, the board of directors had proposed that its name be changed to African Equity Empowerment Investments, subject to shareholder approval. The name change would better reflect the underlying business and differentiate it from its private holding company.
Khalid Abdulla, the chief executive, said he was confident shareholders would acknowledge and appreciate the effort Sekunjalo had put into growing the business.
Shares closed unchanged at R1.38. Year-to-date the stock is up 160.38 percent.
KEY MILESTONES
1997
Sekunjalo Investments is formed. For seven months, founders tried to raise money from former struggle activists, many of whom were unemployed. R250 000 is raised.
1997-1999
First investment, partnering with the Afrikaner business community.
May 1999
Sekunjalo lists on the JSE.
2005
Sekunjalo focuses in developing solutions for the poor through innovation and technology.
2006
Sekunjalo raised investments in biotechnology, media through a 51 percent stake in espAfrika, and motor holdings. Ranked top empowerment company by Financial Mail/Empowerdex.
2007 onwards
Empowerment partner of choice for strategic investments. Attains broad-based black economic empowerment – Level 1 status.
2010
Sekunjalo ranked as South Africa’s most empowered firm.
2014
Receives top award – 2014 highest sustainability data transparency index score – best company in the financial services sector – ranked 16th out of the Top 500 JSE-listed companies – ranked 182 in the previous year by Integrated Reporting and Assurance Services. (Source: BR research / company reports)
* Sekunjalo owns Independent Media, of which IOL is a division.