Ecsponent said yesterday its earnings per share (EPS) were expected to decrease by between 95 and 75percent, resulting in EPS of between 0.15cents and 0.78c, as compared to the EPS of 3.121c for the same time in 2017.
The group said headline earnings per share would also fall between 90 and 70 percent, or between 0.17c and 0.51c, as compared to 1.698c for the same period in the previous year.
Ecsponent chief executive Terrence Gregory said the market was worried about the UK’s ongoing Brexit talks, rising interest rates globally, US President Donald Trump’s unpredictable actions, and political and economic crises in South Africa.
Gregory said global and domestic issues had brought uncertainty to the market, making investors nervous about investing money, or shock-proof their investment portfolios through safe and predictable asset classes.
“The biggest risk for the investor centres on regulation and regulatory changes, the rhetoric on policy changes such as expropriation of land without compensation also makes industries nervous. Our job is to find opportunities, and invest and disinvest in them at the right price,” said Gregory.
Essponent’s footprint runs across South Africa, Botswana, Swaziland and Zambia.
The group predominantly creates wealth by investing in companies that offer a range of niche financial services.
These services vary in different jurisdictions of operation. The core business units include Investment Services, Business Credit, and Equity Holdings.
In February, Ecsponent raised a R700million loan from the African Export-Import Bank (Afreximbank) to help reduce funding costs and boost profits.
The four-year loan facility, which would diversify its funding and support its lending business aimed at small and medium-sized enterprises in Southern Africa, had been preceded. Prior to the loan facility, Ecsponent had to raise cash through preference share and domestic medium-term note programmes, as well as institutional funding.
The group has raised about R1.6billion by issuing preference shares in SA since 2014.
Ecsponent’s shares closed unchanged on the JSE yesterday at R0.24.