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RAC on good footing with greater banking flexibility and Goldrush

Asset manager Piet Viljoe

Asset manager Piet Viljoe

Published Jul 28, 2022

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Asset manager RECM & Calibre (RAC), spearheaded by asset managers Piet Viljoen and Jan van Niekerk, and with a focus on gaming, yesterday said it now had banking flexibility to buy back shares or pay dividends, while its gaming subsidiary, Goldrush, was doing good trade.

The firm shared an update into its operations, comment made at its annual general meeting meeting on Tuesday.

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Yesterday, the share price was 1.12 percent higher in midday trade at R13.50, having gained 40.53 percent in a year, after the share being down 17.59 percent in three years.

Effective July 15, RAC said it had distributed the remaining Astoria shares it still owned to its shareholders.

This represented the equivalent distribution of 55c per RAC share when measured at Astoria’s current share price, or the equivalent of R1.13 per RAC share if measured at Astoria’s net asset value.

The distribution of Astoria concluded the final step in the removal of the cross-holding between the two companies, it said.

RAC’s banking arrangements had been renegotiated to reduce the cost of funding and provide it with more flexibility.

“This means we can repay debt without penalty, buy back shares or pay dividends. We have already started to make use of this enhanced level of flexibility,” it said.

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It said its subsidiary, Goldrush, had continued to trade well during the first four months of the new financial year. This has led to the rolling 12-month earnings before interest, taxes, depreciation, and amortisation (Ebitda) at the end of July being expected to exceed R380 million.

Subsequent to year-end, Goldrush refinanced a liability to a machine supplier and consolidated this debt with its current bankers. In the process it received discounts of R35m.

Bingo operations had benefited from the lifting of the final mask mandates in late May, it said, adding that the company was on track to deploy additional Limited Pay-out machines in line with its strategy for the year.

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Retail sports betting continued with strong in-store growth, while the online division had seen further improvement in sales.

Last month, RAC reported for the year ended March 31 its net asset value per share decreased by 32 percent to R14.48 from R21.33 for the comparative period.

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