Reducing debt and growing net asset value are Brait's main objectives
Brait has already cleared the first hurdle of reducing debt in the UK retailer, New Look, after completing its balance sheet restructuring transaction in May.
New Look’s balance sheet restructuring resulted in its long-term debt significantly dropping from £1.35billion (R24bn) to £350million.
However, in the annual report, Brait chairperson Jabu Moleketi said New Look’s materially deleveraged balance sheet, more flexible capital structure and strengthened liquidity provided a stable operating platform to accelerate investing in the business, with no significant near-term maturities providing a runway for management to focus on long-term growth.
“Considerable progress has been made in delivering on its well-defined turnaround measures, positioning it well to respond to challenges and grasp the opportunities,” Moleketi said. The group’s NAV declined in the past three years following five consecutive years of growth to financial year 2016.
The NAV a share increased from R16.50 a share to R136.27, with the share price trading at a premium but the group said the past three years have seen a disappointing decline to R41.80, with the share price trading at a discount.
“In the coming year the focus remains on materially reducing debt at Brait and driving operating efficiencies in our portfolio businesses, to create value for shareholders and give us headroom to advance our strategy,” Moleketi said.
Brait shares a closed 1.34 percent lower at R19.16 on the JSE yesterday.