Tyme, which owns TymeBank, is on the verge of securing a new capital raise from new and existing shareholders, its parent company, African Rainbow Capital, said yesterday as it highlighted resilience across its investment portfolios in spite of a tough economic environment in South Africa.
TymeBank, which also has operations in the Philippines, has an annual revenue run rate of R1.8 billion and has been raising its clientele base by 450 000 users per month. The GoTyme operation has annual revenues of R100 million.
“The Tyme group is currently in the process of closing the Series C Capital raise with a combination of existing and new shareholders,” African Rainbow Capital said yesterday in a trading update for the quarter period to the end of September.
TymeBank has now raised its user numbers to 8 million customers since launch in February 2019, feeding into an average of 23 million monthly transactions with a monthly account activity rate of 70%. The company is now targeting “profitability” in the next few months.
Tyme launched GoTyme in the Philippines in October last year under a partnership with the Gokongwei Group. It is “currently onboarding about 250 000 customers per month and has a total clientele base of 1.6 million customers.
“The bank is exceeding most of its metrics, with deposit growth significantly ahead of forecasts. It will launch the SME merchant cash advance product in the Philippines in the coming weeks.”
The rise in user numbers for TymeBank has come against a tough operating environment in South Africa. African Rainbow Capital flagged “elevated interest rates, disruptions to electricity supply, high unemployment and pressure on disposable” incomes.
However, the investment company said its other portfolio companies had “demonstrated resilience”, adding that it remained committed “to identifying promising investment opportunities” further. Shares in African Rainbow Capital rose 2.26% on the JSE yesterday to R4.98, but is down 21.5% in the year-to-date comparative.
rainOne, African Rainbow Capital’s mobile and fixed wireless holding, also saw an increase in usage of its unlimited data, free monthly calls and 5G connectivity during the three-month period to end of September. It attributed this to the conversion of existing customers from legacy products as well as the acquisition of new clients.
Kropz Elandsfontein, nonetheless, faced a “challenging period” between June 30, 2023 and September 30, 2023.
It was impacted by localised flooding, heavy rains and breakages which affected its mining and processing operations at Elandsfontein. This led to increased production downtime although the company managed to produce and sell 63 900 tons of phosphate concentrate between June 30, 2023 and September 30, 2023.
Kropz is now aiming to step up its production levels by installing an additional centrifuge in February 2024, capitalising on African Rainbow Capital’s continued support for the company as well as the ongoing operational ramp-up at Kropz Elandsfontein. A fresh capital injection of R290m had been invested into the operation during the quarter period under review.
With the Upstream Group experiencing growth in its existing clients and managing to acquire new clients, it managed to control costs closely. It experienced a higher value and a higher number of accounts entering debt review.
“The reason for this is twofold: creditors are extending additional credit to the same pool of consumers, and consumers are entering the debt review process a lot sooner than in previous years.”
Earlier this year, Sanlam announced the conclusion of an agreement to acquire 26% of the Capital Legacy unit in exchange for Sanlam Trust business and cash. African Rainbow Capital said this transaction had “closed” during the period under review.
Management was now focusing on “integrating the Sanlam Trust business and launching enhanced Wills and Estate product offerings” into the Sanlam Group.