Three investments had a major impact on Sabvest’s performance

JSE-LISTED investment group Sabvest’s results for the six months to June was negatively impacted by the share price performances of its listed investments Brait, Metrofile and Torre Industries.

The group said on Friday that Brait’s share price declined after the Brexit vote, particularly as a result of New Look’s poor showing.

In the past 12 months Brait’s share price has been in a freefall, declining to R43.27 a share, down from R63.36 at the end of July last year. During the period Sabvest increased its shareholding in Brait by purchasing 3.2 million shares for R128.5 million, increasing its direct holding to 4 million shares.

“Metrofile produced stable earnings and concluded the acquisition of G4S Kenya. Its share price has, nevertheless, been weak for most of the period,” the group said.

It said Torre’s share price has been weak, due to poor operating performances in the division affected by weakness in the mining and industrial sectors.

Despite the poor results from these three listed investments, Sabvest managed to increase its net asset value a share by 46.4 percent to 5 458 cents a share during the period, up from 3 728c as compared to last year. This was achieved because of improved valuations of its investment in Mandarin and Sunspray, satisfactory trading and strong share price performances in the offshore portfolios and locally in Transaction Capital and the Value Capital Partners Fund.

The group holds a 30 percent stake in Mandarin and a 28.2 percent stake in Sunspray, both locally unlisted companies. As a result the group reported improved earnings during the period, with profit after tax increasing by 194.2 percent to R159.81m, up from R54.33m as compared to last year.

Headline earnings a share and earnings a share increased by 195 percent to 352.9c and 353.3c respectively.

The group declared a dividend of 32c a share, up by 23 percent compared to last year’s 26c. It said shareholders’ funds increased to R2.47 billion during the period.

Going forward, Sabvest said it remained focused on considering new unlisted investments or listed investments where it was represented on the board and has influence.

It added that it would use its surplus cash and realise its general and technology equity portfolios to fund new investments if it becomes appropriate or use its debt capacity. It might also issue new shares, but only if the value exchange in the capital allocation decision was compelling.

Sabvest shares closed 1.47 percent up at R34.50 on the JSE on Friday.