BHC profit declines
Botswana Housing Corporation ( BHC) profit declined by 81 percent during the six months period ended September 2022 due to increased operational expenses and financing costs.
During the half year period the corporation recorded profit after tax of P3.5 million compared to P18 million recorded in the same period last year. Commenting on the published results, BHC Acting CEO, Nkaelang Matenge said the Corporation did not start any project during the period and this has affected the rate of capitalization to projects of both interest expenses and staff costs resulting in an increase in interest expenses year on year by 24 percent to P18 million.
“Operating costs also increased year on year on the back of increased repairs and maintenance. However, there are three major projects which are scheduled to start in the second half of the financial year, and this is expected to mitigate against this negative performance.”
The Corporation recorded revenues of P251 million for the six months, a decline of 24 percent from the P332 million recorded last year. “The decrease in revenue was mainly because of reduction in sales revenue which decreased by P69 million representing 93 percent decrease year on year.” Facilities management income also declined by 25 percent year on year due to low activity on construction projects as the Corporation’s key stakeholders’ decided to defer some of the planned thirdparty projects.
Sales revenue, which is the Corporation’s major revenue stream, did not perform well during the first half of the financial year decreasing year on year by 93 percent to P5 million from P74 million. The Corporation pointed out that this negative performance was driven by low sales volumes compared to the prior year. “During the period under review, old stock, which has relatively higher margins, dominated the sales mix at 30 units compared to new stock which sold 11 units.”
The rental income, which is the second major revenue stream for the Corporation increased by P18 million to P139 million due to rental adjustment which was effected from April 2022 and some additional housing units added to the investment properties portfolio.
BHC plans to start 531 housing units in Gaborone Block 7 ( 196 units), Kazungula ( 212 units), Maun ( 100 units), Phakalane ( 13 units) and Tsabong ( 10 units) before end of the financial year.