Sabvest fares better than expected

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Sabvest fares better than expected

Published Date: 2020-09-10 | Source: Stephen Gunnion | Author: Stephen Gunnion

Sabvest fares better than expected

The investment company expects a recovery in most of its underlying investment companies next year if there are no further lockdowns.

Sabvest Capital says its first half performance turned out better than it it expected at the onset of Covid-19, with its net asset value per share decreasingly only marginally over the six months to end-June. The investment holding company says it was aided by the expected recovery of most of its investees by year-end and the materially weaker currency, which enhanced the rand value of its offshore investments.

The company, which owns stakes in five listed companies including Metrofile, Transaction Capital and London-listed Corero Network Security, as well as a number of unlisted companies and an offshore cash portfolio, reported a 0.4% decline in its net asset value to R66.24 per share at the end of June from R66.48 in December. It sold its equity investment in Brait for R49.1 million in January but still holds some of the investment group's sterling convertible bonds. Its investment in fintech group Net1 is also up for sale.

It swung to a loss of R161 million from a R52.5 million profit a year earlier. Its loss and headline loss per share amounted to 387.5c, down from earnings of 126c previously. After accounting for translation gains, comprehensive income declined by 64% to R13.8 million.

Sabvest said its balance sheet remained strong with shareholders' funds of R2.75 billion and interest bearing debt net of cash of R274 million. With most of its investee companies retaining cash for their own liquidity and not paying interest or dividends, it turned cash flow negative for the period but expected to return to being cash flow positive by the end of the year. It deferred a decision on an interim dividend until its December board meeting.

Sabvest's shares rose 25% to R33.44 yesterday.





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