Sasfin flags higher earnings


Sasfin flags higher earnings

Published Date: 2019-09-05 | Source: Stephen Gunnion | Author: Stephen Gunnion

Sasfin flags higher earnings

The financial services group has benefited from lower impairments after improving its credit processes.

Sasfin's shares rose yesterday after the financial services group primed shareholders to expect a strong rise in full-year earnings.

In a trading statement, it said earnings per share (EPS) for the year to end-June would be between 25% and 30% higher than the 359c it reported last year. Headline EPS would come in 28% to 33% above the 381c reported in the comparative period. HEPS is the main profit gauge of JSE-listed companies and excludes certain once-off items. It gave no reasons for the improvement.

In March, Sasfin reported a big recovery in interim earnings due to lower impairments and a smaller tax bill. The group said it had taken steps to improve its credit processes after it noticed a deterioration in its credit book over the previous two years. Its 2018 results were affected by a significant credit event. At the halfway stage, its credit loss ratio had declined by 77 basis points to 123 basis points and it reported a healthy cash position of R1.11 billion rand. Its half-year tax expense amounted to R30.3 million, down from R47.5 million a year earlier. It also benefited from the acquisition of the rental finance book of Absa Technology Finance Solutions in April last year, which boosted overall loans and advances.

Its results are scheduled for release on 17 September. Its shares gained 3.6% to R29 yesterday.

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