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Alexander Forbes upbeat despite volatile market

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Diversified financial services group Alexander Forbes had a tough trading environment in the six months to September characterised by volatile equity markets and headwinds in the South African economy.

The increase in unemployment and retrenchments in its client base and the resulting withdrawals in savings that impacted results also hit the group. The share price slid by as much as 16 percent to R6.35 on the market’s uncertainty about continued profitability, given the uncertain labour and economic environment.

Alexander Forbes, which declared a dividend of 15c a share, said it saw an increase in operating income from continuing operations which was up 9 percent to R2.6bn, while profit from continuing operations before non-trading and capital items increased by 2 percent to R552 million.

Headline earnings a share increased 126 percent to 26c a share due to listing and transaction costs in the prior year. The group also gained from continued rand weakness, which declined 9 percent in the average rand/sterling rate, increasing rand profit 29 percent from operations of R126m for the period under review.

AfriNet, the company’s subsidiary that covers all operations in Africa outside of South Africa, increased operating income by 17 percent to R161m for the six months and profit from operations rose 24 percent to R31m.

The group said this result was driven by strong organic growth across both the retail and institutional businesses with retail the stronger performer, increasing its operating income net of direct expenses contribution to 19 percent, from 13 percent in the same period a year ago on the back of a very successful and growing distribution base in Kenya, Botswana and Namibia.

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BSE upgrades online investor access

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A recent BSE opening bell function.

Botswana Stock Exchange Limited (BSEL) will this year introduce a new clearing and settlement system, as part of efforts to improve operations of the bourse.

Speaking at the seventh opening bell ceremony, Chief Executive Officer, Thapelo Tsheole said the development will help improve liquidity and risk management. In addition, the new settlement system replaces the 2008 system while fast tracking introduction of security borrowing and lending, management settlement guarantee fund, as well as identifiers for companies and instrument.

BSEL has already awarded a contract to a Swedish company to implement the system which is also expected to digitalize Initial Public Offering (IPO), allow electronic voting for listed companies during annual general meetings (AGM) for absent shareholders.

The project, which is expected to take eight months once the two parties sign the deal, is part of efforts to have more online investors access for BSEL. Tsheole also revealed that BSEL website will undergo a revamp this year, allowing it to be more analytic, live feed shares, as they trade.“The tender is already out for the website and mobile application. It is a project that we had hoped to implement last year but because of logistic problems, we could not do it,” said Tsheole.

BSEL further plans to introduce two data display screens at CBD and at the stock exchange.“These will assist with information sharing and keep the market updated,” said Tsheole. Meanwhile, BSEL will not change its Automated Trading System (ATS) until 2022, according to Tsheole.“The system supports our strategy to grow the market and increase the average daily turnover levels to 18.0million per day by 2021,” said Tsheole.

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BSE complies with reporting guidelines

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Botswana Stock Exchange Limited (BSEL) has become the 5th bourse in Africa to comply and publish Environment, Social and Governance (ESG) reporting guidelines.

The development comes a year after BSEL became a partner exchange of the United Nations Sustainable Stock Exchange (SSE) Initiative.“The BSE made a commitment to publish guidance on ESG Reporting. This commitment has been fulfilled.“

We are the 42nd among the 81 SSE Partner Exchanges globally and the 5th in Africa to do this,” said Kgotla Segwe, Market Development Specialist at Botswana Stock Exchange Limited.
Other stock exchanges that have complied with the SSE initiative on the continent are from South Africa, Nigeria, Morocco and Egypt.

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