Blue to suffer loss

Johannesburg - South African micro financier Blue Financial Services Ltd will swing to a first-half loss after being hit by a loss of R162.3m and as tighter funding and high operating costs hurt business.

Blue, which reports its results for the six months to end-August on November 30, said on Thursday it expects to report a basic loss per share of 27.07 cents and a headline loss of 27.11 cents per share.

The micro lender said it had also been hit by a 119 percent rise in expenses after increasing its branches to 260 from 192, as well as having to increase provisioning against non-performing loans by 155 percent to 147 million rand.

The company, which has been aggressively expanding its footprint on the African continent, said most of its operations on the continent had been hurt by a stronger rand currency and said a lack of funding due to the economic downturn had also affected business.

Blue said it expected to return to profitability in the medium term and was changing its strategy, including delaying expansion plans for the short term, to help stabilise business.

- I-Net Bridge