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Johannesburg - Empowerment investment holding company Brimstone Investment Corporation [JSE:BRT] has posted a R400m profit swing from a R77.8m loss the previous year to report an annual profit of R312m for the period to end-December.
The company said an upward revaluation of most of its underlying investments and a substantial increase in dividends received, was mainly responsible for the good performance in a trading period that was impacted by a severe economic downturn.
The R312m profit translates to headline earnings per share of 130.9 cents, in comparison to a loss of 33c/share the previous year.
The asset base increased to R5.6bn from R3.8bn. "The increase in the value of assets under the group's stewardship is largely as a result of the effects of the Sea Harvest and Lion of Africa transactions," said Brimstone.
A controlling interest in Sea Harvest was purchased by a Brimstone-led consortium from former partner Tiger Brands, which transformed the fishing company to Brimstone's second largest investment by value.
"Brimstone continues to pursue opportunities that have the potential to unlock value and secure future earnings growth for the company and its shareholders," it said. Based on that strategy, Brimstone acquired a further 35% shareholding in Lion of Africa Holdings, increasing its interest from 39% to 74%. It also purchased 1% of food producer Tiger Brands in a black economic empowerment transaction.
Those efforts helped to lift Brimstone's net asset value/share to 1 030c, or intrinsic net asset value of 1 137c/share.
It was not all smooth sailing, however. Brimstone said its interests in fashion group House of Monatic were negatively impacted by a recorded loss of R30.2m, which included further write-offs resulting from the liquidation of the Fifth Element group. It also incurred costs with the closure of its Atlantis apparel manufacturing facility.
- Fin24.com
