THERE's not terribly much one can say - as a financial journalist - about the performance of financial services group PSG's results for the year to end-February 2009.
Tangible net asset value is markedly down in line with the crunch in equity markets, while growth in "recurring" headline earnings (thanks mainly to Capitec Bank and PSG Konsult) was sound.
But what struck me most about PSG's results is that there is still an energy, a buzz if you will, in the business. While other investment companies may be treading cautiously around engaging in opportunities (hell, I even heard that Remgro's Johann Rupert had told his senior managers to turn their phones off), PSG seems to be excited by the market shaking out well-priced opportunities.
What caught my eye at once was that PSG has undergone a major executive shake-up - most notably the retirement of PSG co-founder Chris Otto.
Otto, who will remain on board as a non-executive, always seemed more comfortable out of the limelight.
But such reticence should not detract from the important role he played at PSG over the last 14 years, especially as a foil to co-founder and adventurer CEO Jannie Mouton. An insider told me on Monday night: "Chris was a huge sounding-board for Jannie's strategy and vision."
Piet Mouton, the son of Jannie Mouton, now joins PSG as an executive director after five years with the group in various designations.
The other important executive change is that Pierre Malan has resigned as director of PSG Group and CEO of Paladin Capital.
Paladin Capital, in effect, is PSG's 86.9%-owned investment arm. The company, which has been mooted for a separate listing, holds an array of listed and unlisted investments.
I understand that Malan, who I remember took a sabbatical in 2008, differed with Mouton (and perhaps other board members) on the way forward for Paladin.
Francois Swart replaces Malan as Paladin CEO, with Bernardt van der Linde (an old Finweek colleague, whose financial acumen was wasted on business journalism) also appointed to Paladin's executive.
It does seem that PSG executives will spend most of their time shaping up Paladin, and this probably meant instituting new leadership rather than allowing executive tensions to linger at the investment company.
'Jannie wants action'
If Paladin needs work, some effort is certainly needed in focusing the group's sprawling - but hardly boring - investment portfolio, which spans everything from financial services and logistics to construction and engineering.
Fortunately, PSG can afford to spend time on Paladin as their other investment pillars (Capitec, Zeder, PSG Konsult and fund management) seem to be ticking along just fine.
Thankfully, Paladin seems intent on taking advantage of well-priced - or even miss-priced - opportunities brought about by the shake-out in mainly retail investment sentiment.
In this regard, I note Paladin has bumped up its interest in scaffold specialist Top-Fix Holdings from around 11% to 18.2%. I understand it has subsequently been pushed through the 20% mark.
With Paladin already holding a number of construction-aligned investments - Pre-Crete Nozala and Erbacon Investments - I wonder whether marked-down listed companies in the broader infrastructure sector will be targeted in the months ahead.
PSG's significant minority stake in junior mining group Petmin has also been transferred to Paladin. Perhaps more junior mining investments, possibly utilising the empowerment credentials of associate Thembeka Capital, are on the cards too?
A PSG insider tells me it will be an active year for the firm. "It's all about doing deals. Jannie (Mouton) wants action."
If PSG, or rather Paladin, gets its timing right in snapping up stakes in well-managed and cash-generative companies, shareholders might be sitting pretty in years to come.
In comments accompanying the results to end-February, PSG declared that three-quarters of free cash flow earned from underlying investments - after payment of the PSG Financial Services perpetual preference dividend and other financing commitments - would be paid out as an ordinary dividend.
Paladin's positions could well underpin future payouts - especially if one or two of the early-stage investments mature half as well as Capitec Bank or PSG Konsult.
- Fin24.com