Atlas Mara seeks to expand Africa growth

Atlas Mara seeks to expand Africa growth

2015-03-26 08:43

Harare - John Vitalo, financial services group Atlas Mara’s chief executive officer, said the Africa-focused group is eyeing even more acquisition opportunities in the region as it seeks to improve its footing on the continent through organic growth.

The Robert Diamond-fronted financial services group on Wednesday said it incurred a $63.1m loss during the 13-month period to the end of December. However, it posted a $7.2m net profit, excluding non-recurring transaction and intergration expenses for its operations which now encompass the former African Banking Corporation.

The group said the long-term outlook for the Africa region – which it views as lucrative for new investors in the banking industry – remains positive, with gross domestic product (GDP) growth rates in the countries where it operates “expected to markedly exceed developed markets economic growth forecasts”.

After buying into the ABC group in 2013, Atlas Mara now has a presence in markets such as Zimbabwe and Botswana among others. It now owns the BancABC units previously controlled by ABC.
During the period, Atlas Mara raised $625m in equity capital through an initial public offering (IPO) and a subsequent private placement. It made acquisitions in three African groups - ADC, ABC, BRD - and bagged another 30.2% in Union Bank of Nigeria, boosting its presence on the continent.

"We are excited about realising the growth opportunities existing in the sub-Saharan African markets in which we are operating and/or investing in and are focused on delivering improved financial performance across the group. We expect to demonstrate marked improvements in organic growth and profitability and will continue to pursue acquisition-related growth where consistent with our strategic objectives," said Vitalo.
Atlas Mara said the group’s financial performance had been “negatively impacted” by various transaction costs including its IPO, private placement, acquisitions, impairments and margin compression due to liquidity constraints in selected markets at BancABC.

In December, Atlas Mara injected $27m into BancABC and an additional $73m towards the end of the reporting period. However, as a result of the $63.1m statutory loss, the group did not declare a dividend for the period to end-December.

“In 2015, Atlas Mara will continue to execute its plans for safeguarding, integrating and growing its operating businesses and investments while also continuing to evaluate acquisition opportunities in its existing, as well as other, attractive sub-Saharan African markets.
“In connection with our acquisition-orientated strategy, we may seek external financing during the course of 2015, remaining, at all times, cognisant of our cost of capital and desire to deliver strong returns to shareholders,” Atlas Mara said in its financial results statement.