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Finance group Ecsponent reports exponential growth

Jun 29 2017 18:42
Lameez Omarjee
iStock_data, results


Company Data

ECSPONENT LIMITED [JSE:ECS]

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Last Updated: 01/01/0001 at 12:00. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg – African financial services group Ecsponent [JSE: ECS] reported a profit growth of over 200% in the past 15 months.

This is according to the group’s financial results, for the 15 months ended March 31, which was released on Thursday. Among Ecsponent’s focus areas include enterprise development, funding for small to medium enterprises and private equity investment.

During the period, the group grew its investments in financial services, and disposed non-core assets which were not performing, according to the SENS.

Ecsponent’s bottom line was over R67.6m. This is up 239% from R19.9m reported in 2015. Operating profit was up from R44.4m in 2015 to R229.9m, while total revenue was at R321.8m, up from R144.7m.

Earnings increased from R23.4m in 2015 to R78m. Earnings per share were at 8.38c, up from 2.59c reported in 2015. No dividend was declared.

Reviewed strategy

Among the non-core assets which have been disposed during the period, Ecsponent is currently disposing of its 50% stake in Botswana's Sure Choice, to fintech company GetBucks for a purchase consideration of R12.7m. This is subject to regulatory approval.

The group is also diluting its interest in Ecsponent Financial Services (EFS) Zambia from 100% to 25% is also subject for approval. “Both the Sure Choice as well as the EFS Zambia transaction are anticipated to be finally concluded in the near future,” said the group.

The group has three core functions, these being investment services which includes capital raising, business credit and equity holdings.

Investments had grown from R313.8m in 2015 to R928m. Total returns of R127.3m were paid, the SENS reported.

Credit operations also grew over the period, with interest income up 271% to R232.3m. The new enterprise development sector generated R31m of the income. Procurement serves contributed R30.6m to the overall results.

During the period Ecsponent invested in MyBucks SA, which is listed on the Frankfurt stock exchange. “The MyBucks investment is the most significant equity investment for the Ecsponent group to date, with the group’s shareholding value at the period end of R233m,” the SENS stated.

The group’s biotechnology operations managed to increase sales revenue by 28.7% to R32.2m. media and intelligence business, Return on Innovation contributed R10.3m to group revenue. 

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