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Rupert to pay Reinet shareholders 2.5% more in dividends

May 25 2016 12:45
Matthew le Cordeur

Cape Town – Reinet Investments chairperson Johann Rupert on Wednesday announced that the company wants to pay €0.161 (R2.82) per share to shareholders, increasing its dividend by 2.5%.

Delivering his financial report for the year ended March 31, Rupert said the group would act with prudence to maintain a pattern of long-term growth for shareholders.

Reinet’s shares on the JSE were trading 0.19% higher at R34.44 at midday on Wednesday. The company has a market cap of R67.48bn.

“The global economic situation has not improved significantly over the last twelve months. Cash and government bonds attract negative interest rates in Europe and the economic situation in the United States and in China is unsettled.

"In addition, the geopolitical situation has, if anything, worsened. This calls for prudence," he said.

Rupert said Reinet's goal remains that of looking to maintain a pattern of long-term growth in shareholders' capital.

"We will continue to seek investment opportunities where funds can be deployed with a high degree of security and where we believe Reinet can add value,” he said.

Rupert said the company’s net asset value increased by 3% to €5.221bn in the year ended March 31.

The growth in net asset value reflects a compound return of 16% per annum, in euro terms, since March 2009, including dividends paid.

Rupert said Reinet was continuing its policy of diversifying out of the British American Tobacco position as and when funds are required to invest in other opportunities.

As such, he said 6.25 million shares were sold during the year under review.

“As a result, Reinet’s interest in British American Tobacco represented some 67.3% of the net asset value at 31 March 2016, compared to 70.5% a year ago.

“Nevertheless, the value of the remaining holding of 68.1 million shares in British American Tobacco increased in value to €3.512bn at 31 March 2016. We remain confident in the future prospects for this global business.

“At 31 March, the proceeds of these sales were held to fund a further investment in Pension Corporation, which is expected to close in June this year.”

Subsequent to the year-end, Reinet committed to invest up to an additional €177m in Pension Insurance Corporation Group.

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