| African Rainbow Capital Investments Limited: Annual financial results for the year ended 30 June 2024 |
| HIGHLIGHTS: |
| Financial performance: |
| Intrinsic net asset value (INAV) increased by 21.5% to R18 616 million (30 June 2023: R15 328 million), comprised essentially an increase in equity through a rights issue of R750 million and a net gain of R2 671 million. INAV per share increased by 8.5% to R12.38 (30 June 2023: R11.41) in a sluggish economy. Debt in the Fund increased by 17.1% to R1 726 million (30 June 2023: R1 473 million). |
| Significant advances in several early-stage assets led to a maturing portfolio Over 80% of the portfolio is now contributed by mature and high-growth investments. TymeBank achieved break-even in December 2023, sustained profitability is expected in the coming months and it generated fair value gains of R1 181 million. Linebooker achieved break-even and generated fair value gains of R79 million. Rain meets its economic and customer service-related targets, generating R2.5 billion EBITDA, resulting in a fair value gain of R598 million. |
| Considerable synergy realisation through collaboration within the financial services ecosystem The integration of the Sanlam 3rd Party Asset Management and Absa Asset Management resulted in substantial scale benefits and cost savings. Sanlam and Alexforbe's collaborations led to a substantial reduction in cost per member and improved client experience and capital management. Sanlam and Capital Legacy transactions drive value by leveraging a strong balance sheet and an enhanced distribution capacity. Successful integration of Retail Capital into TymeBank and Retail Capital launched with GOtyme in the Philippines. |
| Portfolio pivot towards high-growth technological innovation High-growth businesses contributes 54% of the portfolio. |
| TymeBank – 11.8% growth to 9.5 million customers and increased activity levels per customer.
Tyme Global – grew customer base to 3.6 million within 18 months of launching GOtyme in the Philippines. |
| Major additional investments: |
| Additional investment in Rain and Tyme Group of R126 million and R169 million, respectively.
Additional investment in ARCH Emerging Markets of R161 million. Investment of R143 million in ARCI shares, benefiting from the considerable discount compared to net asset value.
Continued support of Kropz amounting to R602 million. |
| Overview: |
| ARC Investments has a diverse portfolio of listed and unlisted assets valued at R20.2 billion. Several key factors impacted the ARC Fund portfolio during the period under review, both positive and negative. The national election and establishment of the Government of National Unit (GNU), lower inflationary pressures and reduced levels of load shedding have provided some reprieve and diminished the uncertainty faced in June 2023. However, the prevailing high interest rate, high unemployment rate, falling levels of consumer spending and volatile foreign exchange environment created challenging trading conditions for some of our portfolio companies. The diverse investment portfolio of ARCI has, however, shown remarkable resilience against this challenging macroeconomic environment. |
| Performance highlights |
| The Company’s intrinsic investment value in the ARC Fund increased by 21.5% from R15 328 million at 30 June 2023 to R18 616 million at 30 June 2024 |
| The IFRS Net Asset Value (NAV) per share increased by 7.9% from R11.44 on 30 June 2023 to R12.34 on 30 June 2024. The lower increase in NAV per share was a result of the increase in the number of shares through the right issue and performance participation. |
| For the full report click the link below:
ARC Investments |
