Capricorn Group Limited is projecting improved profits for the half year ending December 31, 2021.
In a trading update released this week, the group said it expects its profit after tax, from continuing operations for the six months ended December 31 2021, to increase by between 20% and 25% compared to the prior period.
At the same time, the listed financial services group expects profit after tax including discontinued operations to increase by between 32% and 37%.
Headline earnings and earnings per share for the period under review are expected to be higher than the prior period by between 30% and 35% and 35% and 40% respectively.
“During the six months ended 31 December 2021, the economy benefited from an improved operating environment and relaxed COVID-19 restrictions, when compared to the comparative period. The improved environment and increased economic activity, albeit from a low base, had a positive impact on the Group’s impairment charges and non-interest income. Additionally, the successful disposal of the Group’s Zambian interests on 4 January 2021 resulted in losses from Zambian operations incurred during the comparative period not being repeated,” the company said in a trading statement.
Simonis Storm forecasts Capricorn’s half year profit after tax to range between N$513.8 million and N$535.2 million, with earnings per share anywhere between 99.3 and 103.0 cents per share.
“We are pleased with the results, the company being well on its way to achieve our financial year end (FYE)22 profit after tax estimate of N$1,172.4 million [i.e., 43.8% – 45.6% of the way there]. We expect pre-Covid earnings to be breached in FYE22, likely to see positive teen growth percentages on full year 19 earnings. We also agree with the origins of this recovery, with one chief concern, where is long-term growth going to emanate from? The economy is currently a lackluster, spurting machine, and although we can see the lower / unwinding impairment earnings boost and gradual interest rate hike tailwinds, it is not compelling longer-term,” the stock broking firm said.
Capricorn Group disinvested from Zambia after it concluded a purchase agreement with Access Bank Plc for its entire interest in Cavmont Capital Holdings Zambia PLC.
The Capricorn Group has a 100% interest in Bank Windhoek, 84.8% holding in Capricorn Investment Holdings Botswana which owns Bank Gaborone, 55.5% interest in Entrepo Holdings, 29.5% holding in Sanlam Namibia Holdings , 28% stake in Santam Namibia and 30% in Paratus Group among other interest.
