Shareholders of the multimillion-Pula tourism and safari outfit, Wilderness Holdings Limited, continues to make fewer returns since its Initial Public Offering (IPO) on Botswana Stock Exchange (BSE, BG Business has found.
A peep into Wilderness’ full year results for four financial years shows that, the company’s Basic Earnings Per Share (EPS) were higher in 2010, just after the company listed on the local bourse, but fell 62 percent up to 2013. In 2010, Wilderness’ basic EPS were valued at 20.57thebe, before they almost doubled to 43.79thebe in 2011. In 2012 however, Wilderness’s EPS fell dramatically to 4.91thebe per share but rose slightly to 12.80thebe in 2013. Stock market experts attribute the fall to the declining profits and net income. Tlotlo Ramalepa, a stockbroker at Motswedi Securities says normally the rise in EPS coincides with the rise in profitability and the company’s net income. He said EPS could simply translated as the return on shares invested by shareholders.
“The higher the earnings per share, the more the shareholders benefit,” Ramalepa said, adding that when a company’s profitability crumbles, its EPS also shrinks. Wilderness, a company headed by Derek De La Harpe, saw its after-tax profits rising by almost 100 percent to P92 million for the 2011 financial year from 2010. At the same time, the company’s basic EPS also shot up by over 100 percent to 43.79thebe. This was also the only time that Wilderness shareholders smiled all the way to the bank after the board of directors declared an 8.6thebe/share dividend.
At the time, P89 million was paid to shareholders as dividend. In the 2012 financial year, Wilderness, currently chaired by prominent lawyer Parks Tafa, saw its basic EPS diminishing by 88 percent to just 4.91thebe. This happened at a time when Wilderness’ post tax profits also dwindled by 91 percent on account of costly significant investments made by the company. During that period the board had only P8.1 million declared to shareholders, at 8.6-thebe/share dividends. Although its basic EPS rose slightly in 2013, it still remains dramatically low at only 12.80, having risen by 161 percent from the 2012 basic EPS.
At least the profits also rose to P27 million, giving an increased value to shareholders who were allocated P24.5 million dividends at 4thebe per share.