Botswana Post, which has been posting losses, has turned the corner thanks to a number of interventions implemented by the new leadership. The latest annual results are a clear indication the government-owned postal service provider is out of the woods.
The parastatal’s annual financial report for the 2017/18 year indicates a profit after tax of P3.1 million, a significant 139.4 percent turnaround from the previous year’s loss. The development is attributed to change in revenue appreciation of the parastatal’s virtual sales, mainly electricity and airtime propelling the company to consider investing more in technologies.
“An investment of USD13.9 million has been committed to system development to keep up with advances in information technology over the next ten years,” said Ofentse Mabote, Botswana Post Chief Finance Officer (CFO). During the financial year under review, the virtual sales were recognised on a net instead of a gross basis.
“This was due to the fact that these items are now determined to be advance payments rather than stock items as the company has little control of the tokens sold,” said Mabote. The Botswana Post’s financial chief said other income revenue recorded a 3.8 percent up from the previous year and the non-traditional revenue lines of business services and agency services grew 6 percent against 1.8 percent for traditional revenue lines.
As Botswana Post gets into full swing with its new blueprint - Executing Innovating Excellence, the company is determined to improve its systems to ensure effective management information for enhanced decision making. “The importance of technology and its assimilation in our operations as a key differentiator has been at the centre of our business strategic focus.
E-platforms have played a role in our positive developments as far as our multi-channel approach is concerned,” said Clifford Lekoko Chief Commercial Officer. Botswana Post believes opportunities exist in the market to address the growing demand for convenience, and the demand for ease of access to services, whether native or third party.“We set out to pursue a strategy of digitalization of services enacted through the post office network,” said Lekoko.
BotswanaPost has digitalized most bill payments and critical government services, answering and meeting the market demand for ease of transacting.Through the Botswana Post web portal, the following services are now available to the public in real time - online vehicle licence renewal, Postal box renewal, water bill presentment and payment, prepaid electricity purchases, money transfer, insurance premium payment and pay TV subscriptions.
Turning the fortunes of BotswanaPost was through strategies that hunt down additional sources of revenue growth and enhanced existing ones, leveraging new technology and strategic relationships.The parastatal also took bold steps to decrease controllable costs, applied a wide variety of performance improvement measures to instill a culture of high performance in every staff member and re-arranged human resources, restructuring the organisation to deliver maximum value and customer impact.
“Having stabilised our cost base and driven revenue growth across key channels, we have rapidly gone from the inflection point, beyond the break-even point, to a healthy profitable position,” said Cornelius Ramatlhakwane, Chief Executive Officer at Botswana Post.
Leading property company, New Africa Properties has posted a modest improvement in profit for the twelve months to July 2018. This is according to a financial statement posted on the Botswana Stock Exchange Limited website on Wednesday afternoon. For the period under review, the company which is under the leadership of Tobias Mynhardt, recorded a profit of P217 million, compared to P199 million made during the same period last year.
“NAP’s performance in 2018 is reflective of the sound property portfolio performance in line with the trend since initial listing, all underpinned by the strength and diversity of the tenant base occupying the well-established portfolio,” said NAP. The owners of Madirelo Centre and Riverwalk mall in Gaborone said.
Profit exceeds distributable income by P69 million as a result of the after-tax revaluation and other accounting adjustments that are non-cash flow items and do not impact distributions, but add to the underlying net asset value of NAP which has increased by 5.2% this year. “The fairly constant exchange rate resulted in a P96 000 exchange loss under other comprehensive income, in comparison to last year’s P1.4 million gain,” noted the company.
Directors of the company have disclosed the company has the necessary war chest to survive the market. “NAP has significant gearing capacity available to fund acquisitions which would enhance long term returns. The catalyst for this would be securing quality property investments at appropriate initial yields,” commented John Chairman Mynhardt and Tobias Myhardt.
Furnmart this week disclosed the draft National Credit Amendment Bill in South Africa, which proposes that all or part of the debt under certain qualifying credit agreements can be extinguished will hit them hard.
The Botswana-based furniture retailer has several furniture shops in South Africa, the continent’s most industrialised economy. However, the new bill will have devastating impacts on their bottom line, especially that some of their customers, including low income earners have credit arrangements with the group.
“This amendment bill is of great concern as most of the Group’s South African customers fall in the income bracket that this legislation is targeting,” said the company when announcing full year results to July 2018. For the period under review, the company recorded a 67 percent jump in profits to P107, 9 million. The results are up on back of growth in revenue and operating income.
The operating income was picked up by the closure of some of their non-performing units. Meanwhile, cash generated from operations has declined by P26.8m mainly due to an increase of P83.3m in the group’s debtor’s book, resulting in lower cash and cash equivalents. Nonetheless, the group has continued to expand its footprints.
“The Group opened nine new Furnmart stores during the period under review and is now trading out of 129 stores in three countries,” said the company manager Daniel le Roux. However, the company will be cautions with expansion in South Africa, which its economic forecast has also been reduced.
“The furniture retail market in Botswana and Namibia remains overtraded and imminent sweeping regulatory changes, in these markets, may present future headwind,” said the BSE listed group.
Korea is upbeat that continued trade exchange with Botswana will strengthen the two countries’ bilateral relations.Dr. Jong-Dae Park Korea’s ambassador to Botswana this week told delegates at the Global Expo in Gaborone that the two countries' relationship is expected to blossom beyond the 50 years celebrated, this year.
“Korea and Botswana will further strengthen their long standing friendship, with the business sector continuing to be a key area of co-operation,” said Dr. Park. He said networking forum such as Botswana’s Global Expo provide a great opportunity for businesses from both our countries to further strengthen their ties and explore future collaborations. Dr. Park said the two countries have exceptional economic success in the world envied by their peers on the globe.
“About four decades ago, both Korea and Botswana were among the poorest countries in the world that had experienced colonial rule. However, both our countries now proudly present themselves as economic success stories, which is quite unique in world history,” he said.
Statistics indicate that Korea is the 7th country in the world to have achieved the ’30-50 club’ status, that is, having nominal per capital GDP of over 30 thousand dollars with a population of over 50 million, while Botswana is classified as an upper-middle income country with a GDP per capita of 17,000 US dollars in real terms.Dr. Park also applauded Botswana as a leader in transparent and efficient governance on the African continent.
On the other hand, Korea is the world’s 9th largest trading nation, achieving $901 billion in trade.With a diversified export portifolio driven by commodities products to IT and heavy chemical industries, Korea envisages to extend more of its products and services into Botswana.
Some of the leading Korean companies that have already made inroads in the country include Doosan, Daewoo and POSCO engaged in large-scale projects in the fields of construction, energy and resources management.
Meanwhile, Korea’s export development arm KOTRA said Botswana’s ranking as Africa’s most politically stable Nation is the main attraction for Korean companies.