Botswana Stock Exchange (BSE) listed oil-company, Engen Botswana has announced intentions to continue investing and expanding footprint on the local market. “We continuously seek to improve our operating performance and maximise sustainable results,” said Engen chairman, Shabani Ndzinge in the company’s latest annual report released to shareholders, this week.
“Additional service stations are earmarked for 2019, and we expect to continue to grow our retail facility footprint during 2019 and beyond,” he added.Engen wants to develop its retail network until reaching a level of critical concentration that will be consistent with its strategic objectives, as the commercial side of the business continues to be an important component, according to the company.
Last year, a number of new retail sites were streamed, which include Engen Palapye Riverview and Engen Bokaa. And the new retail outlets include convenience facilities such as Quick Shops and food offerings. As the company sees a positive future, emphasis is also on health, safety, security, the environment, our ethics and core beliefs, Ndzinge said.
He further said several indicators including improving employment figures suggest that the economy has largely recovered from the effects of the closure of BCL mine and associated support industries. “We remain convinced that steady growth and increasing diversification will see a stronger Botswana economy in the short to medium-term.” On the other hand the company says it strives to attract and retain highly qualified and motivated employees.
“Engen endeavours to close skills gaps and keep employees up-to-date with the latest market trends in their respective areas of operation, and maintains a robust programme for people development, aimed at building and supporting our most important asset – our people.”
Engen is also optimistic that government’s plans to create a conducive environment in which the private sector can develop augurs well for future economic growth. The company also believes the continued economic diversification away from mining output to other non-mining sectors is likely to create further growth opportunities. “We therefore expect the company to show strong performance in 2019 in both the retail and commercial arms of the business.”
Ndzinge emphasized that the company will continue to grow its market position in the years to come, as the local market still has room for growth despite the significant number of new retail facilities being built in the country. Engen is a petroleum company specializing in fuels and lubricants sales and distribution. It operates filling stations nationwide to service the retail market. Primary customers are the mines, government, parastatals, construction and transport sector.
Standard Chartered Bank Botswana, the oldest bank in the country has announced that profit before tax for the year ended 31st December 2018 will be between 105% -109% (approximately P243million to P253million) higher than that reported for the comparative period ended 31 December 2017.
For the year ended December 2017 the Botswana Stock Exchange listed bank recorded a loss of P232 million. “The Board of Directors hereby announce that the Group’s profit before tax for the year ended 31 December 2018 will be between 105 percent to 109 percent higher than that reported in the comparative period ended December 2017,” reads the statement from the Board of Directors. The bank suffered declining income over the past years primarily due to impairments arising from the mining industry.
Presenting last year’s full year results, Standard Chartered Bank Botswana Chief Executive Officer, Mpho Masupe said that they are beginning to see green shoots which are indicating that the trajectory is good as the bank also continues to control its impairments. “We have also seen that credit growth hasn’t necessarily been growing as much as it should have.
We are seeing 6.8 percent in credit growth for the year, mostly from the household side,” says Masupe, adding that this is an area they are concerned about because it makes them a lot more cautious in terms of extending credit. The bank registered a three percent decline in overall assets, arising from the portfolio rebalancing and this happened only in two segments. The bank registered a five percent increase in the retail sector in terms of client assets.
According to the Bank of Botswana Monetary Policy 2019 statement, household credit continues to account for a larger proportion of credit at 60.2 percent of total bank credit as at December 2018. However, the level of non-performing loans to total credit remains modest at about five percent between December 2017 and December 2018. The central bank stated that household credit is concentrated in unsecured lending.
“A concern would arise in the event of high levels of borrowing that are out of line with trends in economic and personal income growth, which would amplify the risk or exposure of households and businesses to economic shocks and may adversely affect their ability to repay debt,” said the bank.
Botswana Stock Exchange (BSE) listed property company, PrimeTime is optimistic that its retail portifolio will record positive growth, as impasse on licensing of foreign retailers has been resolved.
The company’s 2018 annual report released this week indicate that the occupational retail market is now settling down following a period of uncertainty as foreign retailers’ expansion was impaired by licensing difficulties. “That issue now appears to have been resolved, which has given the sector a renewed confidence,” said Sandy Kelly, Managing Director for Prime Time.
Over the past three years, investment and trade authorities have been at loggerheads with business community over the licensing of foreign retailers. In 2016, 30 percent of South African retailer tenants on Prime Time’s Pilane Mall were denied trading licences by the government, a development that dented the company’s revenues. Apart from retail space, Kelly said office market is developing rapidly on the local market, with new developments in the CBD continuing to rise from the ground and a real critical mass of businesses now located there, pulling more occupiers to the area.
Kelly notes that the property market has seen a rapid expansion over the past years with substantial new space delivered in the office and retail sectors. “Investor appetite for high-quality assets is strong, supporting capital values through competition between buyers for standing institutional grade property. Although competition has compressed yields, there will be investment opportunities in various markets across the country as Botswana grows,” said Kelly. Some of the properties under Prime Time’s portifolio on the local market are Mantlo House already sold above book value, AFA HOUSE undergoing renovations with a new lease signed, The Design Quarter and Ramotswa Shopping Centre. Kelly said several of the company’s properties on the local market are subject to ground leases and as their terms shorten the market value is adjusted accordingly.
“We are at the advanced stages of negotiating a substantial extension on one of these and on purchasing the freehold on another, both of which should be completed in the 2019 financial year.”In Zambia, despite the ups and downs of the copper price and Kwacha in recent years, Prime Time’s footprint is growing due to urbanising population and a general lack of good quality stock.
Kelly said urbanisation and limited stock present a compelling case for the long-term prospects of the property market.“There has also been considerable retail development, which is taking a while to absorb in some areas, especially parts of Lusaka. “However, the overall provision of formal retail space in comparison to other countries in the region is low and will provide opportunities for investment for years to come,” Kelly said.
In the first week of trading on Botswana Stock Exchange (BSE)’s new Serala platform Botswana Building Society Limited (BBS) has shown good success with over 32 000 shares traded in the second week of trading.
BBS limited is the first company to trade on the newly launched Serala over the counter platform. The platform allows unlisted companies to trade on BSE. According to the weekly report by Imara Capital Securities, for the trading week ending 07 September 2018 (BBS having registered on the Serala platform on Monday 03 September), 166,626 shares were traded worth P183,289.00 while on September 14, and 32,236 shares were traded worth P35, 460.
In response to BG Business questionnaire, BBS Head of Marketing and Communications, Sipho Showa said acquisition of shares was a resounding success.“Many former Botswana Building Society shareholders bought ordinary shares in the new entity being BBS Limited.
Customers bought the ordinary shares using shares then known as Paid Up, Subscription and Indefinite Period Shares under the then Building Society. 25,862 existing shareholders bought a combined 487 million ordinary shares in BBS Limited. He highlighted that BBS Limited will consider an IPO about two to three yearspost commercial bank operation. Currently, BBS Board indicated that they will submit the application for the commercial banking license at Bank of Botswana in the next few weeks.
Kgatleng BTC Premiership outfit Mochudi Centre Chiefs have appointed the Chief Executive Officer of the Botswana Stock Exchange, Thapelo Tsheole as their team president. Tsheole, who commands an illustrious background in corporate governance, is expected to contribute in propelling the Kgatleng club to new heights in both governance and strategy.
Tsheole joins Magosi at a time when the team is seeking to revive their fortunes following a difficult 2017/18 season, both financially and in the pitch. In an interview this week, Magosi chairman Raymond Tsheko confirmed that they appointed the BSE Chief as president.
Tsheko described Tsheole as a champion of corporate governance and strategy. Tsheko further explained that Tsheole who champions community projects is expected to advise the team on strategic decisions in the future.
“We seek to promote ethical leadership and maintain a sustainable model for the team. There is need to raise the bar high and achieve what we have set out to do in football,” Tsheko said.
The Magosi chairman said the appointment of the Corporate governance guru will ensure that the team is run well and complies with statutory requirements. “We must further ensure that people who run the club are of a good standard.” Tsheko further explained that there is need to ensure that the organisational makeup of the club is inclusive to stakeholders.
Commenting on the matter this week, Tsheole said his recent appointment to Magosi comes as a voluntary service to the community. “It was not the first time I was approached to be the team president. They have been approaching me for the past two years but this time I agreed”.Furthermore. Tsheole explained that he will not be involved in the day to day operations of the football team. “I am just a ceremonial figure. “
The BSE chief said he will assist in providing a higher level of policy and vision for the Kgatleng team. Tsheole said he will use his expertise in the corporate world in an effort to help the team move forward. The Mochudi native says he has been supporting Magosi from his early days.
I have played for the Centre Chiefs development team in the Chappies league a long time ago. I later went on to play for another team in the National First Division in Gaborone.
Botswana Stock Exchange (BSE) listed furniture retail group, Furnmart, has announced that it will continue with new store growth in South Africa after closing its Zambia operations last year.
In its year ended July 2017 report the group recorded marginal decrease in revenue of P1.17 billion compared to P1.18 billion recorded last year. Commenting on the published results, Furnmart Managing Director, Daniel le Roux and Chairman, John Mynhardt attributed the decline to the closure of Zambia operations.
“However, excluding the discontinued operations, revenue increased, compared to the prior year. Gross profit margins were lower than last year, mainly due to the closing down of sale operations and a very competitive, subdued trading environment elsewhere,” said Mynhardt.
He said the group’s businesses in the chosen markets and territories are well positioned to take advantage of the inevitable improvement in market conditions. “Our focused management teams will continue to seek growth opportunities in the region. Management will continue with moderate new store growth, primarily in South Africa,” said Mynhardt.The company stated that the difficult trading environment was brought about by low economic growth, increased competition and high levels of consumer debt in the region. Profit after tax increased by 35 percent to P64.5 million compared to P47.7 million recorded in 2016. Operating income declined by 5.6 percent to P130.2 million due to the closing down of Zambia shops, higher operating expenses and lower finance income earned.
The group realised an exchange gain of P10.6 million compared to an exchange loss of P16.9 million last year as the Pula weakened steadily against the Rand during the financial year.
During the year the group opened four new Furnmart stores and it is now trading out of 120 stores in three countries, Botswana, South Africa and Namibia.
Shumba Energy Limited, a Botswana-based energy development company, has been approved by the Botswana Stock Exchange to migrate its listing from the Venture Capital Market Board to the Main Board of the local bourse effective 30th October 2017.
Shumba is focussed on exploitation of energy fuel resources for transformation into base-load power supply and for industrial thermal energy generation.
The Company has made considerable progress and since its establishment has expanded from exploration to a revenue-generating development company, with mineral ownership rights to 4.5 billion tonnes of thermal coal.
Managing Director of Shumba, Mashale Phumaphi commented that, “Shumba remains committed to providing coal and energy to Botswana and its neighbours in the SADC region. The Company’s move to the Main Board takes place at an advantageous time with Shumba having cemented itself as a major industry player while continuing to reach its development objectives and moving to revenue generation.”
Chairman of Shumba, Alan M. Clegg added,
“This migration represents execution of the second phase of the restructure of the Company’s public investment platform following its de-listing from the SEM (Stock Exchange of Mauritius) removing the negative arbitrage investors experienced.
“Our goal is to present the company to a broader and deeper investment audience and remove all impediments to improving its visibility as we work toward our goal improving the stock liquidity and tradability in shareholders’ interest. The migration on the BSE will establish a stronger platform for potential future fund raisings of development capital to achieve the Company’s growth plans as well as enhancing the investment profile of the Company.”
Shumba is an energy development company listed on the Botswana Stock Exchange (BSE: SHUMBA). Shumba has over the last seven years progressed from establishment as a coal exploration company to an energy fuels and base load power generation development-company and currently owns the rights to over 4.5 billion tonnes of thermal coal resources which are amenable to exploitation for use in a number of energy transformation processes.
As a leading energy sector player, Shumba’s mission is to contribute to reducing the deficit and satisfy the growing energy demand in the SADC region that has resulted in chronic power outages for industries and domestic consumers alike.
Stanbic Bank Botswana has no immediate plans to list on the Botswana Stock Exchange, bank Chief Executive, Leina Gabaraane, has revealed.
Gabaraane told this publication that they don’t have an appetite to list on the local bourse as the current situation does not attract them to do so.
“As we stand now there is no immediate plan to list. There are many factors that we need to consider before listing and none of them has met our requirements. One of them is to raise capital and we don’t need to raise capital,” said Gabaraane.
He said the bank was performing well on the local financial service market and will continue to do so without listing. “We believe that our contribution to the financial services sector in Botswana continues to be in existence and will continue and we don’t need to do it through listing,” he explained. He said listing on the stock exchange is important and this is why their bonds are listed on the BSE.
Listing on the stock exchange is said to be the best platform for citizens to participate in the businesses operating in the country through buying shares. There has been calls by some analysts for the bank to float its shares on the BSE, with emphasis placed on its market share. Even the central bank has also made similar calls.
“Unlike its peers, Stanbic is not listed on the Botswana Stock Exchange. The non-existence of the bank on the domestic bourse could be misinterpreted to mean lack of long-term commitment and willingness to have the Botswana public participate in the ownership of the bank,” said Bank of Botswana Governor, Moses Pelaelo.
He was speaking at the bank event to market its 25 years of existence in Botswana some few months ago. Ben Kruger, the co-Chief Executive of parent company, Standard Bank has told Botswana Guardian before that the time is not ripe for the bank to go public.
Stanbic bank is a member of the Standard Bank Group, the largest bank in Africa by assets. The bank is one of the largest and best performing commercial banks in Botswana. In its annual report for 2016, the financial institution recorded a profit after tax of up to 48 percent at P195 million.
The CEO said despite the closure of businesses, threats of closure and the challenges in the agriculture sector in the country, the bank still performed well. They recorded above budget profit and double digit year-on-year growth.
Stanbic Bank provides the full spectrum of financial services and operates within the two divisions namely the Corporate and Investment Banking (CIB) and Personal and Business Banking (PBB).
In Botswana, the bank employs over 600 workers and has a national footprint of 10 branches. Last year the bank successfully launched a new three year ‘Road To Excellence’ strategy aimed at enabling and positioning the bank as the market leader.
Eco-tourism companies, Wilderness Holdings and Chobe Holdings are expecting a mixed set of results for the past year,amid forecast that the industry will grow by nearly ten percent this year.
Botswana Stock Exchange (BSE) listed firm, Wilderness stated in cautionary note that results for the 12 months to February 2017, ‘are likely to be more than 10percent lower than those achieved in the corresponding period in the prior year’. The expected fall in profits is likely to have shareholders worried, given that the Little Mombo owner also posted a drop in profits for the past year (2016).
For the same year, the dual-listed group saw its results taking a dive by 3 percent to close at P74, 2million. The Keith Vincent -led company explained the bottom line is down for the soon-to-be released results because of unrealised losses resulting from translation of the company’s foreign currency position. However, there has been a jump in segmental profit. The company, which listed at BSE in 2010, sells its rooms in the highly volatile US dollar.
Shareholders will have a chance to read more on the financial results when they are made public at the end of the month.The report of lower profits comes amid media reports that, government is on the verge of selling the struggling national airliner, Air Botswana to Wilderness following an expression of interest. Chairman of the group, Parks Tafa has denied the latest developments in an interview with a local weekly.
Meanwhile, shareholders of Wilderness competitor, Chobe Holdings are excited that profits for the group will be higher when compared to the year ended February last year. “The board of directors hereby announces that the Group’s results for the year ended February 2017 are likely to be significantly higher than those achieved in the corresponding period in prior year,” a company statement reads.
For the year to February last year, the owners of Desert and Delta Safari made a profit of P56million, up when compared to P52million recorded the year before. The BSE-quoted company has not stated factors which led to the rise in bottom line. Writing in the company’s 2016 annual financial statement, Chief Executive Officer, Jonathan Gibson said the introduction of South African Airlink’s flight between Maun and Cape Town ‘is anticipated to contribute positively to Maun’s accessibility.
“These factors,coupled with the Group’s superior marketing strategies and ever improving product offering,are anticipated to translate to satisfactory results in the forthcoming financial year,” said Gibson. Chobe Holdings has not announced when the results will be out. It has, like Wilderness Safari, cautioned shareholders to exercise caution when dealing with its securities.
On a related matter, Chief Economist at the finance ministry, Batane Matekane told the just-ended HATAB annual conference that, the industry has grown rapidly in the past few years. Travel and tourism generated 32 000 jobs directly in 2014, representing 4.6 percent of total employment. This was forecast to grow by 2.6 percent in 2015 to reach 32 500 or 4.6 percent of total employment.
“Total employment in the tourism sector includes direct employment by hotels, travel agents, airlines and other passenger transportation services, excluding the commuter services,” said Matekane.
Choppies Enterprise Limited has announced that Vice Chairman and Executive Director, Farouk Ismail, has shifted his role to that of Non-Executive Director. However, he will keep his Vice Chairman role, deputising Chairman former President Festus Mogae. According to Choppies website, Farouk is the founder of the Ismail Group of Companies, the group now known as Choppies Enterprises.
He opened the first store in Wayside, Lobatse in 1986 and has witnessed the exponential growth of the group since. “Given his presence in the Choppies Group since its inception, he has a strong understanding of the target market of Choppies and how to address market requirements,” said the website of the Botswana Stock Exchange (BSE) and Johannesburg Stock Exchange listed grocery group.
Ismail steps down from the day to day operations at a time when the group is struggling to grow its bottom line. In Botswana, the company is facing tough competition from old and new players as well as weak economic growth, while in SA its revenues will be affected by that country’s ‘junk’ sovereign credit rating status