Bidvest Namibia release condensed annual financial results

September 1, 2015, 8:32am

Bidvest Namibia release condensed annual financial results

Bidvest Namibia recently released their condensed annual financial results, which showed that revenue dropped by 4.6% to N$3.5 billion, with trading profit also dropping by 17.1% to N$415.6 million. Dividends have also been cut by 11.1% to 56cps.

According to Bidvest Namibia, the main contributor to trading profit remains the fishing division (83%), despite a decline of 15.1% in profit. The decline was a consequence of a smaller allocation of the horse mackerel quota in the second allocation of the 2014 calendar year.

Their fishing division has its work cut out. Even though there appears to be no credible plan to turn things around, and a severe lack of urgency as a result of the division having endured too much hardship and quota cutbacks in the past, it actually increased its total share of trading profit.

The freight and logistics’ division performed worse than expected, showing an 18.5% decrease in trading profit, largely due to lower oil and gas project activity. Food and distribution, however, had disappointing results, with trading profit declining by 61.1% to N$9.6 million.

Commercial and industrial products and services performed well, showing a 21.1% increase in trading profit, with an increase by 28.2% in cash generated by operations creating further capacity for expansion.

The fishing division continues to face challenges regarding accessing a sufficient horse mackerel quota to fully utilise its catching capacity. Pressure on prices and the availability of horse mackerel quotas will also continue to affect this division.

Strong results are expected from their commercial entities. Freight and logistics is expected to continue to seek for project activity opportunities. The food and distribution division is also working hard to remedy the poor performance of the past year, and will continue its efforts to find innovative ways to replace the loss of the local poultry distribution.

Subsequent to year-end, the group acquired a 100% shareholding in International Capital Investments (Proprietary) Limited, trading as Novel Motor Company, and Lenkow (Proprietary) Limited, an established motor dealership, which is the main representative of Ford and the sole representative of Jaguar, Land Rover, Volvo and Mazda vehicles in Namibia with effect from July 31, 2015 for N$238.1 million, in line with its continued strategy to diversify its business portfolio.

Novel Motor Company is a well-known vehicle dealership, while Lenkow (Proprietary) Limited owns the Windhoek showroom and service centre premises from where Novel Motor Company operates.

In addition, the release shows that Bidvest Namibia has obtained a 49% share in Namibia Bureau de Change on July 16, 2015 for N$8.5 million, a company which provides foreign exchange services to individuals and businesses, which is further diversifying the activities of the group.

Despite disappointing results in most divisions, the Bidvest Namibia team remains positive, motivated and dedicated to finding solutions for the challenges which are being encountered.

Bidvest Namibia management have concluded the initial feasibility study to convert the current horse mackerel fishing operations to a shore-based processing facility. The board has thus resolved to proceed with environmental impact assessments and civil and detailed design work.

By Frans Nghandi