COMPANY NEWS IN BRIEF
African Bank's profit slumpsAfrican Bank's annual profit has slumped by almost a third after it was forced to about double its provisions to cover souring loans even as it ramped up advances.
The group, which was rescued after the near collapse of its former parent African Bank Investments (Abil), said profit attributable to shareholders plunged 31.4% to R505 million in the year to end September. The drop in profit came as net loan advances rose 41% to almost R32 billion.
"Our net profit is a testament to our resilience and sustainability, and our dedication to realising the enduring vision of our founders," CEO Kennedy Bungane said in a statement.
"This year's financial results reflect our strong and audacious commitment to strategic growth and diversification. It takes audacity to defy the odds, which is what we have achieved with the evolution of African Bank from a mono-line credit lender to a fully fledged retail and business bank."
At the same time, African Bank said its impairment provision released in respect of bad debt writeoffs during the financial year increased to almost R4 billion, with the vast majority of this amount going towards its consumer banking unit.-Fin24
Coronation's profit halves amid tax dispute
Coronation Fund Managers has declared a final dividend despite seeing its annual profit halve after it was forced to set aside hundreds of millions of rand to settle a tax dispute. The assets it manages also remain under pressure due to ongoing volatility in financial markets.
The Cape Town-headquartered asset manager reported on Tuesday that profits slumped 50% to R640 million for the year ended September 2023.
Nevertheless, Coronation still declared a final gross dividend of 165c per share even after fully providing for its tax dispute with the South African Revenue Service (SARS), though that was 57% down year on year. Coronation said in May, when it published its interim results, that the SARS tax liability amounted to R716 million, but its full-year results indicated the liability was R761 million.
"The year under review was a continuation of the difficult environment that the business has been operating in for the last few years, with anaemic market returns across domestic asset classes reflecting the very weak performance of the South African economy," Coronation said in its results.-Fin24
Telkom asks for spectrum auction delay
South Africa's third-largest mobile operator Telkom has asked for a delay of the next auction of high-demand spectrum by a year, citing the effects of a difficult economic environment, including load shedding.
The first spectrum auction took place in 2022 after a number of delays, including legal action from Telkom, which had argued the process had been skewed in favour of larger players. The release of spectrum is expected to improve data connectivity in SA and reduce data costs.
The Independent Communications Authority of South Africa (Icasa) said it wants to conclude the licensing process by the end of March 2024, and Telkom said it had requested a delay until 2025.
This is "on the basis that studies still need to be completed by Icasa in preparation for the next auction, and that the current challenging economic environment, including the impact of load shedding, will make it particularly difficult for Telkom and other market participants to partake in the auction."-Fin24
Naspers, Prosus expect profit growth
In a trading statement for the six months to end-September, Naspers and its consumer internet arm Prosus forecast strong profit growth.
Naspers' core headline earnings per share is expected to more than double ( 108% to 115%) from 204 US cents, while Prosus expects an increase of between 91% and 98%.
Profitability improved in its e-commerce businesses - which include online classifieds, food delivery, payments, fintech and education technology, Prosus said. Among others, it owns the food delivery platform iFood in Brazil, the online payment group PayU and the classifieds group Olx.
The group said it was on track to reach consolidated profitability in its e-commerce businesses, which have reported large trading losses. Previously, the group said that it would achieve profitability during the first half of the financial year ending in 2025.-Fin24