Black-controlled investment company Brimstone says, although 2013 was a challenging year, the financial results for the year ended December 31, 2013, were satisfactory.
“The earnings achieved for the year under review were attributable to lower fair-value adjustments of certain underlying investments and a reflection of the challenging economic conditions in the insurance underwriting mar-ket, which were partially offset by profitability at integrated fishing company Sea Harvest,” says Brimstone executive chairperson Fred Robertson.
Sea Harvest is one of the companies in which Brimstone invests and has produced satisfac-tory results, compared with the previous period. Sea Harvest’s revenue increased by 20% to R1.2-billion in 2013, despite fewer catches from the 2012 financial year.
The company performed well, with export revenue increasing by 22% and local sales reve-nue increasing by 28% for the 2013 financial year, maintaining its market leader position, adds Robertson.
Increased Assets Brimstone notes that the value of its total assets increased from R5.7-billion as at December 31, 2012, to R6.8-billion as at December 31, 2013. Net asset value of R3.2-billion for the 2013 financial period compared favourably with R2.8-billion for the corresponding period in the previous year and translates into a net asset value for each share of R13.24 at year-end. The intrinsic net asset value increased by 16.1% from R3.6-billion to R4.2-billion as at December 31, 2013, which translates into R17.09 per share, compared with R14.74 per share at the previous year-end.
Also, basic headline earnings amounted to R461-million as at December 31, 2013, compared with R844.4-million for the December 31, 2012, financial year. Basic headline earnings for each share for the 2013 financial year were also lower at 189.9c for each share for the comparable period.
“These are satisfactory financial results, considering the challenging and subdued domestic market considerations in which they were achieved. “Our underlying subsidiaries, with the exception of insurance, performed well in tough conditions and our investee companies maintained good revenue growth, delivering above-average returns for our shareholders,” says Brimstone CEO Mustaq Brey.
He points out that revenue for the 2013 financial year increased by 7.2%, from R1.9-billion to R2.1-billion, while net profit before taxation softened to R555-million from R1.1-billion for the comparable period, owing to a R496-million reduction in fair-value adjust-ments of the underlying investments.
Brimstone declared a final dividend of 30c per share and a special dividend of 10c for each share.
“Brimstone received a special dividend from Life Healthcare on March 17. The board of Brimstone has, therefore, decided to distribute part of this income to our shareholders as a special dividend,” states Brey.
Robertson highlights that Brimstone remains well capitalised and has substantial approved facilities to pursue significant transactions, which is value enhancing for its shareholders.