Contribution to headline earnings | 30 June 2024 R million |
30 June 2023 R million |
---|---|---|
KTH | 241 | 437 |
Other | (6) | 397 |
235 | 834 | |
Kagiso Tiso Holdings Proprietary Limited
(KTH)
Effective interest 43.5%
Profile: KTH is an established black economic controlled company with a focus on investment banking services, media and strategic investments. Its major investments include Kagiso Media Limited (Kagiso Media), Momentum Group Limited (Momentum) and Servest Group Proprietary Limited (Servest).
Corporate information
Sustainability measures
Financial highlights | Year ended 30 June 2024 | |
---|---|---|
R million | % | |
Revenue | 1 898 | 8.3 |
Operating profit | 750 | (27.4) |
Headline earnings | 553 | (45.0) |
KTH is a leading black-owned investment holding company with a strong and diversified asset portfolio comprising a mix of listed and private investments in the media, financial services, industrial services and healthcare sectors.
KTH’s contribution to Remgro’s headline earnings amounted to R241 million (2023: R437 million).
KTH’s headline earnings for the year decreased to R553 million from R1 005 million in the comparative year. This decrease is mainly due to the conclusion of the disposal transaction in Actom Investment Holdings Proprietary Limited (Actom) in the comparative year, whereby Nedbank Limited waived its right to receive payment on the remaining balance of the amounts outstanding under the term loan agreement. This resulted in KTH recognising a debt forgiveness gain of c.R520 million. Excluding the debt forgiveness, KTH’s headline earnings for the year increased from R485 million to R553 million mainly due to:
- revenue from Kagiso Media, which was 9% above the prior year at R1 467 million (2023: R1 342 million), and revenue from Lupo Bakery Proprietary Limited, which was 6% above the prior year at R430 million (2023: R406 million);
- a positive fair value movement on its preference share investment held in Momentum (R127 million) driven by an increased Momentum share price (2023: R99 million). These preference shares were converted to ordinary shares in June 2024;
- increased net finance income for the year of R57 million (2023: net finance cost of R39 million). Interest earned on cash balances has positively added to improved returns. The settlement of the debt associated with the Actom investment in the comparative year resulted in a reduction in finance costs; and
- flat equity accounted income of R230 million (2023: R234 million), largely driven by equity accounted income on its investment in Momentum (R245 million), Kagiso Media Radio associates (R35 million) and Aurora Wind Power Proprietary Limited (R11 million), partly offset by equity accounted losses recognised on Servest for the year of R61 million.
KTH’s attributable earnings for the year amounted to a profit of R604 million (2023: R949 million). In addition to the abovementioned items, KTH’s earnings also include the following:
- an impairment reversal of R60 million that was recognised on the investment in Servest (2023: an impairment of R58 million); and
- an income tax expense that was higher due to capital gains tax paid on the conversion of the Momentum preference shares to ordinary shares.
During the year KTH successfully concluded the disposal of Imvelo Concession Company Proprietary Limited that resulted in the derecognition of the investment held in terms of IFRS 5 in the comparative year. KTH also converted its Momentum preference shares, thereby increasing its Momentum shareholding from c.6% to c.8%. As part of the conversion process, KTH settled all outstanding debt relating to the preference share structure using its internal cash resources.
KTH paid a dividend of R44 million to shareholders in November 2023 and R70 million in April 2024.
Prescient China Equity Fund
(Prescient)
Effective interest 37.1%
Profile: Prescient, which uses a systematic, quantitative approach to seek long-term capital growth, invests in listed stocks in the Chinese market and is benchmarked to the Shanghai Shenzhen CSI 300 index.
Website: www.prescient.co.za
Invenfin Proprietary Limited
(Invenfin)
Effective interest 100.0%
Profile: Invenfin focuses on smaller early-stage investments.
Website: www.invenfin.com
Asia Partners I LP and Asia Partners II LP
(Asia Partners)
Effective interest 6.5% (Fund I), 10.0% (Fund II)
Profile: Asia Partners makes private equity and private equity-related investments in technology or technology-enabled companies focused primarily on the Southeast Asia region.
Website: www.asiapartners.com
Pembani Remgro Infrastructure Funds
(PRIF)
Effective interest 16.2% (Fund I), 37.4% (Fund II)
Profile: PRIF is a fund focusing on private sector investment in infrastructure across the African continent.
Website: www.pembani-remgro.com