Bidvest Namibia is still facing stringent economic challenges especially in its trading divisions. The group released its financial results for 2017-2018 this morning during annual investors presentation.
During the fiscal year Bidvest sold its entire shareholding in Bidvest Namibia Fisheries (“Bidfish”) to Tunacor Fisheries Limited with effect from 30 June 2018, enabling it to act on its strategic decision to exit the fishing industry. The Fishing division has experienced a number of challenges in growing its revenue, profit and cash flow. The fish size mix remained under pressure and competition from foreign operators was rife, while market prices remained depressed. This in turn impacted negatively on profit margins. Similarly new taxes and levies, and an export levy added to the cost of doing business harshly affected earnings. The division also had to deal with additional costs following the required application of income tax to foreign crew. One Horse Mackerel vessel was sold during the year under review.
The disposal of Bidfish to Tunacor excludes the Angolan and Mozambican businesses, and certain vessels, plant and equipment. Bidvest is actively seeking sell-off these assets. Glenryck is now reported as part of Food & Distribution division. Namsov Industrial Properties (Proprietary) Limited and United Fishing Enterprises (Proprietary) Limited were acquired by Bidvest for a net cash outflow of N$74,9 million.
With the continued economic recession the other Bidvest Namibia divisions all experienced pressure on revenue. The Automotive division faced an extremely tough year as reflected in the 14% decline in industry sales. The used-vehicle market did not make up for the overall negative performance. Efforts continue to reduce the dependence on the new-vehicle segment in this division. Although Freight & Logistics revenues were flat year on year, they improved trading profit in the current year through cost savings. There are prospects of certain Oil and Gas projects on the immediate horizon. Food & Distribution revenue, excluding Glenryck, did not grow in line with expectations and generated losses for the year. The year saw a management and structural shakeup in this division with cost savings and overall business rationalisation projects underway.
The economic climate affected all entities in the Commercial & Industrial Services and Products division negatively, except for Cecil Nurse, Kolok, Minolco, Steiner and Waltons. Voltex continued to generate losses despite actions taken to turn the business around. The effective tax rate is high due to losses incurred in certain statutory entities, for which no deferred tax assets were raised. Current assets include amounts of N$188 million relating to dividends receivable from Bidfish, this was received in full post-year-end, and of the N$190,7 million due by Tunacor Fisheries Limited relating to the disposal of Bidfish, N$175,4 million was paid in July 2018 with the balance due within five business days after delivery of the effective date of the financial statements. Non-current assets have reduced by 40,9% mainly due to the disposal of Bidfish. The Angolan and Mozambican businesses are disclosed as assets held for sale at year-end. Bidvest is in a net cash position at year-end.
Presently there is no indication that the Group’s market segments and economic climate will improve in the short term. Going forward, after the conclusion of the disposal of the Fishing division, the operational challenges in all divisions are receiving significant focus with loss-making operations under the spotlight. Overall, the Group remains open to acquisitive growth, but the emphasis will be to optimise current operational structures and processes. The Group remains optimistic that profitability will regain momentum in the near future despite the recessionary economic climate.
A final cash dividend of 10 cents per share has been declared.
Shareholders of Bidvest Namibia are referred to the circular to Bidvest Namibia Shareholders containing details of a conditional take-over by the Bidvest Group to Bidvest Namibia Shareholders, to acquire all remaining Bidvest shares not owned by the Bidvest Group by way of a take-over scheme (‘offer’). Subsequent to the acceptance of the Delisting Resolution by the requisite majority, the offer has been declared unconditional by the Bidvest Group and has become effective, irrevocable an open for acceptance during the Acceptance Period.
Further to the cautionary announcement released on the Stock Exchange News Service (“NENS”) of the Namibian Stock Exchange (“NSX”) on 12 December 2018, the subsequent renewal of the Cautionary Announcement released on NENS on 23 January 2019 and 1 March 2019 and the announcements released on NENS on 11 April 2019 and 25 April 2019. Shareholders are hereby advised that the requisite majority of Bidvest Namibia shareholders eligible to vote, have approved the delisting. In terms of this passed resolution, the listing of all the Bidvest Namibia Shares of
Bidvest Namibia on the Main Board of the NSX be suspended and terminated with effect from 11 June 2019 or at such times and such dates as will be approved in accordance with the Bank of Namibia and by the NSX
Further to the cautionary announcement released on the Stock Exchange News Service of the Namibian Stock Exchange on 25 April 2019 relating to the circular to shareholders, supplementary information relating to the sum of the parts valuation, culminating in the fair and reasonable valuation range of N$8.95 to N$9.45 as per the E&Y Fair and Reasonable opinion included in the circular, is available on the this website.
Further to the cautionary announcement released on the Stock Exchange News Service of the Namibian Stock Exchange on 12 December 2018, the subsequent renewal of the Cautionary Announcement released on NENS on 23 January 2019 and 1 March 2019 and the announcement released on NENS on 11 April 2019. A combined circular has been issued today by Bidvest Namibia Limited and the Bidvest Group to a conditional Take-over offer in terms of sections 320 – 327 of the Companies Act….