Afinitas posted growing revenues but the pan African investment holdings company continues to grapple with the costs associated with expansion.
In the interim unaudited financial statements for the period ended 30 June 2018, Afinitas reported a 65 percent jump in revenue to P6.8 million. But all that effort was quickly eroded by the ever rising expenditure which increased 35 percent to P12.2 million. In the end, Afinitas went down the familiar path of mounting losses, declaring P5.1 million in loss, a 15 percent increase from the previous corresponding period.
The company explained that the jump in expenditure was due to inclusion of a full six months operating expenses of EQOS, a subsidiary of Afinitas’s Ethiopia Investments Limited. Other costs were due to holding events and the legal costs associated with their new ventures.
Listed on the Botswana Stock Exchange in 2015 under the domestic venture capital counter, Afinitas has been reporting losses with the investment focused company pumping millions into new ventures. After raising money through listing, the company acquired a 50 percent shareholding in Africa Events Limited which entirely owns the rights to Africa Financial Services Investment Conference (AFSIC). In 2016 Afinitas followed with establishment of two new companies; Ethiopia Investments Limited and Adventis Limited, committing P50 million to the two ventures.
In the last annual general meeting of the company held this year in Gaborone, Afinitas directors said the company has successfully developed the necessary corporate structures, allowing the company to focus on revenue growth. In the past the company’s top honchos have defended reported losses as teething problems of a new start-up company, explaining that operating costs are going to exceed revenue generated due to investment in human resources and infrastructure at a time when revenue streams are not fully developed.