Wednesday, May 22, 2024

Late disposal of stockbroker hits Imara bottom line

The sale of Imara Holdings Limited’s stockbroking unit in South Africa was meant to be a boon for shareholders, but it has turned to disappointment as the group expects to report a loss when it releases its full year results. The Botswana Stock Exchange (BSE) quoted pan African investment banking group said in a cautionary that it anticipates its financial results for the financial year ending 30 April 2015 to reflect a loss as opposed to the profit reported in the financial year ended 30 April 2014. For the year ended 30 April 2014 Imara reported a profit after tax of P16 081 427.

The explanation given is that the sale of Imara S.P. Reid Proprietary Limited to MMI Strategic Investments Proprietary Limited was not concluded in time, and the revenue earned from the sale will not be reflected on the full year results.

“It had originally been anticipated that the disposal of the South African stockbroker Imara SP Reid Proprietary Limited, would be concluded before 30 April 2015 and that the profit from this disposal of approximately P76 million would be accounted for in the year ended 30 April 2015,” said the Botswana registered company.

“As detailed in the Announcement to Shareholders released on 16 June 2015, the effective date of disposal was 12 June 2015 and consequently the profit on disposal will now be accounted for in the April 2016 financial year.”

Last week, Imara announced it had concluded the disposal of Imara SP Reid following the sale to a Johannesburg based company for P100 million. The company said it decided to dispose the South African stockbroking unit on the back of an increase in online share trading, escalating regulatory and compliance costs, together with generally changing market dynamics that has led to growing pressure and competition for independent stockbroking companies in South Africa.

“Accordingly, shareholders are advised to exercise caution when dealing in the company’s securities, until such time as a full announcement of the April 2015 financial results is made,” advised the company.

Imara said further particulars and details will be provided in the announcement of results to shareholders, which is due to be published in late July 2015. Imara has presence in Angola, Botswana, Kenya, Malawi, Mauritius, Namibia, Nigeria, United Kingdom, Zambia and Zimbabwe.


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