CHAMWE KAIRA
Nictus Limited, which has operations in Namibia, has said in condensed consolidated interim financial statements for the six months ended 30 September that profit for the period increased to N$13,8 million (2023: N$3,7 million).
The firm said basic earnings per share of 25.79 cents (2023: basic earnings per share of 6,93 cents) and headline earnings per share of 26,51 cents (2023: headline earnings per share of 6.94 cents).
“No interim dividend was declared for the current nor comparative prior period. The board declared a final gross cash dividend of 6 cents per ordinary share for the year ended 31 March 2024,” the company said.
Nictus said the retail industry, specifically for high-value durable goods, has been negatively affected by the fact that consumers remain under pressure due to the struggling local economy with persistent and increasing levels of sustained unemployment.
“Towards the end of the reporting period, the interest rate decreased by 25 basis points, bringing the prime interest rate to 11,50%. There has been a marked deterioration of basic infrastructure, like roads and water provisioning, specifically in the locations where the segment operates.”
Nictus said the compounding effects of these factors have suppressed consumer demand, which negatively impacted the segment performance.
“Total revenue of Nictus Meubels Proprietary Limited did decline. The segment result was negatively impacted by the once-off derecognition of the segment deferred tax asset amounting to N$0,9 million, in conformity with the prescribed IFRS recognition and re-evaluation requirements.”
The firm said the improved profitability during the reporting period was caused by, among other contributing factors, increased new premiums.
“The prudent and conservative investment methodology followed, together with the continued work by our external investment advisors, allowed the segment to successfully navigate an ever-changing and volatile investment environment. The segment generated competitive investment returns over the reporting period, on a risk-adjusted basis. A larger asset base also contributed to a material increase in investment income.”
On prospects, Nictus said it is fortunate to have a strong capital base to carry the group during times of uncertainty and adverse economic conditions.
“The group has no external debt financing. Although there is broader optimism about the potential for positive reforms after the formation of a Government of National Unity as a result of the May 2024 general elections, confirmation of additional growth-orientated policy changes and the tangible roll-out of structural reforms are yet to be proven.”
Nictus said the board is confident that despite the economic and environmental challenges within the South African economy, the group is positioned to build on the sustainable foundation that has been preserved over the years.
“The group will continue to invest for the future, to become a sought-after wealth creator for all stakeholders involved, in line with its set strategies and action plans.”
