CHAMWE KAIRA
Nictus Holdings Limited has disclosed that the first six months of the 2023 financial year, the group exceeded profits of the comparative period by 57%.
The group said even within the high inflationary and interest rate environment, the group was able to increase retail sales and it is expected that retail sales continue on this trend. The insurance segment also exceeded premium expectations for the first six months of the year and will continue to do so.
“The import strategies of the Group play a major role in the success achieved and will continue to do so in the future. Uncertainty in terms of the exchange rates and transport cost could however negatively impact the profitability of the group,” Nictus said.
Financial results for the six months ended 31 December 2023 showed that profit for the period was N$25 million compared to N$16 million during the same period in 2022. Revenue for the period was N$472 million compared to N$447 million in 2022.
The retail segment was able to increase revenue for the comparative period with 4% relative to the comparative period. Gross profit increased by 44% in the same period, Nictus said.
Nictus said this result was achieved by increasing gross profit percentages on selected product ranges as well as managing costs effectively.
“Vehicle sales were under pressure in the first six months due to high interest rates, but furniture and tyre sales were better than expected.”
Rental income increased with 13% compared to the prior period. The segment made a small loss for the six months with increased financing costs being the main driver of the loss incurred. The insurance segment has shown an 80% increase in revenue and 28% increase in profitability.
“Investment income achieved in the first six months was good and the increased focus on optimising investment income is showing the desired results,” the company said.
In terms of investment properties and land and buildings, the board of directors assessed the values of the land and buildings at 31 December 2023 and no fair value adjustments have been proposed. The fair values are based on valuations and other market information that take into consideration the estimated rental value (40%) and replacement value (60%) of the property.
Nictus said a market yield between 11.5% and 12.5% (2023: between 11.5% and 12.5%) was applied to the estimated rental value to arrive at the gross property valuation.
Meanwhile, the company has informed shareholders that it has entered into a sale of shares agreement with one of its wholly-owned subsidiaries, Corporate Guarantee and Insurance Company of Namibia Ltd for the sale of all of the issued shares held by the company in another wholly-owned subsidiary, Bonsai Investments Nineteen to CG.
By purchasing Bonsai, CG will improve its investment diversification, which may be particularly beneficial in current and expected economic conditions to further stabilize income-earning potential in volatile economic conditions, it said.
