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Amid operating difficulties, Shameel Joosub-led Vodacom Group reports decline in profit in H1 2021

Vodacom Group is a South African telecom company, providing voice, messaging, data and converged services.

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South African businessman Shameel Joosub.

South African telecommunications company, Vodacom Group, has posted a 4.3-percent decline in profit for the first half of its 2021 financial year, which ended on Sept. 30.

Figures contained in the telecom group’s latest filings revealed that its profit for the period fell to R8.87 billion ($584 million) in the first-half-year period from R9.27 billion ($610.2 million) during the same period last year, while revenue surged from R47.84 billion ($3.14 billion) to N49.9 billion ($3.28 billion).

The group’s first-half-year profit was pressured by difficulties in its operating environment, which resulted in a surge in indirect expenses. Tis was further compounded by an increase in operating costs.

Vodacom Group Limited is a South African telecommunications company, providing voice, messaging, data and converged services to more than 129.9 million customers.

The group has grown its operations to include networks in Tanzania, Democratic Republic of Congo, Mozambique and Lesotho.

In addition to its core telecom operations, Vodacom provides business services to customers in over 32 African countries, including Nigeria, Zambia, Angola, Kenya, Ghana, Cote d’Ivoire and Cameroon.

Its M-Pesa platform, including Safaricom, processed $301.9 billion in transaction value in the past 12 months.

Shameel Joosub, the CEO of Vodacom Group, said the group delivered resilient half-year results despite the disruptions and difficulties that it experienced in its operating environment.

Joosub noted that Vodacom Group’s decision to diversify its geographic exposure continues to pay dividends. He explained that its strategic investment in Kenya’s Safaricom in 2017 has proven to be value accretive, generating an annual total shareholder return of 26 percent.

The group recently announced two transformative acquisitions to further enhance its penetration in Africa, as well as its growth and return to shareholders. 

In Egypt, the leading South African telecom operator acquired a 55-percent controlling stake in Vodafone Egypt, a clear market leader with a track record of strong growth and attractive returns.

In addition, the group agreed to acquire a strategic stake in Community Investment Ventures Holdings (CIVH), a holding majority owned by South African billionaire Johann Rupert’s Remgro Limited.

The deal will see Vodacom partner with Remgro through CIVH. The South African telecom company will inject R6 billion ($390.4 million) into the new entity and sell its fiber business to CIVH at a valuation of R4.2 billion ($275.9 million) in return for new shares.

Despite a single-digit reduction in its first-half-year profit, the board declared an interim dividend of R4.2 ($0.276) per share payable to shareholders on Dec. 3. The interim dividend is 1.2-percent higher than what investors received last year.

As of press time, Nov. 15, shares in Vodacom Group were trading at R137.96 ($9.0597), 1.53-percent lower than its market opening price.

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Financial services firm linked to Egypt’s Sawiris family suffers over $12 million in losses in H1 2022

OFH was founded in 1997 by the late Onsi Sawiris, a member of Egypt’s billionaire Sawiris family.

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Naguib Sawiris.

Orascom Financial Holding (OFH), a technology-driven financial services investment company led by the Sawiris family, reported losses in excess of $12 million at the end of the first half of 2022, owing to rising operating expenses.

Founded in 1997 by the late Onsi Sawiris, a member of Egypt’s billionaire Sawiris family, and led by his son Naguib Sawiris, OFH incurred standalone net losses of EGP234.45 million ($12.23 million) in the first half of 2022, compared to net profits of EGP 55.17 million ($2.87 million) in the same period in 2021.

Its financial performance in the six months ending June 30 was hampered by a loss of EGP320.5 million ($16.75 million) in the second quarter. The news comes after the group reported a consolidated net profit of EGP27.43 million ($1.43 million) in the first three months of 2022.

Despite a 30.8-percent increase in revenue from EGP57.9 million ($3.02 million) to EGP75.75 million ($3.96 million), the group was in the red at the end of the first six months of its 2022 fiscal year due to a surge in operating expenses.

This represents a decline from the EGP27.43 million ($1.43 million) in profit reported in the first three months of the year.

Despite its poor financial performance in the first half of 2022, its shares on the Egyptian Stock Exchange were slightly higher at EGP0.19 ($0.0099) per share, up from an opening price of EGP0.18 ($0.0094) per share earlier this month.

OFH’s share price has fallen from EGP0.23 ($0.012) to EGP0.19 ($0.0099) since the start of the year, bringing its market capitalization on the local bourse below EGP1 billion ($52.3 million), while the Sawiris family’s 51.6-percent stake in the group is valued at EGP510 million ($26.66 million).

OFH sold a portion of its holdings in one of its subsidiaries, Beltone Financial Holding, to Chimera Investment, an Abu Dhabi-based firm led by Pakistani businessman Syed Basar Shueb, as part of its efforts to exit its recent loss position.

It is unclear how much of OFH’s 59.22-percent stake was acquired during the share-purchase transaction.

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Aga Khan IV-backed Jubilee to receive $2.27 million from sale of Mauritian insurance subsidiary

Jubilee Holdings is a Kenyan investment holding company.

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Aga Khan IV.

Jubilee Holdings is on course to pocket a total of Ksh270 million ($2.26 million) from the sale of a 54.15-percent stake in its Mauritian subsidiary Jubilee Insurance Company of Mauritius Limited to Allianz SE.

Alliansz SE is a German multinational financial services company headquartered in Munich.

The transaction is the fifth to be concluded under a 2020 agreement in which Allianz began the process of purchasing majority stakes in Jubilee’s general insurance units in five countries, including Mauritius.

“We expect to close the Mauritius transaction in September… For Jubilee, the total consideration is Sh270 million,” Nizar Juma, chairman of Jubilee Holdings, said, setting the timeline for the $2.26-million deal with the German multinational insurer.

Jubilee Holdings is a Kenyan investment holding company with active operations and investments in Kenya, Uganda, Tanzania, Burundi, and Mauritius. It owns 88.15 percent of Jubilee Insurance Company of Mauritius Limited.

Shah Karim al-Husayni, also known as Aga Khan IV, is best known for founding Nation Media Group, Africa’s largest independent media organization. Through the Aga Khan Fund for Economic Development, he owns 37.98 percent of Jubilee Holdings and 11.85 percent of its Mauritian subsidiary.

According to BusinessDaily, Allianz will purchase additional shares from Aga Khan IV, who will sell his 11.85-percent stake in the Mauritian subsidiary as part of the deal.

With the deal expected to close next month, Jubilee Holdings will see its ownership interest drop to 34 percent as part of its partial divestiture in its general insurance businesses, which follows the sale of similar assets in Kenya, Uganda, Tanzania, and Burundi.

Over two months ago, Jubilee received Ksh1.4 billion ($11.7 million) from the sale of a majority stake in its Tanzanian general insurance business to Allianz.

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Nigerian billionaire Femi Otedola gains $12.7 million from stake in FBNH

FBNH is one of Nigeria’s largest financial services conglomerates.

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Femi Otedola. ©Billionaires.Africa

Nigerian billionaire Femi Otedola’s stake in the country’s oldest commercial bank, First Bank of Nigeria Holdings Plc (FBNH), has risen by more than $12 million in recent months, as shares in the financial services group rebounded strongly after falling below key levels.

According to data tracked by Billionaires.Africa, Otedola’s stake in FBNH has increased in value by N5.34 billion ($12.7 million) in the past 54 days, as investors continued to cherry-pick stakes in the commercial banking group after its price fell below N9 ($0.0214) in June.

FBNH is one of Nigeria’s largest financial services conglomerates. It is the non-operating holding company of First Bank of Nigeria Limited, the country’s oldest commercial bank, with active operations in 10 countries.

According to a flurry of trading updates published on the Nigerian Stock Exchange in June, Otedola sold 664,939,764 shares in four separate transactions, reducing his stake in the Nigerian lender from 2,717,282,140 shares, or 7.57 percent, to 2,052,342,376 shares, or 5.72 percent.

Shares in the financial group have increased by 31 percent since June 21, nearly 54 days ago, from N8.4 ($0.02) to N11 ($0.026) at the time of writing, amid renewed buying interest in the bank’s shares on the local bourse.

As a result of the double-digit increase in the shares of FBNH, the market value of Otedola’s 5.72 percent stake in FBNH has increased by N5.34 billion ($12.73 million), from N17.24 billion ($41.12 million) on June 21 to N22.58 billion ($53.85 million) at the time of writing this report.

The recent gains in his stake follow a dividend of N951.05 million ($2.29 million) from his equity stake in the financial services group that he received earlier this year.

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