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Trading Statement For The 6 Months Ended 28 February 2023
TRUSTCO GROUP HOLDINGS LIMITED
Incorporated in the Republic of Namibia
(Registration number 2003/058)
Registered as an external company in South Africa
(External registration number 2009/002634/10)
NSX share code: TUC
JSE share code: TTO
OTCQX share code: TSCHY
ISIN Number: NA000A0RF067
(“Trustco” or “the Group”)
TRADING STATEMENT FOR THE 6 MONTHS ENDED 28 FEBRUARY 2023
1. Introduction
1.1 Trustco shareholders (“Shareholders”) are advised that the Group is finalising its
unaudited Interim Financial Statements for the 6-month period ended 28 February
2023 (“2023 Interim Results”).
1.2 In terms section 3.4(b) of the Listings Requirements ("LR") of JSE Limited ("JSE"),
companies are required to publish a trading statement as soon as they become
reasonably certain that the financial results for the period to be reported on will differ
by more than 20% from that of the previous corresponding period.
1.3 In this regard, comparisons for purposes of this trading statement are made against
Trustco’s restated results for the 6-month period ended 28 February 2022 (“2022
Restated Interim Results”).
1.4 With effect from 1 September 2021, the Trustco Group, in consultation with its
professional advisors, concluded that it had to comply with the exception of IFRS 10
(International Financial Reporting Standards), whereby investment entities are
exempted from financial consolidation. This has resulted in Trustco Group as an entity
having to value its portfolio of investments in terms of IFRS 13.
2. Trading Statement
Accordingly, a review by management of the financial results for the 2023 Interim Results
has indicated that Trustco expects to report:
2.1 Net Asset Value per share (“NAVPS”) for the 2023 Interim Results of between 143
and 179 cents per share, or a decrease of between 0.81% and 20.81%, compared to
the NAVPS of 180 cents in respect of the 2022 Restated Interim Results;
2.2 Basic loss per share (“LPS”) for the 2023 Interim Results of between (11.57) and
(39.19) cents per share, or a decrease of between 108.38% and 128.38%, compared
to the earnings per share (“EPS”) of 138.07 cents reported on in respect of the 2022
Restated Interim Results; and
2.3 Headline loss per share (“HLPS”) for the 2023 Interim Results of between (5.06) and
(45.70) cents per share, or a decrease of between 77.51% and 97.51%, compared to
the headline loss per share of (203.16) cents in respect of the 2022 Restated Interim
Results.
2.4 The financial information of this trading statement has not been reviewed or reported
on by Trustco’s auditors.
3. Key Factors
3.1 Trustco is a diversified investment entity based in Windhoek, Namibia, with its
investment focus on the insurance, education, real estate, resources as well as
banking and finance sectors. The company's investment portfolio has shown
exceptional returns historically, with an asset mix weighted 25% on average towards
US Dollar assets, with the remaining 75% in Namibia Dollar assets.
3.2 During the period under review, the Namibian economy faced a mixed economic
situation. Despite experiencing strong growth with an overall GDP growth of 3.5% in
2022, the country also faced headwinds due to the ongoing war in Ukraine, which
had a negative impact on the global economy. Namibia's economy was affected by
higher energy prices and supply chain disruptions, resulting in increased inflation
levels, which rose to their highest level in years.
3.3 Notwithstanding these challenges, the Namibian economy is expected to continue to
grow in 2023, with the IMF projecting a GDP growth of 2.8%. Namibia also benefits
from a stable political environment, with a history of democracy, and a government
that is committed to economic growth and development. With ongoing reforms and
continued growth, the country's economy is expected to become more stable and
prosperous, providing a favourable environment for Trustco to operate for years to
come.
3.4 Trustco's resources portfolio has experienced a decrease in valuation due to the
dilution of its shareholding, but this was partially offset by a depreciation in the
Namibia Dollar to US Dollar exchange rate. Currently valued at transaction value, this
portfolio is expected to see a revaluation via the income approach once it transitions
into commercial production. This revaluation is expected to offset the current dilution
effect and contribute to the overall growth of the portfolio.
3.5 In Trustco’s banking and finance, insurance and education portfolios, the discount
rates decreased due to lower risk profiles and higher income as a result of a higher
interest rate environment. This resulted in enhancing its underlying cash flow
forecasts, as interest rate expectations soared. Overall, this has positively impacted
the financial services portfolio.
3.6 Trustco's property portfolio was impacted by increased inflation on the cost side of its
valuation cash flow forecasts. This has resulted in decreased margins, as well as an
increase in funding costs for new developments. Despite these challenges, the
company remains committed to maintaining its strong position in the financial services
industry and continues to work towards enhancing its property portfolio to improve its
overall financial performance.
3.7 The board remains optimistic about the growth prospects of Trustco, given the
expected positive development of investment returns. Moreover, Namibia's economic
prospects show favourable conditions for investment and growth. Overall, Trustco is
well- positioned to take advantage of these conditions to continue to achieve positive
investment returns in the future.
4. Restatement
4.1 The 2022 Restated Interim Results have been restated as a result of corrective
actions as instructed by the JSE proactive monitoring. Refer to note 43 of the 2022
integrated annual report and audited financial statements for background information
on the JSE proactive monitoring restatement.
4.2 After incorporating the restatements above, the weighted average number of ordinary
shares in issue for the 2022 Restated Interim Results as well as the 2023 Interim
Results amounted to 985 310 288.
5. Conclusion
5.1 Trustco expects to release its 2023 Interim Results on or about Wednesday the 31st
of May 2023.
5.2 The financial information on which this trading statement has been based has not
been reviewed or reported on by Trustco’s auditors.
Windhoek, Namibia,
30 May 2023
Komada Holdings (Pty) Ltd
Company Secretary and Investor Relations Services to Trustco Group Holdings
Limited
JSE Sponsor
Vunani Sponsors
NSX Sponsor
Simonis Storm Securities Proprietary Limited – Windhoek
OTCQX Sponsor
J.P Galda & Co – New York
Date: 30-05-2023 05:15:00
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