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PSG GROUP'S PROFITS UP BY 28% IN TOUGH MARKET CONDITIONS

Release Date: 03/10/2000 17:52
Code(s): PSG
Wrap Text
PSG GROUP LIMITED

STELLENBOSCH - THE PSG GROUP REPORTED A SATISFACTORY 28% INCREASE IN
ATTRIBUTABLE PROFIT TO R97,9M IN THE SIX MONTHS TO 31 AUGUST 2000 DESPITE DEMANDING MARKET CONDITIONS IN THE FINANCIAL SERVICES SECTOR.
EARNINGS PER SHARE AMOUNTED TO 70,2 CENTS (1999: 57,1 CENTS) WHILE HEADLINE EARNINGS PER SHARE INCREASED BY 7,2% TO 61,2 CENTS. THE NET ASSET VALUE PER SHARE INCREASED BY 10% TO R8,52.
AN INTERIM DISTRIBUTION OF 14 CENTS PER SHARE (1999: 12 CENTS) WAS DECLARED. THE GROUP'S BALANCE SHEET INCLUDES INVESTMENTS IN LISTED SHARES WITH A BOOK VALUE OF R110M AND MARKET VALUE OF R152M AS AT 31 AUGUST 2000. EXCEPTIONAL ITEMS AMOUNTED TO R16,4M, REFLECTING THE PROFIT ON THE SALE OF PSG ANCHOR FINANCE AS WELL AS THE POSITIVE EFFECT OF THE CHANGES IN THE COMPANY'S SHAREHOLDINGS IN SUBSIDIARIES.
PSG CHAIRMAN JANNIE MOUTON SAID THE GROUP IS BUDGETING FOR FURTHER GROWTH DURING THE NEXT SIX MONTHS TO 28 FEBRUARY 2001, SUBJECT TO CURRENT MARKET CONDITIONS.
MOUTON ADDED, "WITH OUR STRONG AND COMMITTED MANAGEMENT TEAM AND WELL
CAPITALIZED COMPANIES PSG IS WELL PLACED TO TAKE ADVANTAGE OF SPECIAL SITUATIONS."
THE PSG GROUP SAID IN ITS DIVISIONAL REVIEW A NUMBER OF FACTORS INFLUENCED THE FINANCIAL MARKETS DURING THE FIRST HALF OF THE FINANCIAL YEAR, WHICH MADE BUSINESS, TRADING AND TREASURY CONDITIONS UNPREDICTABLE AND DIFFICULT. THE INCREASE IN EARNINGS OF 8% TO 8,1 CENTS PER SHARE OF PSG INVESTMENT BANK HOLDINGS CAN BE REGARDED AS FAIR UNDER THESE CONDITIONS. THE HEADLINE PROFITS INCREASED TO R105,3M (1999: R97,7M) WITH THE SHAREHOLDERS' FUNDS TOTALLING R1 683M.
NEW INITIATIVES INCLUDED THE ACQUISITION OF A 43% INTEREST IN VESTACOR, THE ACQUISITION OF THE BUSINESS BANK AND AN INTEREST IN A 'SMART CARD' BUSINESS. THE BUSINESS BANK IS EXPECTED TO CONTRIBUTE SIGNIFICANTLY TO THE RESULTS OF THE BANKING GROUP IN FUTURE. THE OTHER INITIATIVES ARE ALSO PERFORMING IN LINE WITH EXPECTATIONS.
"PSG INVESTMENT BANK IS WELL POSITIONED AND FOCUSED TO SUCCESSFULLY CONDUCT ITS OPERATIONS AND TO TAKE ADVANTAGE OF OPPORTUNITIES. EARNINGS FOR THE NEXT SIX MONTHS WILL REFLECT THE BANK'S STRATEGY AND ARE EXPECTED TO BE BETTER THAN THE MARKET," THE GROUP SAID.
REGARDING KEYNES RATIONAL THE GROUP SAID THEY ARE SATISFIED WITH ITS PROGRESS AND HAVE BUDGETED FOR SUBSTANTIAL GROWTH IN PROFITS FOR THE FORESEEABLE FUTURE. KEYNES RATIONAL'S HEADLINE EARNINGS FOR THE SIX MONTHS AMOUNTED TO R22,4M (1999: R12,4M). INCLUDED IN ATTRIBUTABLE EARNINGS OF R38,7 MILLION IS A CAPITAL PROFIT OF R18,3M THAT WAS REALISED WITH THE DISPOSAL OF PSG ANCHOR FINANCE (TERM-LOANS) WHEN IT WAS SOLD FOR A CASH CONSIDERATION OF R26M AND TOTAL LOANS OF R106M WERE REPAID.
KEYMATRIX (SHORT-TERM LOANS) HAS ACHIEVED ITS BUDGET AND WAS THE BIGGEST CONTRIBUTOR TO HEADLINE EARNINGS WITH R11,8M DURING THE PAST SIX MONTHS. THE BUSINESS HAS ALMOST DOUBLED IN SIZE WITH LOANS AND ADVANCES NOW AT R56,9M COMPARED TO R33,9M AT YEAR-END.
"THE NEXT GOAL FOR KEYMATRIX IS TO BECOME A DEPOSIT TAKING INSTITUTION AND THIS PROCESS IS WELL UNDER WAY. WITH THE ADDITION OF A TEAM OF EXPERIENCED SENIOR EXECUTIVES THE COMPANY'S MANAGEMENT IS OF SUFFICIENT STRENGTH TO COPE WITH BOTH THE GROWTH AT KEYMATRIX AS WELL AS ESTABLISHING AND MANAGING A COMPANY THAT PROVIDES A RANGE OF FINANCIAL SERVICES," PSG SAID.
KEYNES RATIONAL HAS FURTHER DECIDED TO FOCUS ON THE OPPORTUNITIES WITHIN THE BANKING INDUSTRY ONLY, OF WHICH PSG ANCHOR LIFE DOES NOT FORM A PART. PSG CHANNEL HOLDINGS HAS OBTAINED THE LIFE ASSURANCE COMPANY.
PSG SAID THIS FINANCIAL YEAR HAS SEEN PSG INVESTMENT SERVICES TAKING
SIGNIFICANT STRIDES TOWARDS REALISING ITS STRATEGY OF BEING A LEADER IN THE SOUTH AFRICAN MARKET IN THE PROVISION OF PRIVATE CLIENT WEALTH MANAGEMENT SOLUTIONS.
AS A RESULT OF DIFFICULT TRADING CONDITIONS ATTRIBUTABLE EARNINGS FOR THE PERIOD UNDER REVIEW DECLINED FROM R5,4M TO R5,1M. ITS PERFORMANCE WAS ALSO BELOW BUDGET.
TOTAL ASSETS UNDER MANAGEMENT REACHED R5,3BN WITH POSITIVE INFLOWS BEING ACHIEVED BY THE UNIT TRUST DIVISION AS A RESULT OF A STRONG SALES AND MARKETING FOCUS.
PSG'S INVESTMENTS IN THE INSTITUTIONAL MARKET PROVED TO BE VERY SUCCESSFUL, WITH A SIGNIFICANT IMPROVEMENT IN THE PERFORMANCE AND CONTRIBUTION OF PSG CHANNEL HOLDINGS. "WE ARE EXCITED ABOUT THE PROSPECTS OF THE CHANNEL GROUP AND EXPECT MAJOR GROWTH IN THIS DIVISION FOR THE FORESEEABLE FUTURE," THE GROUP SAID.
THE ESCHER GROUP WAS SUCCESSFULLY LISTED ON THE JSE IN JUNE 2000, RAISING R41,85 MILLION IN THE PROCESS. ESCHER'S CURRENT ASSETS UNDER MANAGEMENT ARE R13,6BN AND FURTHER GROWTH IS EXPECTED. ENDS
ISSUED BY INVESTOR CONNEXION ON BEHALF OF PSG GROUP ENQUIRIES JANNIE MOUTON CHAIRMAN PSG GROUP TEL: (021) 887 9602 FAX: (021) 887 9619 WEBSITE: WWW.PSG.CO.ZA GERHARD CLOETE INVESTOR CONNEXION TEL: (021) 797 3702 FAX: (021) 761 7702 CELL: 083 300 6850 E-MAIL: GERHARD@BJFCB.CO.ZA DATE: 3 OCTOBER 2000

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