African Rainbow Capital Investments Limited (ARC Investments) has announced its full-year financial results for the twelve-month period ending on June 30, 2023, showcasing remarkable resilience in the face of a challenging economic environment.
In a tough macroeconomic landscape that exerted pressure on the economy and consumers, ARC Investments displayed impressive financial performance. The intrinsic net asset value (INAV) increased by a significant 15.8%, reaching R15,328 million, up from R13,242 million in the previous year. This notable growth reflects the strength of the company’s diverse portfolio.
Moreover, INAV per share witnessed a substantial increase of 13.4%, reaching R11.41 per share. Despite a 25% decrease in cash within the ARC Fund, which amounted to R500 million, and a 51% increase in debt, which reached R1,473 million, ARC Investments managed to navigate the challenges effectively.
ARC Investments’ portfolio includes a range of companies across various sectors. Notable advancements were reported in several of its large early-stage portfolio companies:
ARC Investments has implemented several initiatives to bolster its portfolio’s performance:
The company’s revised strategy involves disposing of smaller and non-core assets while increasing its exposure to future-focused growth areas in Financial Services, Telecommunication, Agriculture, and “Diversified financials.”
The newly approved performance participation fee structure allows shareholders to share in 16% of the growth in ARCI NAV above the 10% hurdle. For the year ending June 30, 2023, a provisional performance amount of R122 million was recognized, a substantial saving for investors compared to the previous year’s R273 million.
ARC Investments remains committed to its strategic direction, with a focus on delivering value to its shareholders. The company continues to explore opportunities in various sectors to strengthen its portfolio and ensure long-term growth.
ARC Investments’ resilience and strategic manoeuvring have resulted in strong financial performance despite challenging economic conditions. The company’s diverse portfolio, focus on future-focused sectors, and cost-saving initiatives have positioned it for continued success in the years ahead. Shareholders can look forward to sustained growth and value creation.
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