Capricorn Group Limited Reports Strong Financial Performance in Interim Results

  • Capricorn Group Limited reports strong financial performance, with a 18.5% increase in profit after tax.
  • Implementation of IFRS 17 positively impacts profitability, contributing to a return on equity of 16.8%.
  • Despite economic challenges, the Group remains committed to sustained growth for the benefit of stakeholders.
Published by
Lethabo Ntsoane

Capricorn Group Limited has announced robust financial results for the six months ended December 31, 2023. The Group reported a significant increase in profit after tax, driven by growth in the loan book and increased transaction volumes, despite facing escalated credit impairment charges.

Financial Highlights

Capricorn Group achieved solid financial results, with profit after tax rising by 18.5% to N$ 827.6 million compared to N$698.2 million in the same period last year. Earnings per share (EPS) increased by 19.4% to 152.4 cents, demonstrating the Group’s strong performance. The return on equity (ROE) increased from 16.6% to 16.8% year-on-year, highlighting the Group’s efficiency in generating returns for shareholders.

Metric6 months ended 31 Dec 2023 (N$’000)6 months ended 31 Dec 2022 (restated)* (N$’000)
Operating profit999 743899 397
Profit after tax827 644769 781
Basic earnings per share (cents)152.4142.1
Fully diluted earnings per share (cents)151.5141.6
Headline earnings per share (cents)152.4142.1
Net asset value per share (cents)1 7861 561
Interim Dividend per share (cents)4839
Total risk-based capital adequacy ratio (%)17.616.6

Impact of IFRS 17

The Group’s profitability was further enhanced by the implementation of IFRS 17 – “Insurance Contracts,” resulting in reduced discretionary policyholder reserves. Excluding the positive impact of IFRS 17, the Group’s return on equity would have been 17.3% for the period.

Dividend Declaration

Capricorn Group declared an interim dividend of 48 cents per ordinary share for the six months ended December 31, 2023. The dividend will be payable on April 5, 2024, to shareholders on record as of March 22, 2024.

Economic Outlook

Despite challenges such as weakened global demand and an expected contraction in the agriculture sector, the central banks of Namibia and Botswana have adopted prudent monetary policies to counteract inflationary pressures. The Bank of Namibia’s Economic Outlook for December 2023 predicts a deceleration in economic growth, with real GDP growth rates of 3.9%, 3.4%, and 3.1% for the years 2023, 2024, and 2025, respectively.

Future Prospects

Capricorn Group remains committed to sustained growth for the benefit of all stakeholders. The Group’s strong financial performance reflects its resilience and strategic focus amid challenging market conditions. Shareholders can access the full interim results announcement on the Group’s website or via the Namibian Stock Exchange link.

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Lethabo Ntsoane

Lethabo Ntsoane holds a Bachelors Degree in Accounting from the University of South Africa. He is a Financial Product commentator at Rateweb. He is an expect financial product analyst with years of experience in reviewing products and offering commentary. Lethabo majors in financial news, reviews and financial tips. He can be contacted: Email: lethabo@rateweb.co.za Twitter: @NtsoaneLethabo