Paratus doubles profits to N$29m
By Hilary Mare
FOR the 12 months ended 29 February 2020, Paratus Namibia Holdings delivered commendable revenue growth with net profit before tax jumping to N$29.9 million up from N$13.8 million in 2019 and turnover rising to N$323.7 million, 14 percent up from N$283.7 million in 2019.
Consequently, earnings before interest, tax, depreciation and amortisation (EBITDA) also went up 49 percent to N$78.8 million.
“EBITDA mirrors the company’s ability to generate cash flows from operations. The disparity between profit after taxation and EBITDA stems from the large depreciation charges recorded on infrastructure deployed.
“The growth in profitability is mainly attributable to the improved operating margins coming from the extensive infrastructure roll-out and once off revenue derived from Local Area Network (LAN) installations in new commercial buildings. During March 2020, the directors of Paratus Namibia Holdings approved an additional fiber roll-out project of N$60 million to expand the fiber network in Windhoek, Swakopmund and Walvis Bay. The directors are of the opinion that the continued investment in infrastructure assets bodes well for future revenue growth,” the company said in a Namibia Stock Exchange announcement last week.
On 25 September 2019, Paratus approved the implementation of the proposed share swap transaction, as a category 1 transaction together with an issue of new shares as consideration, in term s of the NSX listing requirements.
“Effective 1 January 2020, in terms of the swap, Paratus Namibia Holdings acquired 46 168 ordinary shares in Paratus Namibia, resulting in an increased effective shareholding of Paratus Namibia Holdings from 51.38 percent to 100 percent of the total issued ordinary shares in Paratus Namibia. From 1 January 2020 the financial results of Paratus Namibia are therefore consolidated into the Paratus Namibia Holdings financial results,” explained the company.
The swap consideration was settled through the issue of 20 012 431 new ordinary Paratus Namibia Holdings shares allotted to Paratus Group Holdings Ltd at a pre-determined and agreed upon price of N$10.50 each for a total consideration of N$210 130 525.50.
“After the 28 February 2020 interim financial reporting period, there has been a wide-spread international outbreak of the Covid-19 virus originating in China, which has significantly affected lives, entities and economic activity around the world. The Namibian Government implemented a national “lockdown” starting at midnight on 27 March 2020. As a result of the spread of the virus and the reactions thereto, there have been material adverse financial effects around the world,” Paratus further explained.
The directors declared a maiden dividend of 10c per ordinary share stating that a dividend policy was adopted that provides for a dividend pay-out of approximately 50 percent of profit after tax.