GAMBLING: GrandWest Parent Shows Slowdown
Recent Western Cape Business News
Black empowered investment company Grand Parade Investments (GPI) yesterday posted its preliminary results for the year ended 30 June 2009, showing a revenue decline.
According to chairman Hassen Adams: “The global economic slowdown has meant that GPI has been affected by declining levels of disposable income. However, given this environment, we are particularly pleased that we were able to grow our earnings and perhaps most importantly the reported value of GPI’s share,” he says.
“I believe that our results are a further reflection of GPI being firmly on the move in its quest to become a leading player in the gaming and leisure industry.” Adams added that what pleased him most was to “see the communities benefit from GPI’s investments, the most significant of which being GrandWest, which is making increasingly signficant contributions to society from a corporate social investment and enterprise development perspective.”
GPI’s Chief Executive, Adrian Funkey said that headline earnings increased 14% from R84.8 million to R96.7 million, while headline earnings per share decreased by 9.7% due to the increased weighted average number of shares in issue. Revenues dropped, mainly due to lower interest received as a result of lower average cash balances during the reporting period and lower revenues generated by Western Cape Manco, in which GPI shares a management fee.
“GPI’s share of associate income increased substantially this year. In the case of SunWest, this growth is attributed to its increased stake for the full year while profit from RAH has been accounted for the full current reporting period, compared to one month in the previous year.”
“Thuo WC performed well during the year, growing its revenues by 12%, although attributable profits declined slightly due to increased administration and personnel costs, as well as higher capital charges incurred on the introduction of new slot machines and the refurbishment of selected LPM sites. The increase in earnings from Akhona GPI is due to accounting for a full year of earnings together with the increase in GPI’s economic stake from 50% to 75% for six months of the year.
The fact that we have been able to keep our operating costs lower than last year’s costs despite the additional demands associated with being a listed company with a larger portfolio of investments, is also pleasing and reflects GPI’s search for excellence through increasing levels of efficiency and effectiveness.”
“We are confident that our increased exposure to carefully chosen urban casinos and the LPM industry positions GPI well for growth when the economy turns, which it must inevitably do.”
“We have an exceptional balance sheet with low levels of debt, which is a good position to be in, particularly in this pressing economic environment.”
“GPI will continue to take a medium to long term view in expanding its portfolio, taking advantage of strategic investment opportunities which present themselves, as several have this past year. We’re able to be selective about what we choose to invest in, which puts us in a competitive situation. We look forward to the next financial year and the countdown to the 2010 Soccer World Cup, which we are sure will act as a boost to our investments in the hotel and leisure sector.”
“Our strategy is to provide stable and sustainable performance for our shareholders: we will continue to invest in companies and ventures where GPI can exercise significant influence and which are strongly cash generative.
“GPI’s long term, prospects remain exceptionally positive. We have a stable of great investments with upside potential and a number of opportunities which have presented themselves. We’re in the perfect position to take advantage of these and to continue to generate cash from our current investments to the benefit of all our shareholders”, said Funkey.
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