FINANCIAL PERFORMANCE
The Group’s financial results for the 2014/2015 financial year reflect
a profit after tax of R247 million in comparison with the previous
year’s profit after tax of R251 million. Profit from continuing
operations shows a profit after tax of R297 million.
The increase of 77% in normalised headline earnings per share
(normalised HEPS) can mainly be attributed to a good grain year
and a consequent rise in silo operations income as well as more
efficiency regarding operational and administrative expenses.
The low grain prices until December as well as the drought that
prevailed during the second part of the year, dampened the
increase in normalised HEPS.
Senwes managed to maintain its own capital ratio at 38%, which
is within the capital maintenance guidelines. Unutilised short-term
facilities as at 30 April 2015 amount to R979 million, which provides
enough liquidity for future growth.
The following are key financial ratios:
• A 77% growth in normalised HEPS, from 99 cents per share to
175 cents per share.
• Diluted headline earnings increased by 74% to 164 cents
from 94 cents last year.
• Earnings per share is 0,4% lower than the previous year.
• Return on opening equity of 15%.
• An increase in net asset value of 97 cents per share.
• Dividend yield of 4,7% on opening market price, which
represents a dividend of 50 cents per share.
• Total shareholders’ return (capital growth + dividends) of
R226 million was generated for the shareholders during the
year under review.
TARGET SETTING AND
MONITORING
RETURN ON EQUITY TARGET
The Group’s return target is dependent on the composition of the
portfolio. The current business portfolio is estimated as having a
total return on equity potential of the ten year risk free rate (R186)
plus market premium over a business cycle. For the financial year
the set target was 13,58%.
The actual return on equity amounted to 15% in 2015. The higher
than targeted return on equity for 2015 reflects the improved
earnings trend from business activities. An average return on
equity of 19% was achieved over the last five years.
22.30
24
18
12
15.00
13.58
10.89
13.17 12.25 12.64
2013 2012 2011
0
2015
2014
Return on equity
Targeted ROE
OWN CAPITAL RATIO TARGET
An important part of Senwes’ strategic platform is to maintain a
stable financial base, which provides better scope for strategic
choices in response to external challenges. Senwes uses the
own capital ratio to measure its financial stability irrespective of
the growth in the asset base. Senwes’ own capital target band
is between 35% and 45% of total assets, which reflects Senwes’
desired financial risk profile and the Board’s view of long-term
financial stability.
The equity ratio was 38% as at 30 April 2015, which is 2% lower
than in 2014. The marginal decrease was due to the increase
business assets which form the basis of operational activities.
50%
45%
40%
38%
40%
40%
41%
40%
35%
30%
2015
Targeted band
Senwes INTEGRATED REPORT 2015
20.70
15.70
2014
2013
Own capital to total assets ratio
22
21.25
2012
2011