Sasfin reports a 58.75 percent growth in half-year headline earnings

Group FD Angela Pillay says she is fortunate to be able to tell a good news story.

Sasfin has announced its half-year results for 31 December 2018, with a 59.89 percent growth in headline earnings to R80.531 million. 

The financial services company also reported an increase in headline earnings per share of 58.75 percent to 250.12 cents. 

Group FD Angela Pillay (pictured) accredits the growth to an improved credit loss ratio to 123bps and a normalisation of the tax expense to R30.344 million. 

I am fortunate that I have the opportunity to give a good news story,” she says. “Earnings are up, even if off a low base, and the team has put in a lot of effort in key elements of the business to make sure that it’s working for us.”

She adds that it’s been a hard year for her, as her first year at Sasfin. “I’ll have done 12 months in March, and I came in and we pulled together the year-end numbers in September, and now the December numbers. It’s been hard work, with new auditors and a new financial director learning about Sasfin at the same time.” 

The group’s total income grew by 5/78 percent in a subdued economy. 

Sasfin CEO Michael Sasson said: 

“Sasfin is starting to reap the fruits of the significant strategic steps it has taken over the last two years including strengthening the management team, enhancing our credit function and investing in technology.” 

The group has taken meaningful strides in terms of its three-pronged strategy in respect of innovation, namely to build, invest and collaborate.

These steps include the upgrade of its digital wealth and business banking platforms, Sasfin Wealth Investment Platform (SWIP) and B\YOND, as well as having concluded strategic deals with digital finance fintech Payabill and powering Hello Paisa’s new digital banking offering to the unbanked and underserved. Sasfin has also invested in Absa Technology Finance Solutions (ATFS). 

The strategic steps saw costs grow by 12.31 percent. The group’s cost-to-income ratio deteriorated to 73.96 percent. 

The release said that cost growth is expected to reduce by year end. 

Other highlights: 

  • Total assets grew by 3.14 percent to R13.572 billion
  • Gross loans and advances grew by 8.72 percent (largely off the back of the ATFS acquisition
  • Funding grew by 7.8 percent to R9.911 billion
  • Healthy cash position of R1.113 billion
  • Near cash in the form of negotiable securities grew by 71.02 percent to E1.762 billion
  • Increase in profit tax to R58.108 million
  • The gross loans and advances book grew by 9.95 percent to R7.339 billion
  • The Wealth Pillar showed an 8.31 percent growth in profit after tax to R25.780 million 

Michael said: 

“Sasfin has recovered well after the disappointed performance in the previous year. While the economy remains challenging, we are confident that we are continuously improving our offering to ensure that we deliver value to our primary client segments. Our future success will be underpinned by our ability to generate top line growth through growing our client base while stabilising costs and managing credit risk.” 

He says that Sasfin will continue to enhance its value propositions and distribution capabilities to its five primary client segments – small business, medium business, asset suppliers, private clients and institutional clients. 

“This includes growing our fintech capabilities; incorporating credit and forex capabilities into our B\YOND platform; ensuring cash flow support for medium sized businesses through asset finance; further growing clients’ global wealth and taking advantage of our strong position to grow institutional assets under management,” Michael concluded.