The investment holdings group plans to shift its focus to school fee income initiatives during 2022.
Trematon has seen an increase in its cash generation throughout most of its businesses for the year ended 31 August 2021, especially with the realisation of property assets at values at or above book values.
This is according to CFO Arthur Winkler, who says he is extremely proud of how all Trematon’s businesses have performed during the Covid-19 pandemic. “The main achievement has been the growth of our education business, Generation Education (GenEd), which continues to perform in line with expectations,” he says.
GenEd now comprises over 40 percent of Trematon’s value and is still in the growth phases.
Arthur adds that the group’s main revenue segments are property and rental income and school fee income. However, he explains that the contribution to revenue has decreased from property rentals and shifted to school fee income. “This is due to the sale of investment properties and increased student numbers.”
The acquisition of a new school in Somerset West, Cape Town, also contributed to the increase in school fee revenue.
“As is evident with our net sales of investment properties over the past 12 months and the growth in education-based investment within GenEd, we are likely to allocate a larger portion of cash-on-hand to GenEd as we feel the education market is where we would like to position ourselves in the near future,” Arthur says.
However, he adds that this does not mean Trematon is no longer investing into property assets or any other business opportunities that may present themselves, as the group is an investment holding company and investment offerings are always considered.
Trematon’s management also intends to address the issue of discount in its intrinsic value and share price, which isn’t unique to the group and is currently being experienced by all investment companies. “This is evident by our current share buy-back programme, as well as our return of capital to shareholders which increased by 300 percent in the current year,” Arthur says.
Trematon declared a distribution of 30 cents per share, up from 7.5 cents per share in the previous year.
“We are always striving to improve on our results and increase value for shareholders, with the main focus on increasing our education offering with our current bricks-and-mortar schools as well as our new ventures, which will focus on the digital and online schooling markets,” Arthur explains.
He adds that group operating expenses are always a focus point to ensure the group maintains and improves on profit margins.
