The chairman of Trustco Group Holdings, Raymond Heathcote (left), and Quinton van Rooyen, the managing director of the group.
Photo Trustco Group Holdings
The chairman of Trustco Group Holdings, Raymond Heathcote (left), and Quinton van Rooyen, the managing director of the group. Photo Trustco Group Holdings

Trustco suffers gross loss of nearly N$1.7 bn

Jo-Maré Duddy
Trustco Group Holdings in a media on Tuesday bragged about a 257%-increase in its profit after tax for its past financial year, while in its annual integrated report (AIR), both the group’s board of directors and its independent auditors warned that a material uncertainty exists that may cast significant doubt on the group and company’s ability to continue as a going concern.

The Namibian-based group, which share trading was suspended on the JSE late last year, reported a gross loss of nearly N$1.7 billion for the 12 months ended 31 August 2022.

A gain of N$3.36 billion on “deemed disposal of subsidiaries” reported in the income statement, turned the Trustco ship around to report a net profit of about N$1.4 billion for the year – an year-on-year (y/y) improvement of 257% on the loss of N$917 million reported for the restated 11 months ended 31 August 2021.

“Trustco has completed its first year of reporting as an investment entity under IFRS 10, providing its co-investors with transparency into the fair value of its underlying investments,” group managing director Quinton van Rooyen said in the media statement.

Auditors, board

In the financial notes in Trustco’s AIR, its independent auditors, Nexia SAB&T, said the group and company’s current liabilities exceeded its current assets by N$570 million and N$454 million, respectively.

Total assets, however, exceeded total liabilities by N$1.834 billion and N$1.96 billion, respectively.

Also in the AIR, Trustco’s board of directors said it assessed the group’s prospects as a going concern.

As part of their assessment, the board of directors considered working capital requirements, availability of resources and reserves either from existing operational activities or further borrowings, available information about the future, financial impact of ongoing litigation, the possible outcomes of planned events and the responses to such events and conditions that would be available to the board.

“Following the above assessment, the board of directors believe that the above factors, coupled with prevailing economic conditions and forecast economic outlook presents some challenges for the foreseeable future,” it said.

To address future cash flow requirements, detailed liquidity improvement initiatives have been developed and are being pursued, with the implementation thereof regularly monitored, the board continued.

Restatement

Trustco in November agreed to restate its group annual financial statements for the year ending 31 March 2019, as well as its interim results for the six months ending 31 August 2018 after a protracted legal battle with the JSE and the Financial Services Tribunal in South Africa.

In its press statement on Tuesday, Trustco said restatements were made.

These include reversing shares issued to Next and its associates with a current market value of N$258 million in the 2020 reporting period in terms of the earnout mechanism of the Huso Transaction, the reinstatement of loans of N$1.5 billion in favour of Next, and Next’s entitlement to a payment of N$2.9 billion if the earnout targets of the Huso transaction are met before 2028.

“The restatements relate to financial reporting periods before the current period and affect the financial position and associated financial performance for the periods ending 31 March 2019, 30 September 2020, and 31 August 2021,” Trustco said.

Appeal

However, the group chairman Raymond Heathcote said the board yesterday petitioned the Supreme Court of Appeal and “may revisit the issues should they succeed on appeal”.

“The act of a regulator instructing an independent board to restate its financials in a way that results in an increase in the company’s liability on its balance sheet by N$1.5 billion is unfair and unjust.

“No regulatory authority should have complete autonomy to make such decisions without proper checks and balances in place,” Heathcote said.

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Namibian Sun 2024-04-25

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Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 325.38/OZ UP +0.39% | Copper US$ 4.50/lb UP +1.52% | Zinc US$ 2 857.40/T UP 1.8% | Brent Crude Oil US$ 87.95/BBP DOWN -0.0005 | Platinum US$ 904.66/OZ UP +0.28% Sport results: Premier League: Manchester United 4 vs 2 Sheffield United | Everton 2 vs 0 Liverpool | Crystal Palace 2 vs 0 Newcastle | Wolves 0 vs 1 Bournemouth | Arsenal 5 vs 0 Chelsea LaLiga: Sevilla 2 vs 1 Mallorca SerieA: AC Milan 1 vs 2 Inter Milan | AS Roma 1 vs 3 Bologna European Championships Qualifying: Coventry City 2 vs 3 Hull City | Leicester City 5 vs 0 Southampton | Middlesbrough 3 vs 4 Leeds United English Championship: Coventry City 2 vs 3 Hull City | Leicester City 5 vs 0 Southampton | Middlesbrough 3 vs 4 Leeds United Weather: Katima Mulilo: 15° | 34° Rundu: 15° | 34° Eenhana: 15° | 35° Oshakati: 17° | 34° Ruacana: 17° | 35° Tsumeb: 18° | 33° Otjiwarongo: 14° | 31° Omaruru: 17° | 34° Windhoek: 15° | 29° Gobabis: 17° | 31° Henties Bay: 15° | 21° Wind speed: 22km/h, Wind direction: S, Low tide: 10:02, High tide: 04:02, Low Tide: 22:08, High tide: 16:27 Swakopmund: 15° | 16° Wind speed: 27km/h, Wind direction: SW, Low tide: 10:00, High tide: 04:00, Low Tide: 22:06, High tide: 16:25 Walvis Bay: 15° | 23° Wind speed: 35km/h, Wind direction: SW, Low tide: 10:00, High tide: 03:59, Low Tide: 22:06, High tide: 16:24 Rehoboth: 16° | 31° Mariental: 19° | 32° Keetmanshoop: 19° | 32° Aranos: 20° | 33° Lüderitz: 14° | 25° Ariamsvlei: 18° | 31° Oranjemund: 14° | 21° Luanda: 26° | 29° Gaborone: 18° | 31° Lubumbashi: 12° | 26° Mbabane: 15° | 20° Maseru: 12° | 26° Antananarivo: 14° | 26° Lilongwe: 14° | 27° Maputo: 20° | 27° Windhoek: 15° | 29° Cape Town: 16° | 24° Durban: 18° | 23° Johannesburg: 18° | 25° Dar es Salaam: 23° | 26° Lusaka: 18° | 29° Harare: 15° | 29° Economic Indicators: Currency: GBP to NAD 23.69 | EUR to NAD 20.33 | CNY to NAD 2.62 | USD to NAD 18.97 | DZD to NAD 0.14 | AOA to NAD 0.02 | BWP to NAD 1.34 | EGP to NAD 0.39 | KES to NAD 0.14 | NGN to NAD 0.01 | ZMW to NAD 0.72 | ZWL to NAD 0.04 | BRL to NAD 3.72 | RUB to NAD 0.21 | INR to NAD 0.23 | USD to DZD 134.05 | USD to AOA 834.06 | USD to BWP 13.85 | USD to EGP 47.85 | USD to KES 134.48 | USD to NGN 1277.03 | USD to ZAR 18.98 | USD to ZMW 26.3 | USD to ZWL 321 | Stock Exchange: JSE All Share Index 74513.94 Up +0.68% | Namibian Stock Exchange (NSX) Overall Index 1545.38 Up +1.53% | Casablanca Stock Exchange (CSE) MASI 13281.24 Up +0.26% | Egyptian Exchange (EGX) 30 Index 25917.59 Down -3.21% | Botswana Stock Exchange (BSE) DCI Same 0 | NSX: MTC 7.75 SAME | Anirep 8.99 SAME | Capricorn Investment group 17.34 SAME | FirstRand Namibia Ltd 49 DOWN 0.50% | Letshego Holdings (Namibia) Ltd 4.1 UP 2.50% | Namibia Asset Management Ltd 0.7 SAME | Namibia Breweries Ltd 31.49 UP 0.03% | Nictus Holdings - Nam 2.22 SAME | Oryx Properties Ltd 12.1 UP 1.70% | Paratus Namibia Holdings 11.99 SAME | SBN Holdings 8.45 SAME | Trustco Group Holdings Ltd 0.48 SAME | B2Gold Corporation 47.34 DOWN 1.50% | Local Index closed 677.62 UP 0.12% | Overall Index closed 1534.6 DOWN 0.05% | Osino Resources Corp 19.47 DOWN 2.41% | Commodities: Gold US$ 2 325.38/OZ UP +0.39% | Copper US$ 4.50/lb UP +1.52% | Zinc US$ 2 857.40/T UP 1.8% | Brent Crude Oil US$ 87.95/BBP DOWN -0.0005 | Platinum US$ 904.66/OZ UP +0.28%