The first half of 2019, and latter part of the Ecsponent Group’s financial year has seen international markets recouping some of the ground lost in 2018. Unfortunately, the upswing reflected in the local markets during the first quarter has not been sustained and South Africa is likely to continue to reflect negative real growth. While rising valuations is good news, the likelihood of market volatility or perhaps even a correction is increasing proportionally.
Although not entirely immune to the greater economic and political environments, the Ecsponent Group’s resilient business model remains unchanged.
Demand for credit remains strong and particularly in the SME sector across Southern Africa, which remains underserved and offers the Group significant opportunities to produce liquidity, cashflow and profits in the shorter term. To generate sustainable long-term returns, the Group continues to invest in companies that operate in growth segments in niche industries with high barriers to entry, which are led by competent management teams and are therefore likely to produce significant returns.
Combined, these business focus areas provide the Group with opportunities for significant asset appreciation, while generating sufficient short-term liquidity to meet operational needs.
Since the start of 2019, the Group has announced and entered into transactions that support its objectives in these business areas that would substantially increase the Group’s total assets and over time, would result in attractive yields for investors.
To provide an update on the Group’s operational progress since the last reporting period ended 31 December 2018, Ecsponent’s management team invites all its shareholders and stakeholders to participate in a pre-close investor call at 10:00 (CAT) on 25 June 2019.