Sasfin Holdings, a South African financial services group, has recorded significant financial losses for the year ending June 2024.
Story Summary:
- Sasfin posted a headline earnings loss of R58.68 million for 2024, down from a profit of R112.68 million in 2023.
- The company plans to delist from the JSE as part of its strategic reset, following the sale of non-core businesses like Commercial Property Finance.
- Despite the overall losses, Sasfin’s Wealth and Rental Finance divisions performed well, while Business and Commercial Banking continued to struggle.
Sasfin financial results explained: Here’s what you must know
The company’s headline earnings took a dramatic plunge, reporting a loss of R58.68 million, a stark contrast to the profit of R112.68 million in 2023.
This resulted in a headline earnings per share loss of 190.96 cents, compared to a profit of 366.18 cents per share the previous year.
In light of the financial strain, Sasfin has announced plans to delist from the Johannesburg Stock Exchange (JSE).
This decision follows a strategic reset that saw the company make considerable changes, including disposing of non-core businesses.
The group is looking to focus on its core operations, particularly in Wealth and Rental Finance, which performed relatively well amid tough economic conditions.
However, the Business and Commercial Banking (BCB) division continued to struggle, posting losses of R156.09 million in 2024.
Financial Highlights:
- Group loss: R60.10 million, compared to a profit of R108.8 million in 2023.
- Total assets: Decreased by 8.34%, from R14.031 billion in 2023 to R12.861 billion in 2024.
- Capital adequacy ratio: Dropped to 15.87%, down from 16.23%.
- Deposits from customers: Declined by 4.95%.
Sasfin’s CEO Michael Sassoon noted that the company’s poor performance was exacerbated by increased credit losses, a decrease in non-interest income, and negative fair value adjustments in its Private Equity portfolio.
The Group also incurred substantial costs due to its strategic reset and the exiting of non-core activities, including the closure of its Forex business.
Strategic reset and delisting
The decision to delist from the JSE marks a pivotal step in Sasfin’s efforts to streamline its operations.
Sasfin has made meaningful progress in its strategic reset, including:
- Selling its Commercial Property Finance and Capital Equipment Finance businesses to African Bank for approximately R3.14 billion.
- Closing non-core operations such as the Foreign Exchange business.
This restructuring is aimed at positioning Sasfin for long-term success by focusing on its core wealth management and rental finance segments, while gradually exiting other businesses, including Business and Commercial Banking, by 2025.
Sasfin’s Chairman Richard Buchholz expressed optimism about the company’s future following the delisting, stating that the strategic reset will lead to a leaner, more focused organisation that can generate healthy returns in the future.
“The strategic reset is expected to reposition the Group for sustainable growth by focusing on our core strengths. While the delisting marks the end of an era for Sasfin, it is a necessary step towards a more focused organisation that can generate meaningful returns for stakeholders,” Buchholz said.
