Golden Sibanda Senior Business Reporter
The National Social Security Authority (NSSA), says it has increased its shareholding in hotelier, Rainbow Tourism Group (RTG), from 60 percent to 67 percent, enabling the group’s management to have clear control and direction. NSSA acting chairperson Daphne Tomana, said that the State pensions authority first increased its interest in RTG from 36,38 percent to 56,34 percent in December last year.
The pensions authority then increased its stake in RTG to 67,23 percent in 2018 after raising $22,5 million needed by the hotelier to restructure its statement of financial position.
“Following the successful capital raising of $22,5 million needed to restructure the statement of financial position, the authority subsequently increased its stake to 67,23 percent in 2018,” Mrs Tomana said in accompanying NSSA results.
Mrs Tomana said RTG was strategically important to the economy given its foreign currency generating capacity, more so with the growing number of foreign tourists.
“It would be pertinent to leverage on the positive sector fundamentals to ensure RTG optimises shareholder value, as the business positions for internationally reputable brands affiliation through strategic and technical partnerships.”
Meanwhile, NSSA said its revenue in the 12 months to December 2017 declined 1 percent to $354 million, but profit jumped 21 percent to $149 million.
“The authority achieved a surplus of $149 million in 2017, compared to $105,9 million in 2016. This significant improvement in profitability is attributable to increased investment income and less write downs, which more than offset the decline in contributions,” said Mrs Tomana.
Revenue declined on account of reduction in contributions and premiums, which fell 11 percent from $276,5 million in 2016 to $247 million 12 months later.
However, investment income increased by 133 percent to $54,6 million in 2017. This was attributed to investments in Treasury Bills, which partly offset the decline interest rates, capital uplifts on loans, advances and bad debt recoveries.
The share of profits from associates was $12 million in 2017 compared to $10,8 million in 2016, which was a combination of subdued losses in some associates (Fidelity Life and Turnall) and increase in profits in other associates (FBC, ZB and OK)
Mrs Tomana said that operating expenses declined by 25 percent from $106 million in 2016 to $79,9 million in 2017. The decrease, the NSSA chairman said, was a result of a decrease in the provision of credit losses of $40,9 million in 2016.
The authority’s assets grew 30 percent to $1,371 billion from $1,052 billion in 2016.
NSSA said that it participated in the $300 million capital raise initiative through Depository Receipts in December last year. NSSA invested $20 million in exchange 4,65 million 465 class D shares, equivalent to 0,457 percent of total shares.
Source : The Herald