The group reported that the effective tax rate for the period of 27% is significantly lower than that of the prior period which was 42% with the absorption of the accelerated withholding tax paid on dividends declared by subsidiary companies to Sefalana Holding Company Limited.
During the reporting period, overall Botswana business units have generated P120 million of profit before tax for the period compared to P75 million in the prior one. The most significant growth has been in the trading consumer goods sector with an impressive turnaround in both wholesale and retail business. Group Managing Director (MD) Chandra Chauhan pegs the development to the diversification accomplished across sectors. “This is our best half-year results to date in our 48-year history.
Our diversification across sectors and territories has helped enable us to consistently deliver better results year on year,” he said. Chauhan said during the period, they invested significantly in inventory to ensure shortages were minimised, a move that enabled the group to avoid stock-outs and provide its customer base with a consistent product offering. “There have been numerous price increases from suppliers in South Africa over the last 18 months, and where possible we have increased procurement to mitigate these increases. In doing so, we have been able to delay price increases to our end consumers in many instances,” he said.
The MD said the group’s cash position at the end of October 2022 is satisfactory and sufficient to meet their current liabilities with sensible and prudent retention.
Overall he said their working capital position remains strong and puts them in good stead as they approach the year's end. The group’s net asset position grew from P2 billion as at April 2022 to P2.2 billion as at October 2022 and this is after the P75.2 million final dividend paid to shareholders in the same year. The market capitalisation of the group as at October 2022 amounted to P2.4 billion, placing Sefalana as the largest earner in the retail and wholesale sector on the Botswana Stock Exchange, according to the MD.
