Johnnic eyes financial services sector
JOHNNIC's share price surged R3 to R65 on Wednesday, a day after posting good results in the year to end June and the group looks set to consolidate by expanding into financial services and strengthening its media interests.
The industrial group, controlled by the National Empowerment Consortium, recently appointed Irene Charnley, a former executive member of the National Union of Mineworkers, as an executive director in charge of its expansion and new business.
"We want to capture and have a full grip of the market, particularly in financial services, media and gaming, says Charnley.
Charnley says the group has been exploring opportunities in the financial services sector, although nothing tangible is on the table yet. "It's a significant growth area internationally and we are exploring available options," says Charnley.
Johnnic, via its property division and Conrad Internationals Hotels, (an SA subsidiary of Hilton Hotels), and empowerment partners, has put in a bid for a R2-billion casino licence in Midrand. If the bid is successful the property division, in which Johnnic's gambling interests are housed, will be listed on the Johannesburg Stock Exchange.
If listed, Charnley says 25% of the equity will be set aside for blacks: 12.5% will be housed in trust; 10% to individuals in the outlying Midrand black areas in a scheme similar to Ikageng and Phuthuma; and 2.5% to employees at the casino and hotel operations.
She says the group is still interested in the Sowetan newspaper, owned by New Africa Investments. "We are still interested in acquiring the Sowetan, but have to convince Dr Nthato Motlana to sell."
Johnnic this week posted a 13% rise to 325c in headline earnings, on the back of strong performances by Premier (Johnnic has a 27.8% interest), and property (wholly owned).
Group revenue was up 56% to R436-million and it declared a final dividend of 80c, bringing the total dividend to 101c.
The unbundling of Omni Media, which controls 91.9% of TML, seems to have been put on hold. The division chipped in R69.4-million in earnings; Johnnic's 13.7% interest in SA Breweries remains the biggest contributor to group earnings at R260.9-million and Premier threw in R92.3-million.
A casino licence would strengthen the group's property division, which contributed R44-million in earnings. During the year the group disposed of its 26.4% interest Toyota.
Charnley is positive on prospects, particularly if a gaming licence is awarded to Johnnic. Top of page