Wednesday, 16 November 2011, Johannesburg
"At the outset is important for me to confirm how we make our money" says Mark Barnes, Chairman of Purple Capital.
Purple Capital provides its clients with access to the economic outcomes in the financial, capital, sports betting and treasury markets. Revenue is volume driven and the company makes money from fees, spreads, commissions and interest.
The year of 2011 brings about a complete turnaround for the Purple Capital Group, of which the highlights of the year are:
• Operating costs in Global Trader cut by 40% over three years
• The group made an after-tax profit of R2, 7 million, the first recorded profit for Purple Capital in three years
• Clients, funds, trading volumes, mandates are all up across the group
• Total debt was R14, 8 million (R20, 3 million in 2010) at the end of the period
• The group's cash on hand at 31 August 2011 was R50, 9 million, an increase from R33, 5 million at 31 August 2010
• Shareholders' funds have increased from R236, 5 million to R267, 6 million at 31 August 2011.
Mark says of the group's success, "It's great to be making profit, be free from debt and have all the graphs going the right way."
Global Trader continues to drive the majority of Purple Capitals' revenue and delivered another set of good results in 2011. The most encouraging aspect came from the excellent growth achieved in the second half of the year coupled with a sharp increase in their client acquisition metrics.
"In the outcome a resilient set of results that point towards a marked increase in value for our shareholders in the year ahead," says CEO of the company, Charles Savage.
The acquisition of Voltbet is proving to be a good one. Whilst the executive were quick to play down the contribution expected from the business in the year ahead, as they continue to invest substantially in this early stage investment, it's clear from the numbers presented that this business is set to play a much larger role in the future and having spoken to management about their plans for the year ahead I wouldn't be surprised if this business made a healthy contribution to profit in 2013.
Purple Capital also operates the largest independent outsource treasury solutions service provider by volume in South Africa and their substantial volume advantage will result in profit in the year ahead.
Understanding the value ascribed from the investment in Real People is worth spending some time over. Mark is confident that Real People is one of the industry leaders in the emerging financial markets of South Africa, a view already confirmed by their successful capital market issue and exceptional growth in profit.
In my view these results it would seem that Purple Capital stands at the cross over point of the value 'double'. As indebtedness declines and profitability increases, a step change is likely to manifests that should reward those that have patiently supported the company over the last three years. Essentially this means that instead of paying interest to the banks Purple Capital will be paying dividends to its shareholders.
Ends
For additional information, please contact:
Briony Fickling
Marketing and PR Administrator | Global Trader
(011) 214 8021
082 679 4573
marketing@gt247.com
3rd Floor, 10 Melrose Boulevard Melrose Arch, 2196
About Purple Capital:
Purple Capital Limited, registered and incorporated in the Republic of South Africa, is a financial services company listed on the "Financial – General Financial" sector of the Johannesburg Stock Exchange with a current market capitalization of approximately R250 million. Purple Capital operates in the derivatives trading, sports betting, treasury outsourcing and corporate finance industries.
If you require additional information on the Group or its products and services, please visit our website at www.Purplecapital.com
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