Capricorn Group reports 28.4% profit surge
Capricorn Group has announced exceptional financial results for the six months ending December 31, 2024, with profit after tax soaring by 28.4% to N$1.06 billion compared to N$827.6 million during the same period last year. The impressive performance has translated to a 29.1% increase in earnings per share, reaching 196.80 cents.
In a statement released, Capricorn Group CEO David Nuyoma attributed the strong showing to "excellent results and solid all-round performances" by the Group's subsidiaries, including Bank Windhoek, Bank Gaborone, Capricorn Asset Management, Entrepo, and Peo Finance, as well as its associates.
The financial services group reported a 27.0% increase in operating profit for the half-year period, driven by improved net interest margins, robust growth in non-interest income, and lower impairment charges. The Group's annualized return on equity also improved from 16.8% to 19.1%.
"Our outlook for Namibia's economy is promising, with an expected growth of 4% in 2025 driven by a resurgence in primary industries and continued positive performance in secondary sectors like manufacturing, electricity, and water," Nuyoma said.
According to the CEO, Namibia is well-positioned with a favorable economic trajectory supported by lower interest rates, sectoral growth drivers, and currency stability. Similarly, Botswana's GDP is anticipated to grow between 3% and 4% in 2025, recovering from the 2024 contraction caused by the global diamond market slump.
The Group reported a 12.7% year-on-year increase in net interest income, attributed to a 5.7% increase in gross loans and advances and effective cost of funding management. Despite a 75 basis-point reduction in the Namibian repo rate, Bank Windhoek's net interest margin improved to 5.28% from 5.11%, while Bank Gaborone's margin increased to 4.39% from 4.07%.
Impairment charges decreased by 25.7% year-on-year due to better credit risk indicators, while non-performing loans decreased by 0.6% to N$2.39 billion, resulting in a lower NPL ratio of 4.6%, down from 4.7% in June 2024.
Non-interest income rose by N$179 million (16.1%) on increased transaction and trading volumes, with transaction-based fee income up 13.6% and net trading income increasing by 16.3%. Assets under management grew to N$52.2 billion from N$46.6 billion in June 2024, boosting asset management fees by 19.2% to N$122 million.
Operating expenses increased by 12.1% year-on-year, including a 16.4% rise in variable operational banking expenses directly linked to increased transaction volumes.
The Group maintained a healthy liquidity position, with liquid assets increasing by 11.5% year-on-year and exceeding minimum regulatory requirements in Namibia and Botswana by 163% and 92%, respectively. Its capital position remains robust, with a total risk-based capital adequacy ratio of 18.1% as of December 2024.
Following these strong results, Capricorn Group has declared an interim dividend of 61 cents per ordinary share, representing a 27.1% increase from the 48 cents declared in the comparative period last year.
In a statement released, Capricorn Group CEO David Nuyoma attributed the strong showing to "excellent results and solid all-round performances" by the Group's subsidiaries, including Bank Windhoek, Bank Gaborone, Capricorn Asset Management, Entrepo, and Peo Finance, as well as its associates.
The financial services group reported a 27.0% increase in operating profit for the half-year period, driven by improved net interest margins, robust growth in non-interest income, and lower impairment charges. The Group's annualized return on equity also improved from 16.8% to 19.1%.
"Our outlook for Namibia's economy is promising, with an expected growth of 4% in 2025 driven by a resurgence in primary industries and continued positive performance in secondary sectors like manufacturing, electricity, and water," Nuyoma said.
According to the CEO, Namibia is well-positioned with a favorable economic trajectory supported by lower interest rates, sectoral growth drivers, and currency stability. Similarly, Botswana's GDP is anticipated to grow between 3% and 4% in 2025, recovering from the 2024 contraction caused by the global diamond market slump.
The Group reported a 12.7% year-on-year increase in net interest income, attributed to a 5.7% increase in gross loans and advances and effective cost of funding management. Despite a 75 basis-point reduction in the Namibian repo rate, Bank Windhoek's net interest margin improved to 5.28% from 5.11%, while Bank Gaborone's margin increased to 4.39% from 4.07%.
Impairment charges decreased by 25.7% year-on-year due to better credit risk indicators, while non-performing loans decreased by 0.6% to N$2.39 billion, resulting in a lower NPL ratio of 4.6%, down from 4.7% in June 2024.
Non-interest income rose by N$179 million (16.1%) on increased transaction and trading volumes, with transaction-based fee income up 13.6% and net trading income increasing by 16.3%. Assets under management grew to N$52.2 billion from N$46.6 billion in June 2024, boosting asset management fees by 19.2% to N$122 million.
Operating expenses increased by 12.1% year-on-year, including a 16.4% rise in variable operational banking expenses directly linked to increased transaction volumes.
The Group maintained a healthy liquidity position, with liquid assets increasing by 11.5% year-on-year and exceeding minimum regulatory requirements in Namibia and Botswana by 163% and 92%, respectively. Its capital position remains robust, with a total risk-based capital adequacy ratio of 18.1% as of December 2024.
Following these strong results, Capricorn Group has declared an interim dividend of 61 cents per ordinary share, representing a 27.1% increase from the 48 cents declared in the comparative period last year.
