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Trustco profit down by 3%

Property down, micro-finance up

Diversified group, Trustco, has announced a marginal decline in after-tax profit for the six months ended 30 September 2012.
In a statement to shareholders, Trustco said unaudited results show that group profit declined 3% from N$52 million in the comparative period last year to N$50 million. The fall in profit is as a result of a 26% decrease in after-tax profit in the group’s Property and Mortgage division. Trustco also attributed the fall in profit to a 10% decrease in group revenue as a result of the cessation in February 2012 of the contract relating to the provision of Trustco mobile services in Zimbabwe.
But while the property and mortgage unit suffered, Trustco’s two other units – Micro Insurance and Technology, and Micro Finance and Education – recorded positive margins. The Namibian operations under Micro Insurance and Technology recorded a 16% increase in after tax profit while the South African subsidiary recorded a net profit of N$13 million despite “ a fiercely competitive market”.
Micro Finance and Education also saw a 10% increase in margins after loans grew by 16%. As of 30 September 2012, the micro finance loan book stood at N$268 million up from N$231 million in September 2011.
Trustco downplayed the marginal fall in profit saying“ historically the second half of the financial year has materially exceeded the performance of the first half, due to the cyclical nature of the business.”
Despite the fall in profit and group revenue, Trustco achieved headline earnings of N$50 million  compared to N$47 million last year. The company also declared an interim dividend of 1.90 cents per share for the six months ended 30 September 2012, slightly higher than the 1.75 cents declared for the comparative period last year.

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