Exit from food ventures gives Grand Parade profit boost
The group has benefited after exit from loss-making franchises such as Dunkin Donuts and Baskin Robbins
Grand Parade Investments, which recently announced the sale of its SA Burger King licence, said on Friday the exit from its restaurant interests helped it halve debt and improve profits in its half year to end-December.
The group is seeking to reduce a hefty discount to its intrinsic net asset value per share, exiting Baskin Robbins and Dunkin Donuts in February 2019.
Grand Parade reported that headline earnings more than doubled to R44.1m, with Baskin Robbins and Dunkin Donuts having contributed R24m in losses in the prior period.
Headline earnings is a widely used profit measure in SA, stripping out one-off items such as writedowns to give a better indication of underlying performance.
Group debt fell to R264m, from R565m previously, while the group’s net asset value per share (NAV) increased 1.83% to 445c per share.
At this level the group is trading at a discount of 32% to its NAV from Thursday’s close, and the company is seeking to reduce this to between 20% and 30%.
It also sold off its 10% stake in Spur for R260m in June, while it said in August it was planning to sell its remaining 30% stake in Sun Slots for R504m. The latter sale is still subject to Gaming Board approval, and is only expected to take place at the end of March 2020.
In February, it said it had agreed to sell its Burger King licence, for a yet to be determined amount.