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BRIMSTONE INVESTMENT CORPORATION LIMITED - Voluntary Quarterly Intrinsic Net Asset Value (NAV) disclosure

16 May 2019 - 16:48 PM
BRT BRN
Voluntary Quarterly Intrinsic Net Asset Value (NAV) disclosure

Brimstone Investment Corporation Limited
(Incorporated in the Republic of South Africa)
Registration number 1995/010442/06
Share Code: BRT ISIN: ZAE000015277
Share Code: BRN ISIN: ZAE000015285
("Brimstone" or the Company)

Voluntary Quarterly Intrinsic Net Asset Value (NAV) disclosure

A full analysis of the Intrinsic NAV, together with applicable explanations for the quarter ended 31 March 2019 is set out below.

Summary                                                                 Change             31 March           31 December            31 December    31 December    31 December    31 December
                                                              December 2018 to                 2019                  2018                   2017           2016           2015           2014
                                                                    March 2019
Intrinsic NAV of Brimstone (Rm)                                           2.2%              3 985.0               3 899.6                4 317.9        5 133.9        4 229.4        4 862.3
Book NAV (Rm)                                                           (3.0)%              2 633.2               2 713.4                2 782.0        2 427.1        2 530.3        3 325.0
Intrinsic NAV per share (cents)                                          2.2%              1 650.5               1 615.1                1 800.9        2 139.5        1 741.4        1 979.4
Fully diluted Intrinsic NAV per share (cents)                            2.2%              1 634.0               1 598.8                1 750.9        2 043.1        1 647.8        1 857.8
Book NAV per share (cents)                                              (3.0)%              1 090.6               1 123.8                1 160.3        1 011.5        1 044.0        1 356.3
Market price per share (cents)
   Ordinary shares                                                     (11.4)%                  930                 1 050                  1 300          1 299          1 350          1 700
   N Ordinary shares                                                  (0.4)%                  945                   949                  1 125          1 200          1 270          1 650
Discount to Intrinsic NAV
  Ordinary shares                                                                             43.7%                 35.0%                  27.8%          39.3%          22.5%          14.1%
  N Ordinary shares                                                                         42.7%                 41.2%                  37.5%          43.9%          27.1%          16.6%

Intrinsic NAV analysis by asset

An analysis of the Intrinsic NAV of Brimstone as at 31 March 2019 is set out below, including the valuation basis of each asset.
Where applicable, Intrinsic NAV is net of ring-fenced debt and potential CGT relating to that asset.


 Asset                        % held           Share         Share            Valuation basis        Gross         Debt          CGT        March        March       Gross      December      December       Increase /
                                         price at 31   price at 31                                   value      (R'000)      (R'000)         2019         2019   portfolio          2018          2018       (Decrease)
                                               March      December                                 (R'000)                              Intrinsic    Intrinsic   weighting     Intrinsic     Intrinsic
                                                2019          2018                                                                            NAV      NAV per                       NAV       NAV per
                                                                                                                                          (R'000)        share                   (R'000)         share
                                                                                                                                                       (cents)                                 (cents)
 Oceana                        22.9%           77.50         73.88     Market value per share    2 403 051    (955 584)    (231 287)    1 216 180        503.7       27.3%     1 243 065         514.8         (2.2)%
 Sea Harvest                  54.2%           14.20         13.75     Market value per share    2 264 458            -           -     2 264 458        937.9       25.7%     1 898 055         786.1          19.3%
 Life Healthcare 6              3.4%           26.84         26.40     Market value per share    1 328 521   (1 185 642)   (273 821)    (130 942)       (54.2)       15.1%     1 037 812         429.8       (112.6)%
 Equites                        7.7%           19.51         19.36     Market value per share      680 832            -     (42 635)      638 196        264.3        7.7%       233 995          96.9         172.7%
 Grindrod Shipping              0.3%           72.30         75.36     Market value per share        4 017            -       1 956        13 852          5.7        0.0%        45 262          18.7        (69.4)%
 Phuthuma Nathi                 7.0%          126.20        135.36     Market value per share      598 004            3           -       598 006        247.7        6.8%       512 221         212.1          16.7%
 Stadio & Milpark               5.3%            3.50          3.49   Market value per share &      193 069            -        (294)      192 774         79.8        2.2%       192 436          79.7           0.2%
                                                                                         cost
 Investment properties        100.0%                                      Capitalisation rate      206 680      (61 026)    (18 625)      127 029         52.6        2.3%       127 013          52.6           0.0%
 FPG Property Fund              9.9%                                               Book value      148 116            -      (3 427)      144 689         59.9        1.7%       144 689          59.9           0.0%
 Lion of Africa               100.0%                                               Book value            -            -     139 429       139 429         57.7        0.0%       139 429          57.7           0.0%
 MTN Zakhele Futhi 5            1.5%                                         Option valuation       37 898            -       5 045        42 943         17.8        0.4%        42 546          17.6           0.9%
 Aon Re Africa                 18.0%                                             PE valuation       92 222            -     (18 870)       73 352         30.4        1.0%        64 015          26.5          14.6%
 House of Monatic             100.0%                                      Adjusted book value       27 847            -           -        27 847         11.5        0.3%        27 847          11.5           0.0%
 Other investments           Various                                                Valuation      104 248            -     (13 709)       90 539         37.5        1.2%       100 036          41.4         (9.5)%
 Cash / (net debt)            100.0%                                               Book value      722 622   (2 168 076)          -   (1 453 334)      (601.9)        8.1%    (1 908 780)       (790.6)       (23.9)%

                                                                                                 8 811 585   (4 370 326)   (456 239)    3 985 020        1 650      100.0%     3 899 639       1 615.1           2.2%



 Grindrod  BEE 3 4             6.1%            9.46         13.65     Market value per share      438 032     (890 145)    221 263            -            -

                                                                                                 9 249 616   (5 260 470)   (234 976)    3 985 020        1 650


 Intrinsic NAV per share (cents)                                                                     3 650       (1 810)       (189)        1 650
 Fully diluted Intrinsic NAV per share (cents)                                                       3 610       (1 789)       (187)        1 634
 
 Notes:
 1. Based on 241.4 million shares (December 2018: 241.4 million shares) in issue, net of treasury shares as calculated below:
                                                                                                                                                    Number of shares in       Fully diluted number
                                                                                                                                                                  issue                  of shares
 Gross number of shares in issue                                                                                                                            259 432 321                259 432 321
 Treasury shares (fully diluted number is net of notionally realised shares issued to staff and management share trusts and FSPs)                           (17 986 483)               (15 173 318)
                                                                                                                                                            241 445 838                244 259 003
 Outstanding in the money share options                                                                                                                               -                          -
 Net shares in issue for INAV purposes                                                                                                                      241 445 838                244 259 003

 2. No CGT provided on shareholding in Sea Harvest due to potential use of the corporate relief provisions of the Income Tax Act.
 3. Due to the limited recourse nature of the Grindrod BEE funding structure, Brimstone's investment is shown at a minimum value of zero.
 4. Brimstone now holds a combination of Grindrod Limited and Grindrod Shipping shares. Price shown calculated on a pro forma basis.
 5. Valuation of MTN Zakhele Futhi investment treated as an option and was updated by an independent expert as at 31 March 2019.
 6. Brimstone has entered into a securities lending arrangement with Nedgroup Securities. At the end of the lending arrangement, Nedgroup Securities will be obligated to return the stock to
   Brimstone.

The INAV information presented has been prepared on a basis consistent with that used in the integrated report for the year ended 31 December 2018 which is available on the Companys website at
www.brimstone.co.za.

The above information is the responsibility of the directors and has not been reviewed or reported on by the Companys auditors.

16 May 2019

Sponsor

Nedbank Corporate and Investment Banking

Date: 16/05/2019 04:48:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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