Brainworks defers results release, gives positive earnings guidance

JSE-listed Brainworks Capital, whose operating primary assets are all in Zimbabwe, said it has delayed publication of its earnings for the 12 months period to December in line with the monetary policy developments and the succeeding guidance by the PAAB.

Brainworks’ operating subsidiaries in Zimbabwe include African Sun which is into hospitality and Dawn Properties a real estate company, among other entities. The 2 are listed on the ZSE.

Almost a fortnight ago, the ZSE extended the reporting period by a month to allow for companies to factor the various implications of the monetary policy changes notably in terms of need to comply with IFRS 21.

At the time the extension was granted, the PAAB, which is the board of accounting and auditors charged with ensuring standards are met, had not given guidance. The board gave a position a few days after the extension was granted.

In its guidance, the PAAB advised that at a minimum, in the notes to the financial statements, three additional sets of the statement of financial position be prepared in a certain format. The elements of the statement of financial position was to be analysed into three categories namely Monetary assets and liabilities (Nostro FCA USD) Monetary assets and liabilities (RTGS Dollar) and Non-monetary assets and liabilities (whose underlying values or amounts are denominated in USD).

The PAAB guidance further encouraged preparers to also disclose the key assumptions made by management in the preparation of the analysis as well as explaining that the amounts presented may therefore not reflect the opening balances in RTGS Dollars going forward.

In an operations update for the period under review, Brainworks said it recorded revenue growth across all business segments notably in the hospitality segment.

The growth in hospitality revenue was achieved on the back of a 7 percentage points increase in occupancy levels to 59% and a 17% increase in average daily rate from $93 to $109.

The growth in occupancy levels was driven by a strong performance from all source markets with room nights sold for domestic, international and regional increasing by 12%, 14% and 7% respectively.

Property sales in the inaugural year saw income from the segment rising sharply ahead of the prior year. Brainworks said 70% of the growth was attributed to property sales. This followed the completion of the group’s maiden development project in Harare.

The Group said it is confident of achieving a positive earnings per share in the period under review.

-Equity Axis News

Raynold M

Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment.

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