PEREGRINE HOLDINGS LTD - Listed Entity +27 11 722 7400 | [email protected] CITADEL - Private Client Wealth Management +27 12 470 2500 | [email protected]
PEREGRINE CAPITAL - Hedge Fund Management +27 11 722 7482 | [email protected]
PEREGRINE SECURITIES - Prime Broking & Structuring +27 11 722 7500 | [email protected]
STENHAM ASSET MANAGEMENT - Offshore Asset Management +44 207 079 6600 | [email protected] STENHAM TRUSTEES - Offshore Trust & Fiduciary Services +44 148 171 6387 | [email protected]
JAVA CAPITAL - Corporate Finance, Merger & Acquisitions +27 11 722 3050 | [email protected]
CANNON ASSET MANAGERS - Value Asset Management +27 11 722 7580 | [email protected]
PEREGRINE FX - Foreign Exchange +27 12 348 2337 | [email protected]
THE WEALTH CORPORATION - Retirement Specialists +27 31 560 7160 | [email protected]
www.peregrine.co.za Disclaimer
Citadel Investment Services (Pty) Ltd, Peregrine Capital (Pty) Ltd, Peregrine Financial Products (Pty) Ltd, Peregrine Equities (Pty) Ltd, Peregrine Derivatives (Pty) Ltd, Peregrine Fund Platform (Pty) Ltd, Peregrine FX (Pty) Ltd, Peregrine International Wealthcare Limited, The Wealth Corpo-ration (Pty) Ltd and Cannon Asset Managers (Pty) Ltd are authorised financial services providers.
CONTACT US
PEREGRINE HOLDINGS INTEGRA
TED REPORT 2015
BOOK I GROUP
OVER
TED REPORT 2015
BOOK II
ANNUAL
FINANCIAL
ST
A
TEMENTS
stakeholder to areas that specifically address the interests of the relevant stakeholder group.
Shareholders & providers of capital
Five-year review 06
Material issues 38
Investment case 03
Chairman’s report 13
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Annual financial statements 01
Employees
Material issues 38
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Corporate governance report 54
Value added statement 09
Transformation 40 Clients
Material issues 38
Chairman’s report 13
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Annual financial statements 01
Communities, Environment & Society
Material issues 38
Chief Executive Officer’s report 14
Business segments review 22
Transformation 40
Corporate citizenship 50
Regulatory authorities
Corporate governance report 54
King III compliance checklist 110
Chairman’s report 13
Chief Executive Officer’s report 14
Peregrine Holdings Limited Registration No: 1994/006026/06 ISIN: ZAE000078127
JSE Main Board sector: Financial Services JSE Share code: PGR
Listing date: 10 June 1998
Shares in issue at 31 March 2015: 223 504 662 Headquarters: Sandton, South Africa
The consolidated and separate annual financial statements have been prepared under the supervision of RE Katz CA (SA),
the Group Chief Financial Officer Published on 04 September 2015
Design, photography and production: visioneers.co.za
Book I Book II
PEREGRINE HOLDINGS LTD - Listed Entity +27 11 722 7400 | [email protected] CITADEL - Private Client Wealth Management +27 12 470 2500 | [email protected]
PEREGRINE CAPITAL - Hedge Fund Management +27 11 722 7482 | [email protected]
PEREGRINE SECURITIES - Prime Broking & Structuring +27 11 722 7500 | [email protected]
STENHAM ASSET MANAGEMENT - Offshore Asset Management +44 207 079 6600 | [email protected] STENHAM TRUSTEES - Offshore Trust & Fiduciary Services +44 148 171 6387 | [email protected]
JAVA CAPITAL - Corporate Finance, Merger & Acquisitions +27 11 722 3050 | [email protected]
CANNON ASSET MANAGERS - Value Asset Management +27 11 722 7580 | [email protected]
PEREGRINE FX - Foreign Exchange +27 12 348 2337 | [email protected]
THE WEALTH CORPORATION - Retirement Specialists +27 31 560 7160 | [email protected]
www.peregrine.co.za Disclaimer
Citadel Investment Services (Pty) Ltd, Peregrine Capital (Pty) Ltd, Peregrine Financial Products (Pty) Ltd, Peregrine Equities (Pty) Ltd, Peregrine Derivatives (Pty) Ltd, Peregrine Fund Platform (Pty) Ltd, Peregrine FX (Pty) Ltd, Peregrine International Wealthcare Limited, The Wealth Corpo-ration (Pty) Ltd and Cannon Asset Managers (Pty) Ltd are authorised financial services providers.
Book I
PEREGRINE HOLDINGS GROUP OVERVIEW
01
THE GROUP
02
Group snapshot
09
Value added statement
13
Chairman’s report
14
Chief Executive Officer’s report
16 Directorate
22
Business segments review
36
SUSTAINABILITY
38
Material issues
39
Stakeholder engagement
40 Transformation
48
Human capital
50
Corporate citizenship
52
CORPORATE GOVERNANCE
54
Corporate governance report
66
Remuneration committee report
Book II
ANNUAL FINANCIAL STATEMENTS
01
ANNUAL FINANCIAL STATEMENTS
101
SHAREHOLDER INFORMATION
Peregrine acknowledges that this integrated report is intended to serve all stakeholders. This guide will assist in directing each stakeholder to areas that specifically address the interests of the relevant stakeholder group.
Shareholders & providers of capital
Five-year review 06
Material issues 38
Investment case 03
Chairman’s report 13
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Annual financial statements 01
Employees
Material issues 38
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Corporate governance report 54
Value added statement 09
Transformation 40 Clients
Material issues 38
Chairman’s report 13
Chief Executive Officer’s report 14
Business segments review 22
Corporate citizenship 50
Annual financial statements 01
Communities, Environment & Society
Material issues 38
Chief Executive Officer’s report 14
Business segments review 22
Transformation 40
Corporate citizenship 50
Regulatory authorities
Corporate governance report 54
King III compliance checklist 110
Chairman’s report 13
Chief Executive Officer’s report 14
Peregrine Holdings Limited Registration No: 1994/006026/06 ISIN: ZAE000078127
JSE Main Board sector: Financial Services JSE Share code: PGR
Listing date: 10 June 1998
Shares in issue at 31 March 2015: 223 504 662 Headquarters: Sandton, South Africa
The consolidated and separate annual financial statements have been prepared under the supervision of RE Katz CA (SA),
the Group Chief Financial Officer Published on 04 September 2015
Design, photography and production: visioneers.co.za
Book I Book II
STAKEHOLDERS’
NAVIGATION GUIDE
SCOPE AND BOUNDARIES
This integrated report of Peregrine Holdings Limited (Peregrine)
presents the performance of all the Group’s operations, across
all the geographies within which the Group operates, as well as
the environmental, social and governance performance of the
Group for the year ended 31 March 2015.
The prior integrated report was dated 20 August 2014.
Peregrine’s scope of reporting on its sustainability initiatives
consists of the reportable business segments in South Africa,
namely Wealth Management, Asset Management, Broking
& Structuring, Advisory and Proprietary Investments for the
duration of the year 1 April 2014 to 31 March 2015.
PURPOSE OF THE REPORT
The content included in this integrated report is intended
to be useful and relevant to Peregrine’s stakeholders, as it
is considered to be of a nature which may influence their
perception or decision-making. The content specifically aims
to provide stakeholders with an understanding of the economic,
environmental, social and governance initiatives of the Group
and their impact, to enable stakeholders to evaluate Peregrine’s
ability to create and sustain value over the short, medium and
long-term.
FRAMEWORKS AND GUIDELINES APPLIED
This, Peregrine’s fifth, integrated report is prepared in
accordance with International Financial Reporting Standards
(IFRS), the requirements of the South African Companies Act
71 of 2008 (Companies Act), and the Listings Requirements of
the JSE Limited. Peregrine has further applied the majority of
the principles contained in the King Code of Governance for
South Africa (2009) (King III), as encapsulated in the applicable
regulations. Any King III principles which have not been applied
are explained, including, wherever possible, reference to the
part of the year during which the non-compliance occurred.
ASSURANCE
Assurance of certain aspects of this integrated report is the
responsibility of a combined financial and non-financial team
from KPMG Services. In addition to the annual financial
statements being audited by KPMG whose unmodified opinion
is included on page 9 of Book II of this Integrated Report, the
value added statement on page 9 was assured at a limited
level, based on adopting International Standards for Assurance
Engagements (ISAE) 3000. KPMG Services assurance report
on this integrated report, which includes certain unmodified
conclusions, is available online at www.peregrine.co.za
FORWARD-LOOKING STATEMENTS
This integrated report contains forward-looking statements that,
unless otherwise indicated, reflect the Group’s expectations
as at 31 March 2015. Actual results may differ materially from
the Group’s expectations, should known and unknown risks
or uncertainties affecting its businesses, or if estimates or
assumptions prove inaccurate. The Group cannot guarantee
that any forward-looking statements will materialise and
accordingly readers are cautioned not to place undue reliance
on any forward-looking statements. The company disclaims any
intention and assumes no obligation to update or revise any
forward-looking statements, even if new information becomes
available as a result of future events or for any other reason,
other than as is required by the JSE Listings Requirements.
STATEMENT OF RESPONSIBILITY
The Audit Committee acknowledges its responsibility, on behalf
of the board, to ensure the integrity of this integrated report.
The committee has accordingly applied its mind to the report
and believes that it appropriately and sufficiently addresses all
material issues, and fairly presents the integrated performance
of Peregrine and its subsidiaries for the year, within the scope
and boundaries mentioned in the preceding paragraphs. The
Audit Committee recommended this integrated report to the
board for approval.
BOARD APPROVAL
The board is satisfied that this integrated report is a fair representation of the performance of the Group.
Peregrine’s 2015 integrated report was approved by the board and signed on its behalf by:
Jonathan Hertz
Robert Katz
Steven Stein
GROUP
Driven by an owner-managed and entrepreneurial
culture, the Group invests on behalf of both its clients’
and the Group’s proprietary capital, and manages related
transactions. Peregrine Group comprises a number of
niche financial services businesses in which it holds either
significant management control or ownership.
The Group focuses exclusively on operating financial
services businesses in South Africa and internationally,
with an appropriate and sustainable B-BBEE shareholding,
directly into its South African businesses, via Peregrine
SA Holdings. The Group operates through six business
segments: Wealth Management, Asset Management,
Broking & Structuring, Stenham, as well as Advisory, with
underlying operating businesses being supported by making
capital investments, the bulk of which constitute investments
into hedge funds, managed by the Group’s fund managers.
The Group is listed on the JSE under the ‘Financial Services’
Sector and at year-end had a market capitalisation of R5,8
billion and held responsibility for R91 billion in total gross
assets under management and or administration/advice.
Through three of its subsidiaries – Citadel, Peregrine Capital
and Stenham – the Group operates in the fields of Private
Client Wealthcare, South African and global funds-of-funds
and single manager hedge funds. Furthermore, Peregrine
houses one of South Africa’s leading derivatives, equity and
prime broking operations, through Peregrine Securities. In
line with the Peregrine growth strategy, the Group acquired
50% of Java Capital, a leading independent corporate
finance, advisory and investment business.
When evaluating acquisitions, Peregrine considers, inter
alia, the profitability, cash generative capacity, future growth
prospects, ethical conduct and the governance structures
of the target entity. Peregrine has an international footprint
spanning South Africa, the UK and the Channel Islands and
it employs close to 700 individuals worldwide. For the year
under review, the Group’s activities were categorised into
the following reporting segments:
Business Segments
•
Wealth Management
•
Asset Management (Local & Offshore)
•
Broking & Structuring
•
Stenham
•
Advisory
•
Proprietary Investments
Peregrine’s key business strategic objective is to deliver
consistently high levels of risk-adjusted returns to its
shareholders over the medium to long-term. This is primarily
driven by Peregrine’s resources and personnel, which the
Group believes to be of unrivalled expertise. The Group’s
unswerving focus on performance is balanced by an
entrepreneurial approach and steadfast commitment to
governance, which have together generated a business
model that is well respected by partners, peers and clients
and is recognised by the financial services industry at large.
GROUP SNAPSHOT
Peregrine is a leading financial services group providing individuals and institutions with
investment management solutions in wealth and alternative assets.
Executive Directors (Left to Right) Mandy Yachad, Jonathan Hertz and Robert Katz
2
-20 40 60 80 100 120 140 160 2009 2010 2011 2012 2013 2014 2015
Ordinary Dividends per share (c)
0 20 40 60 80 100 120 140 160 2011 2012 2013 2014 2015Ordinary Dividends per Share (Cents)
35 72 72 100 150 0 500 1000 1500 2000 2500 3000 2011 2012 2013 2014 2015
Total Income (Rm) *
1,684 1,767 1,737 2,117 2,638 -20 40 60 80 100 120 2009 2010 2011 2012 2013 2014 2015G3 - Gross AUM
0 2011* Includes non-controlling interests
2012 2013 2014 2015
Headline Earnings (Rm)
100 200 300 400 500 600 287 321 286 409 534• Basic earnings up 56% to R645 million
• Basic earnings per share up 53% to 327.0 cents
per share
• Headline earnings up 31% to R534 million
• Headline earnings per share up 28% to
270.9 cents per share
• Total revenue up 25% to R2.6 billion
• Profit from ordinary activities up 32% to
R995 million
• Net asset value per share up 23% to
R12.49 per share
• Dividend per share up 50% to 150 cents per share
INVESTMENT CASE
• High dividend pay-out
• Entrepreneurial and owner-managed culture
• Highly skilled teams
• Commitment to responsible investing
• Commitment to sustainable development
• Best practice governance standards
• Low staff turnover at executive and operational
level
• Only reward excellence
The Peregrine Group seeks to invest in businesses which are market
leaders within their own segments, have the ability to benefit from other
entities within the Group and can add value to other entities within the
Group. We are active within six business segments which are distinct
from one another and yet interconnected with many common clients and
integrated offerings. The contribution to earnings from each segment
is significant resulting in a diversified Group with the ability to navigate
conditions that may be detrimental to a single business segment.
GROUP STRUCTURE
• Peregrine Equities founded • Initial 7% of Citadel acquired with option to increase up to 20%
1997
• Peregrine founded
1996
Milestones
*As at 31 March of the relevant yearCEO’s note
PEREGRINE HOLDINGS LIMITED
CITADEL 100%
JAVA CAPITAL 50%
THE WEALTH CORPORATION 100%
Wealth Management
PEREGRINE SECURITIES 65%
DERIVATIVES 100%
FINANCIAL PRODUCTS 100%
EQUITIES 100%
Broking & Structuring
Advisory
PEREGRINE SA HOLDINGS 80% SANDOWN CAPITAL 100%Proprietary Investments
STENHAM 80.9% PEREGRINE CAPITAL 50% SA ALPHA 49.9%CAVEO FUND SOLUTIONS 49.9%
GREEN OAK CAPITAL 50%
CANNON ASSET MANAGERS 65%
ASSET MANAGEMENT 100%
TRUST & FIDUCIARY 100%
Asset Management
• Peregrine lists on JSE • Peregrine Capital founded • Number of employees: 30*
1998
• Stakeholding in Citadel increased to control • Number of employees: 159*2001
• Peregrine Incubator/PIM founded (subsequently renamed Peregrine Fund Platform) • Citadel becomes wholly-owned subsidiary • Assets under management:
Gross R3,3 billion*
2002
• Assets under management: Gross R11,2 billion* • Number of employees: 417*
2003
• Caveo Fund Solutions founded with Investment Solutions • B-BBEE transaction implemented • Assets under management: Gross R23,0 billion* • Number of employees: 353*
2006
MAR 14 MAR 15 MAR 14 MAR 15 MAR 14 MAR 15
0 50 000 100 000 150 000 200 000 250 000 300 000 350 000 400 000 450 000
ANNUITY VARIABLE PROPRIETARY
INVESTMENTS
WEALTH MANAGEMENT ASSET MANAGEMENT
BROKING & STRUCTURING STENHAM
ADVISORY
PROPRIETARY INVESTMENTS
Quality of Earnings (Rm)
Business Segmental Analysis
Contribution to profitability as at 31 March ( Major business units)
267,100 416,788 191,995 216,223 99,396 181,7932014
18%
16%
11%
42%
13%
2015
5%
16%
30%
18%
13%
18%
4
• Controlling interest acquired in Stenham • Assets under management: Gross R43,4 billion* • Number of employees: 418*
2008
Major shareholders*
%
Founders, management & staff 27.87% Offshore Institutions excl. Wasatch 9.74% PIC 8.60% Allan Gray 7.70% Investec 7.12% 36ONE 6.48% Old Mutual 6.45% Wasatch Advisors 5.40% Prudential 4.49% Sanlam 3.46% Electus 1.57% TOTAL 88.88% * % shareholding calculated net of non-participating treasury shares (Net outstanding shares 213 020 348)
2015
11%
28%
61%
OTHERS INSTITUTIONS
• 50% of Green Oak Capital acquired • 35% of Peregrine Securities sold
to management • Assets under management:
Gross R77,0 billion* • Number of employees: 579*
2010
• Nala founded (Peregrine’s B-BBEE partner) • ApexHi UK Limited established • 49.9% stake acquired in SA Alpha
Capital Management Limited (Bermuda based asset manager)
• The best financial results in the company’s history • Highest ordinary dividend paid • Stenham Property sale into dual
listed Stenprop vehicle • Acquisition of 50% stake in Java Capital • Increase in Shareholding in Stenham Limited to over 80% • Citadel celebrated reaching its
20 year operating anniversary • Acquisition of a 65% stake in
Cannon Asset Managers • Payment of an ordinary dividend of 100 cents, up 39% • Citadel increases stake in The Wealth Corporation to 100% • Citadel executives acquire a further significant stake in Peregrine • Peregrine reaches 15 years
since listing on the JSE Limited • Citadel acquires 70% stake in The Wealth Corporation • Payment of second special dividend
2011
2012
2013
2014
2015
• Restructuring of B-BBEE shareholding • Refined Group strategy
and structure • Payment of first
special dividend Income Statement
Total revenue (R’000) Profit / (loss) from operations (R’000) Headline earnings (R’000) Attributable earnings / (loss) (R’000)
Headline earnings per share (cents) Ordinary dividend per share declared subsequent to 31 March (cents) Special dividend per share (cents)
Number of shares outstanding (adjusted for treasury shares) (‘000) Statement of financial position Shareowners’ equity (R’000) Return on average equity (%) Net asset value per share (cents) Net tangible asset per share (cents) Gross assets under management (R’000) Personnel Number of employees at year end # Includes R892,820 of gross Stenham impairment * Includes R753,040 of net Stenham intangible impairment
PRICE (ZAR
cents
)
PEREGRINE VOLUME TRADED (Million)
1,683,965 1,767,089 1,737,305 2,116,918 2,638,352 480,475 517,809 (473 362) # 662,156 851,940 287,249 321,450 286,371 408,864 534,345 307,952 313,860 (466,669) * 425,023 676,951 131.9 147.7 138.9 211.5 270.9 35.0 72.0 72.0 100.0 150.0 - 42.4 28.0 - - 217,763 217,576 196,307 192,517 203,020 1,732,023 2,184,309 1,706,938 2,063,521 2,660,901 19.1 16.0 (24.0) 22.5 28.7 795.4 1,003.9 869.5 1018.9 1249.1 350.0 508.4 628.3 737.9 986.8 81,553 72,823 78,641 95,957 90,964 565 558 524 573 672 2012 2011 2013 2014 2015
500
0
1000
1500
2000
ALSI (rescaled) DIVIDENDS0
5
10
15
20
25
MAR JUL JUL JUL JUL JULMAR MAR MAR MAR
72c
100c
ACCOLADES
Stenham Advisors
Best Investor Relations Team
Hedge Funds Review
Peregrine Capital, High Growth Fund
Long-term Performance - Single Manager
based on three-year returns
HedgeNews Africa
Peregrine Securities
#1 Overall Equity Derivative Products
Risk Magazine
Peregrine Securities
#1 Overall Derivative Firm (weighted)
Financial Mail
Peregrine Securities
#1 Derivatives Dealing and Derivative Research
Financial Mail
Stenham Credit Opportunities
Top 10 Performing Fund of Hedge Fund - Fixed Income
BarclayHedge
Stenham Asia
Top 10 Performing Fund of Hedge Fund - Emerging Markets
BarclayHedge
Stenham Healthcare
Top 10 Performing Fund of Hedge Fund
(US$ 10 million - US$ 250 million)
BarclayHedge
2015
2014
2013
Java Capital
#1 in General Corporate Finance (by deal flow)
Investment Advisor & JSE Sponsor
Java Capital
#1 in Merger & Acquisitions (by deal flow)
Investment Advisor & JSE Sponsor
Peregrine Capital
Five Year Performance - Single Manager
HedgeNews Africa
Peregrine Capital, High Growth Fund
Fund of the Year
HedgeNews Africa
Peregrine Capital, Pure Hedge Fund
Market Neutral and Quantitative category - Single Manager
HedgeNews Africa
Java Capital
#1 in General Corporate Finance (by deal flow)
Investment Advisor & JSE Sponsor
Java Capital
#2 in Merger & Acquisitions (by deal flow)
Investment Advisor & JSE Sponsor
Peregrine Securities
#1 Overall Equity Derivative Products
Risk Magazine
2015
2014
R'000
%
R'000
%
Wealth created
Revenue, investment returns and interest
2 932 880
2 217 985
Cost of services and borrowings
(877 645)
(711 019)
2 055 235
1 506 966
Distribution of wealth
Employees
528 729
26%
432 020
29%
Government
Taxes and levies¹
564 795
27%
436 318
29%
Shareholders
437 643
21%
375 553
25%
Non-controlling interests²
244 815
12%
179 247
12%
External shareholders
192 828
9%
196 306
13%
Reinvestment
524 068
26%
263 075
17%
2 055 235 100%
1 506 966
100%
Value added distribution over five years (%)
2015
2014
2013
2012
2011
Employees
26
29
32
33
31
Government
27
29
29
21
23
Shareholders
21
25
18
20
21
Reinvestment
26
17
21
26
25
100
100
100
100
100
For The Year Ended 31 March
I am pleased to report back to shareholders on a successful year for
the Peregrine Group. The coming to fruition of several longer term
strategic initiatives, combined with conducive market conditions,
created the opportunity for the Group to attain several milestones,
both in terms of record earnings and an improved level of
diversification across its earnings streams. The Group’s
owner-manager culture has, since inception, resulted in an entrepreneurial
and opportunistic ethos, with an ability to generate outsize cashflows
from performance fees and proprietary profits. Strategic initiatives
introduced over time and aimed at improving the Group’s earnings
sustainability are now bearing fruit. These include the imperative to
grow the annuity earnings base within each underlying business and
the drive to lower individual business risk and key man dependency
by diversifying the earnings mix through the acquisition of new
businesses. A successful move into the corporate advisory space
through the acquisition of a stake in Java Capital, during the year
under review, is an example of the continuing drive in this direction.
In addition, the move to diversify the Group’s earnings, from a
currency perspective, by the acquisition of an interest in the Stenham
Group a number of years ago has benefitted earnings in the year
under review.
Macro conditions, whilst uncertain and volatile, provided a
background against which the Group was able to generate sound
investment returns in a number of businesses and outstanding
returns within its hedge fund business. The spur to markets resulting
from easy monetary policy by the major central banks around the
world, prior to the year under review, was tempered by the onset
of the US Fed tapering its quantitative easing programme and the
anticipation of the commencement of the rise in US interest rates.
This anticipation of a tightening by the Fed had the effect of raising
appetite for developed market securities and dampening appetite for
emerging markets. It also served to substantially weaken emerging
market currencies, the Rand included. Notwithstanding the pressure
on emerging markets, the depreciation of the Rand had the effect of
propping up the JSE and also served to boost Peregrine’s earnings
from offshore.
The year of record profitability is reflected in the Peregrine share
price, which reached record highs post the release of these results.
Whilst it is the board’s responsibility to report back on the wellbeing
of the business rather than on the share price, it is an interesting
exercise to contrast the size of the Peregrine business today with that
which existed when the share price was previously at these levels 17
years ago.
In August 1998, two months after the Group’s listing, the share price
traded at a high of R29.00, the Group boasted a mere R7.7 million of
historic earnings and employed only 40 people. Group assets under
management stood at under R50 million at the time. Whilst the Group
had a number of subsidiaries at the time, the broking and structuring
business was the one principal earnings contributor. Ironically and
astoundingly the market capitalisation of the company at that time
was close to that of the Group prior to the release of these results.
Today, the Group has over 650 employees, generates R534 million
of historic headline earnings and manages assets in excess of R90
billion. The Group’s earnings now come from five diversified earning
streams, including a large percentage from offshore. From an historic
PE back in 1998 of over 500 times, the Group’s historic PE is now in
the low teens – at the same share price. As a board we certainly feel
a lot more comfortable at the current valuation.
It is thanks to the loyalty of our clients, the ongoing efforts of our
committed employees, the management teams within each of the
businesses and the executives at the Holdings level, that the Group
finds itself in a strong position going into the ensuing financial year.
We have no net gearing on our balance sheet, suitable levels of
free cash available coupled with substantial investments in group
proprietary assets and a pleasing and improving level of annuity
earnings with the potential to augment this as a result of substantial
performance-fee earning capacity, returns on proprietary capital
invested and an abundance of transactional activities.
It remains for me to thank my fellow directors for their sage input over
many years in helping to shape the framework in which so many
talented and passionate people, who call Peregrine home, have the
opportunity to do what they love and do best.
Sean Melnick
The financial year to 31 March 2015 was characterised by relative
weakness in global emerging markets and most notably by US Dollar
strength against a basket of emerging and developed world currencies.
US stock markets also outperformed during the fiscal year with the S&P
500 finishing the period up 10.44%, while the MSCI Emerging Market
Index was down by 2.02%.
Locally the South African market continued the strong returns of the
previous five years, with the JSE All Share Total Return Index up
12.53% for the period in Rand terms, although much of the growth
came from the Rand hedge stocks, which benefitted from the
signifi-cant 15.4% weakening of the local currency against the US Dollar from
10.52 in early April to 12.14 at the end of the financial year.
Significantly, the weakest currency over the period was certainly not the
Rand. The Euro slipped 28.4% against the greenback during the year
and the Rand appreciated by 10% against the European currency. US
Dollar strength and further concerns regarding China led to the weakest
performance for commodities in more than 10 years, with the local
RESI20 Index down more than 25% over the 12 month period.
The environment was beneficial for all Group businesses as Rand
weakness and reasonably strong stock markets helped Stenham and
Citadel to some extent, increased market volumes and some volatility
particularly in the latter part of the year suited the Securities operations
and the disparity of inter-sector returns benefitted the stock pickers
and helped create the environment for Peregrine Capital to deliver
their strongest fund returns in 15 years. All of these factors enabled the
Group to build on the extraordinary finish to the previous fiscal year
and resulted in the delivery of the strongest set of annual results in the
Group’s history.
The year under review was characterised by significant corporate
activity for the Group. Our shareholding in Stenham, our offshore asset
management and fiduciary business, increased by 10% and Citadel
acquired a further 30% of the Wealth Corporation, which became a
wholly owned subsidiary within our wealth management cluster. Within
Stenham, two major transactions were executed during the period with
the purchase of 100% of Cannon Trustees by Stenham Fiduciary and
the sale of Stenham Property into the listed entity, Stenprop. Finally, the
conclusion of a transaction to purchase 50% of one of South Africa’s
leading independent corporate finance businesses, Java Capital,
intro-duced a new, exciting advisory segment into the Group operations.
Regulation continues to play a major role within all financial services
businesses and while this requires us to spend appreciable time and
resources ensuring that we meet all of our legislative requirements,
it also has the benefit of raising the barriers to entry that exist within
many of our subsidiaries. In the current year, we have been fortunate to
see the implementation of the regulations that govern the local
alterna-tive asset management industry, in which a number of our core entities
operate, opening the door to meaningful potential growth opportunities
in the future.
FINANCIAL RESULTS
The Peregrine Group produced a record set of results under positive
trading conditions for the twelve months ended 31 March 2015. All
op-erating subsidiaries performed well with Peregrine Capital in particular
producing excellent results. The results were further characterised by
robust annuity revenue flows and strong returns on proprietary
invest-ments. The contribution across all business segments highlighted the
diversified nature of earnings in the Group. In addition, there were
pleasing additions to earnings from the newly acquired businesses of
Java Capital and Cannon Trustees.
The Group produced normalised headline earnings, after stripping out
an IFRS related share based payment charge anomaly, of R560 million
which was 42% higher than the previous year, while normalised
head-line earnings per share increased by 36% to 270.1 cents per share.
The net capital gain of R118 million made on the disposal of Stenham
Property to Stenprop resulted in normalised basic earnings attributable
to shareholders increasing by 70% to R676 million. A good indication
of the cash profits of the underlying businesses is that total profit before
tax, capital items and non-cash items, adjusted for total minorities,
amounted to R622 million. The Group increased its ordinary dividend
by 50% to 150 cents per share.
The operational review on pages 22-34 contains details of the
perfor-mance of our various subsidiaries for the financial year.
TRANSFORMATION
In pursuit of the Group’s transformation objectives, Peregrine has
con-tinued to make progress in the areas of ownership, enterprise
develop-ment, procurement and corporate social investment. Our commitment
to philanthropy has been embodied in the creation of our donor advised
fund housed within our Citadel Philanthropy Foundation.
CHIEF EXECUTIVE
OFFICER’S REPORT
Peregrine’s broad-based empowerment partner, Nala, which owns
20% of the Group’s South African operations, has beneficiaries which
include an education trust, a social development trust as well as
Peregrine staff. During the period Nala managed to continue to accrue
significant financial benefits as a result of the strong performance of
the Group’s South African subsidiaries and Nala’s other investment
holdings. In addition to benefiting existing employees, this should
sig-nificantly impact on the ability of the Group to attract and retain senior
skilled empowerment executives with specific skills that are required
within the businesses.
During the period under review several of our South African businesses
were independently rated and received recognition as level 5
contribut-ing enterprises. Peregrine remains committed to meetcontribut-ing
transforma-tion targets throughout our South African subsidiaries.
GOVERNANCE
Peregrine monitors and reports on compliance as set out in the King
III report and continues to remain fully committed to transparent and
disciplined governance processes. In addition, our risk management
processes remain robust throughout the Group and integrate the
func-tions of risk, internal audit and legal and compliance. Special attention
is given to the operational risk areas within the Group and, where
ap-propriate, dedicated subsidiary risk committees exist.
PROSPECTS
During the year we enjoyed the benefits of the operational gearing that
exists within many of our subsidiaries and, in line with the stated
strat-egy to grow sustainable earnings, the continued improvement in the
quantum and quality of our annuity earnings was once again pleasing.
Despite weakening global markets and the more volatile environment
that lies ahead, I am confident regarding the long-term wellbeing of
our business. While strong markets provide a tailwind to several of our
business segments, increased turmoil helps our trading and derivative
operations and presents an opportunity to hedge fund asset
manage-ment investors like ourselves. We pride ourselves in attracting and
retaining the best talent across all areas of our business and our
owner-managed culture has ensured that we have built industry leading
busi-nesses across the Group that reward performance and strive to keep
costs under control in the pursuit of long term sustainable profitability.
We remain committed to organic growth within our businesses and will
continue to build on the successes that we have achieved in driving
cross business revenue synergies. We will also seek to expand through
appropriate transactions which involve entrepreneurial management
teams running entities that not only complement our existing
business-es, but have the ability to be market leaders in their own right.
APPRECIATION
In a business that has the advantage of limited requirements for fixed
assets or working capital it is critical to remember that our people
will always be our most important asset. Our outstanding employees
deserve particular mention during another year of success. It is our
clients, however, of whom we are most appreciative. They have trusted
us, given us continued support and allowed us to work with them to
achieve their goals. I would also like to express my thanks to my fellow
executive directors who have worked side by side in partnership with
me and to the board of directors for imparting their knowledge and
experience during the year.
Jonathan Hertz
Executive
Jonathan Hertz
Chief Executive Officer
Robert Katz
Chief Financial Officer
Mandy Yachad
Executive Director
Non-Executive
Sean Melnick
Chairman
Pauline Goetsch
Non-Executive Director
Independent Non-Executive
Advocate Leonard Harris
Lead Independent Non-Executive Director
Clive Beaver
Independent Non-Executive Director
Steven Stein
Independent Non-Executive Director
Stefaan Sithole
Independent Non-Executive Director
DIRECTORATE
Prior to joining the Peregrine Group on
1 October 1999, Mandy practised at
Werksmans Attorneys for 14,5 years,
the last nine years as a partner in the
commercial department. After being
an invitee to board meetings since
February 2003, he was appointed as
an executive director to the board in
November 2010. Mandy’s responsibilities
include head of internal corporate finance
and general legal functions within the
Peregrine Group and he is also the
designated representative of the
Company Secretary.
Rob served articles at Ernst & Young
after which he served as Group financial
director of Educor Limited. He then
joined Standard Bank and was employed
in various senior executive positions
including global chief financial officer
for Personal and Business Banking,
managing director of the wealth division
and managing director of Home Loans.
Rob was appointed as Chief Financial
Officer of Peregrine with effect from 1
March 2010.
After qualifying as an actuary, Jonathan
was appointed managing director of
Safrican, a leading low cost insurer in
South Africa before joining Peregrine
in 2000 as Chief Operating Officer. In
2006, Jonathan co-founded Caveo Fund
Solutions, a fund of hedge fund business,
as a joint venture between Peregrine
and Investment Solutions. In May 2008,
he founded South Africa Alpha Capital
Management, a Bermuda domiciled
investment management business
housing the US Dollar class of several
of the leading hedge funds trading in
Sub-Saharan African securities. He
re-joined Peregrine in April 2013 as Chief
Executive Officer.
Sean Melnick (46)
Non-Executive Chairman
BCom (Hons) (Wits), CFASean is a founder and currently
Non-Executive Chairman of Peregrine
Holdings Limited. He is also Chairman of
Stenham Limited, Peregrine’s international
subsidiary. Sean has been primarily
responsible for and integrally involved in
the Peregrine Group’s expansion strategy
from inception. Sean began his career at
Liberty Asset Management in 1992, where
he headed up the Group’s derivatives
desk and was a senior portfolio manager
before joining the derivative trading and
structuring desk at Investec Bank Limited
in 1995. Sean left Investec Bank in 1996
to co-found Peregrine, took on the role
of Group Chief Executive Officer in 1997
and led the group to its successful listing
on the JSE in June 1998. Sean has spent
a cumulative 11 years in the position of
Peregrine Group Chief Executive Officer,
and a further seven years as either deputy
Chairman or Chairman.
Pauline Goetsch (46)
Non-Executive Director
BCom (Wits), BAcc (Wits), CA(SA), Dip Banking Law (RAU), CFA
After qualifying as a Chartered Accountant,
Pauline joined the risk management
division of Investec Merchant Bank Limited
in 1995, where she was responsible for
the evaluation of operations and price risk.
She joined Peregrine in July 1997 and
served as Group financial director from
2001 to February 2010. Pauline remained
as a non-executive director on the
Peregrine board following her resignation.
Pauline was a member of the management
team responsible for the establishment of
ApexHi UK Limited, the investment advisor
to the ApexHi Property Fund Limited, a
UK real estate investment trust (REIT)
which listed on the Channel Islands Stock
Exchange in August 2011. She served
as the managing director of ApexHi from
its establishment until the sale of the
company in October 2014. During that
time Pauline was involved, as promoter, in
the establishment and listing of GoGlobal
Properties Limited (‘GoGlobal’) and served
as the financial director of GoGlobal from
its establishment until April 2014.
Advocate Leonard Harris SC (53)
Lead Independent Non-Executive Director
BCom, LLB (Wits), MBA (Wits)Leonard is the Lead Independent
Non-Executive Director of Peregrine Holdings
and is currently in practice as a Senior
Counsel at the Johannesburg Bar. Prior
to commencing practice as an advocate,
from 1988 to 1991 he was employed by
Johannesburg Consolidated Investment
Company Limited in its Platinum Division
(now incorporated into Anglo American
Platinum Corporation Limited) where
he was involved in the financial and
legal structuring and implementation of
international operations. Leonard was
appointed to the Peregrine board in
2001 as a Non-Executive Director and
has served as the Group’s Non- Executive
Chairman from 2009 until 31 March 2014.
After qualifying at Whiteley Bros (a
predecessor firm to Deloitte & Touche),
Clive spent a brief period in industry,
some time with the Industrial Development
Corporation and then with a merchant
bank, prior to becoming a partner at
Deloitte & Touche in 1980. During his 25
years as a partner he served a wide range
of clients, including, since 1993, in the
financial services sector, during which
time he was fully involved in servicing
banks (merchant and retail), securities
traders, short-term insurers and unit
trusts. He chaired SAICA’s Stockbrokers
Interest Group for several years, was a
member of SAICA’s Short Term Insurance
Interest Group and SAICA’s Banking
Interest Group. He has also undertaken
special investigations on behalf of the SA
Reserve Bank and the JSE. Clive retired
as a senior partner of Deloitte & Touche’s
Financial Services Team on 31 December
2004 and remains a member of SAICA
and the Institute of Directors. Clive was
appointed to the Peregrine board on 3
January 2005.
Steven fulfils the role of chairman
of Peregrine’s Audit and Risk and
Compliance Committees and has been
a member of the Peregrine board since
2007. Steven spent 15 years as a
senior partner in a firm of South African
Chartered Accountants. In March 2002
Steven co-founded SwissIndependent
Trustees, an Offshore Trust Company
operating in Switzerland, Malta, Panama
and South Africa. He maintains his
role as Chief Executive Officer of
SwissIndependent Trustees and has an
active role with numerous global clients
and interfaces with global regulators and
tax administrations. Steven has broad
investment banking, private equity and
corporate governance experience and
holds a variety of leadership and advisory
roles on boards of public and private
companies.
(University of Natal), CIA
In 1991 Stefaan qualified as a Chartered
Accountant after serving articles with
Deloitte Haskins and Sell. He then
joined Anglo American Corporation as
an Internal Auditor for the period of
three years. He was recruited by SAB
Beer Division for an executive financial
position, Stefaan served as a Financial
Manager at the Rosslyn Brewery from
1992 to 1994. In 1995, he became a
partner in a multi-national auditing firm,
which was renamed Fisher Hoffman
Sithole. In 2001 he became a partner
at Sithole Incorporated and since 2002
he has been the managing partner of
both Sithole Incorporated and Sithole
SS Group. Stefaan continues to serve,
as chairman and member of numerous
private and public sector Audit Committees
as well as trustee to various entities. His
relationship with Peregrine commenced in
November 2006 when he became trustee
of Peregrine’s three empowerment trusts
and was later appointed to the board of
Nala Empowerment Investment Company
and Peregrine SA Holdings, positions from
which he resigned when he was appointed
as a non-executive director of Peregrine
Holdings in October 2013.
Peregrine Capital is a long-established asset management company dedicated to only
managing hedge funds, which have delivered exceptional results.
Since inception in July 1998, Peregrine Capital has
consistently applied one investment philosophy and style but
three different investment strategies, namely Pure Hedge,
Performance and High Growth.
With assets under management of R4.6 billion, and a further
R178 million under advisory mandates, disciplined and
thorough research procedures have delivered sustained
high, risk-adjusted returns over the medium and long term,
which have been recognised by investors and the hedge
fund industry alike.
Being a member of the larger Peregrine group, where the
leadership culture promotes and supports entrepreneurial
business, has provided the ideal environment for Peregrine
PEREGRINE CAPITAL
Capital’s success story.
The combined wealth of experience of the 12-strong team
has truly set an example in the ever growing hedge fund
industry in South Africa.
In the complex landscape of investing, whether in bull or
bear markets, the Peregrine Capital suite of hedge funds
provide investors with the means to reduce portfolio risk,
increase returns and diversify their investments.
The portfolio managers are supported in the front office by three
analysts, Stephanus de Swardt, Simon Steyn and Justin Cousins.
In order for the investment team to focus on investment
performance, all non-investment related functions are managed
by the back office team under the lead of Tania Waller. This
includes a compliance officer, financial accountant, business
development manager and administrator.
With many collective years of investment and industry
experience, we believe that the challenging and stimulating
culture at the firm results in a strong, stable and motivated team.
Peregrine Capital has
three portfolio managers,
David Fraser, Tobie Lochner
and Jacques Conradie.
David Fraser
Tobie Lochner
OWNERSHIP,
STRATEGIES AND
PERFORMANCE
Closing AUM and return numbers as at 31 March 2015.
Peregrine Capital
Peregrine Holdings Limited 50%
Pure Hedge Strategy
Currency: ZAR AUM: R0.89bn Strategy: Market Neutral
Inception: July 1998 Annualised Net Return: 23.7%
Std Dev: 7.4%
High Growth Strategy
Currency: ZAR AUM: R1.70bn Strategy: Long-Short Equity
Inception: Feb 2000 Annualised Net Return: 30.8%
Std Dev: 11.0%
Performance Strategy
Currency: ZAR AUM: R1.93bn Strategy: Long-Short Equity
Inception: July 1998 Annualised Net Return: 29.8%
Std Dev: 12.9%
Dynamic Alpha Strategy
Currency: ZAR AUM: R0.12bn Strategy: Geared Market Neutral
Strategy inception: Dec 2014 Net Return since inception: 14.2%
Std Dev: 7.6%
High Growth
Offshore Portfolio
Currency: USD AUM: $14.74m Strategy: Long-Short Equity
Inception: Oct 2003 Annualised Net Return: 23.7%
Std Dev: 8.8%
Management 50%
Peregrine High Growth Strategy
(after fees)
MSCI EM (ZAR)
JSE ALSI
Annualised Return
30.8%
9.2%
15.8%
Annualised Volatility
11.0%
20.2%
18.2%
Sharpe Ratio
2.01
0.02
0.39
Times Money (since inception)
58.49
3.81
9.26
Rolling 12 Month Return
46.7%
12.7%
12.9%
Rolling 3 Year Return
33.3%
13.9%
18.7%
Rolling 5 Year Return
27.6%
9.9%
15.2%
6000 5000 4000 3000 2000 1000 0
Feb-00 Aug-00 Feb-01 Aug-01 Feb-02 Aug-02 Feb-03 Aug-03 Feb-04 Aug-04 Feb-05 Aug-05 Feb-06 Aug-06 Feb-07 Aug-07 Feb-08 Aug-08 Feb-09 Aug-09 Feb-10 Aug-10 Feb-1
1
Aug-1
1
Feb-12 Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15
Peregrine High Growth Strategy MSCI EM (ZAR)
JSE ALSI
Focus on Peregrine
High Growth Fund
Our high conviction strategy, the Peregrine High Growth Fund,
a long-short equity fund, has generated excellent returns since
inception 15 years ago. For example, R1 million invested in
the Peregrine High Growth Fund at inception in February 2000
would have grown to R58.5 million by 31 March 2015. The
fund delivered these returns with significantly less risk than the
overall market and with only one down year in the
fund’s history.
Exit at the right time
Correct position size agreed, then added to
the portfolio (Long or Short)
CEO/CFO meetings
Annual reports
Industry experts
Financial modelling
If decide against investing, then back to research
Continual monitoring of portfolio. Adjusting position sizing depending on price level
Agree to invest
Investable idea
Disciplined bottom up research
Idea generation
Portfolio managers debate investment fundamentals
and valuation prospects
We are focused on listed equity related instruments and employ
a bottom up stock selection process based on rigorous and
disciplined fundamental research drawing on experience of
covering the sectors and companies over many years. We find
companies that are trading at below what they are worth and
focus on both growth and value stocks.
We believe in constructing highly concentrated portfolios and
use our ability to detect investment opportunities early and
execute faster than our competitors.
Peregrine Capital looks to identify companies that will grow
their earnings consistently and target opportunities with low
sensitivity to the macro environment, as illustrated in the graphs
below.
We spend a lot of time on finding excellent management
teams and then back those teams to grow their businesses
consistently over time.
The objective of Peregrine Capital is to generate strong absolute
returns while maintaining capital stability in the funds.
Strong predictable earnings growth
Earnings driven by macro environment
Company Earnings
300 250 200 150 100 50 0Year 0 Year 1 Year 2 Year 3 Year 4 Worst case Base case Best case
Company Earnings
250 200 150 100 50 0 -50Year 0 Year 1 Year 2 Year 3 Year 4 Worst case
Base case Best case
PEREGRINE CAPITAL
Peregrine Capital is the Group’s flagship hedge fund manager and one of South Africa’s largest
dedicated hedge fund managers, with R4,6 billion assets under management and a further
R178 million under advisory mandates.
Since inception in July 1998, Peregrine Capital has consistently
delivered exceptional results across its suite of funds which
are managed with a primary focus on investing in listed equity
related instruments in South Africa, with opportunities being
sought in the large, mid and small cap stocks.
The company strives to deliver sustained high, risk-adjusted
returns over the medium-term by focusing on bottom up stock
selection and implementing disciplined and consistent research
procedures.
REVIEW OF OPERATIONS
The higher revenues experienced in 2015 resulted in Peregrine’s
share of profit increasing to R120 million (2014: R53 million).
The funds delivered exceptional performance on an absolute
basis. Peregrine Capital manages three different investment
strategies namely Pure Hedge, Performance and High Growth.
The 12 month returns to the end of March 2015 (after fees)
were noteworthy in absolute terms and on a risk-adjusted basis,
namely:
•
High Growth Strategy 46.66%
•
Performance Strategy 33.34%
•
Pure Hedge Strategy
24.76%
The JSE All Share Index returned 12.53% for the year on a total
return basis. The equity content of the hedge funds remained
conservative, with the following averages per strategy for the
period under review:
•
High Growth Strategy 60.69%
•
Performance Strategy 51.00%
•
Pure Hedge Strategy
17.60%
The asset base, including assets under advisory mandates, grew
by 30% to R4,8 billion, predominantly as a result of the returns
achieved.
The global economy has not yet returned to growth and asset
prices generally have been inflated by low interest rates, making
finding value in securities markets challenging in aggregate.
The South African economy remains weak and the possibility
of a short term improvement in economic conditions appears
remote. South Africa continues to lose jobs in the mining and
manufacturing sectors, but on the upside the unsecured lending
market is showing signs of having bottomed from a bad debt
experience perspective.
Despite short-term headwinds in South Africa, the team
continues to find investment opportunities within this
environment.
* Profit is represented before tax, reflecting amounts after minorities, before intangible amortisation and share-based payment cost.
Peregrine Capital
2015
2014
Revenue
R314 million
R153 million
Profit*
R120 million
R53 million
Assets under management
R4,6 billion
R3,2 billion
Assets under advisory mandate
R178 million
R491 million
behalf of approximately 7000 individuals and families.
Citadel is a specialist Wealth Management business that assists
clients to discover the true meaning of sustainable wealth.
This is achieved through providing specialist, holistic and
comprehensive integrated wealth solutions. These solutions
incorporate financial planning, retirement planning, asset and
investment management, risk planning, philanthropy solutions
and estate structuring for high net worth individuals and families.
Citadel’s offering is global: incorporating financial and investment
planning in all major currencies, comprehensive estate and
fiduciary planning including local and offshore trust advice
and international holding structures. Founded in 1993, Citadel
currently employs 408 people, including an advisory team of 186.
Its underlying investment philosophy is based on four key pillars:
•
asset allocation drives performance;
•
effective diversification reduces risk without
compromising returns;
•
a valuation sensitive approach to investing; and
•
the future is uncertain and will often surprise.
Citadel is deeply committed to serving its clients and providing
appropriate and individualised solutions for them. This
commitment is reflected in its continuing strong client retention
rate and increasing level of client investments.
REVIEW OF OPERATIONS
Despite strong growth in core annuity earnings, profits for the
year decreased by 9% to R218 million (2014: R240 million), with
earnings down primarily due to lower performance fees earned
in the third quarter of the year under review. Revenue increased
by 2% to R720 million (2014: R708 million) and whilst the
results were not as strong as 2014, the increase in assets under
management to R34,1 billion (2014: R30,8 billion) and gross
inflows of R3,6 billion, confirms the ongoing health of Citadel as a
well-positioned business with a great value proposition. Pleasing
results came from Peregrine FX where revenue increased by
50%.
Citadel increased its client retention rate to 98% (2014: 97%).
The business’ performance, in the face of a challenging economic
landscape, was pleasing with initiatives to refocus and elevate
its brand paying dividends. Citadel’s local and offshore portfolios
delivered positive returns and with the divergent performance
in the different asset classes being generally in line with
expectations. This has resulted in pleasing returns for their clients.
The research and development of new, innovative solutions was
successfully executed during the year, which has positioned the
business for further growth. The well diversified and broad offering
available ensures that advisors can meet their clients’ bespoke
investment objectives and needs, which contributes to the overall
client experience. The business continues to invest in its people
through dedicated training and mentoring.
Citadel continued to grow organically through trusted referrals,
acquisition and joint venture relationships. In short the overall
Citadel strategy can be summarised as follows:
•
seek out opportunities to participate in industry consolidation;
•
actively look to build the business through Independent
Financial Advisor acquisition and ‘joint ventures’ which will
provide client ‘rock pools’;
•
increase its national footprint through the establishment of
regional offices;
•
leveraging off the existing infrastructure of the business;
•
constant expansion of the investment solution and
enhancement of technology offerings;
•
growing the business through heightened brand awareness;
and
•
ongoing collaboration with Peregrine Group businesses when
appropriate and on a ‘best of breed’ basis.
Over the past year a number of the initiatives, based on the
above strategies, are bearing fruit and Citadel looks forward to
continuing that momentum into 2015/2016.
Citadel
2015
2014
Revenue
R720 million R708 million
Profit*
R218 million R240 million
Assets under management
R34,1 billion
R30,8 billion
* Profit is represented before tax, reflecting amounts after minorities, before intangible amortisation and share-based payment cost.
