Grand Parade Investments (GPI), the investment holding company that is in the process of delisting from the JSE after 14 years, struck an optimistic tone as it heads into a new financial year.
Over the past two years, Covid-19-related restrictions hobbled its mainstay leisure and gaming assets. However, these businesses have been gaining momentum after the government lifted the remaining pandemic curbs.
GPI owns a 15.1% interest in SunWest, 15.1% in Golden Valley Casino, 30% in Sun Slots and two noncore properties.
“The gaming businesses have performed extremely well following the lifting of all Covid 19-related restrictions. Sun Slots, in particular, has been resilient to the tough trading restrictions and has surpassed pre-Covid-19 levels,” the company said on Friday after releasing its full-year results to end-September.
“We expect trading conditions to continue to improve over the second half of the calendar year as international travel improves which will assist the recovery of Grand West and the Table Bay Hotel.”
Founded in 1997 and listed on the JSE in 2008, GPI has had a chequered history on the markets, especially so over the past decade when it expanded into the highly competitive and overcrowded food market.
Its headline loss nearly halved to R13.7m year on year. The headline loss includes an impairment against the intercompany loan with loss-making Mac Brothers, the catering equipment business that was liquidated during the review period,
Gaming assets contributed R107.9m to headline earnings, which represented an increase of 48%, though this came off a low base.
GPI said all its gaming businesses have resumed dividend payments and were positioned to benefit from an improvement in trading conditions over the next financial year.
It is also looking to further unlock value for its shareholders through the potential sale of some of its existing businesses.
GPI managed to finally sell its struggling Burger King SA and Grand Foods Meat Plant in November 2021 after battling for months to find a suitable buyer, underscoring the competitive landscape of the fast-food market.
However, the close of the deal enabled GPI to cut debt and pay a special dividend during its half-year results in March.
It bought the Burger King SA franchise in 2013, but had struggled with it, and the R465m sale was almost derailed after competition authorities said it would dilute black ownership in the sector.
The decision prompted a wave of criticism and warnings that black-owned businesses would find it harder to sell their assets, while foreign investment would also be reduced.
GPI’s share price was up 3.67% to R3.11 in midafternoon trade on the JSE, valuing the company at R1.4bn. In 2014, it peaked at R6.30.
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