Investment Gains Deliver Strong Full Year Result
Investment Gains Deliver Strong Full Year Result For Rangatira
Wellington investment company Rangatira today announced a full year profit after tax of $39.4 million, compared with $8.5 million last year, following gains on the sale of investments of $32.1 million.
The $32.1 million contribution resulted from Rangatira selling its 50% holding in Contract Resources, its direct holding in Xero Limited, and its investment in Greenfield. Rangatira still retains an indirect holding in Xero through Valar Ventures.
Directors have assessed the asset backing of Rangatira’s shares to be $11.20 at 31 March 2014, compared to $10.63 last year.
A final fully imputed dividend of 26¢ has been declared making the total dividend for the year 46¢ (last year 42¢). The dividend will be paid on 30 June 2014 and the share register will close for dividend purposes on 20 June 2014.
Rangatira’s chairman David Pilkington said, “The total shareholder return of 9.5% is further endorsement of Rangatira’s long term investment strategy. The company’s average after tax return over the past ten years has been 10.9%, well ahead of most investment funds and the NZSX50 Index.”
During the year Rangatira acquired a 12% stake in Magritek. Magritek is an advanced technology company founded by Sir Paul Callaghan that has become a world leading provider of compact, portable MRI and NMR systems. Rangatira also acquired a 35% holding in Wellington based Tuatara, one of New Zealand’s largest independent craft brewers. Rangatira has invested in two further technology companies including IkeGPS and Mesynthes. Rangatira has also invested in JAFCO, a US technology fund.
A number of Rangatira Group companies have being enhanced by strategic investments. These include Hellers’ acquisition of Goodman Fielder meats, Rainbows End’s new Stratosfear ride and Tuatara expanding its brewing capacity to meet strong customer demand.
Further investments sought
Rangatira currently has about $50 million of funds available for investment as opportunities become available.
Rangatira’s chief executive Ian Frame said, “We are actively looking to invest in well-managed New Zealand companies with strong growth potential that need additional capital to take them to the next stage.”
Rangatira has a longer investment timeframe than many private equity funds and prefers to be a cornerstone investor, co-investing with business owners and management. In some cases, it will do this alongside other like-minded investment companies and institutions.
“Rangatira’s investment strategy of ‘investing in business for growth’ has produced good and sustained returns over many years for its shareholders. This can be attributed to a diversified portfolio, conservative gearing and the active involvement of our directors and management in the governance of the companies in which we invest.” Ian Frame said.
David Pilkington said, “Rangatira has had a solid start to the new year, which is pleasing given the seasonal nature of the performance of many of our unlisted investments. Looking ahead, the company has a strong balance sheet and is well positioned to take advantage of market opportunities as they arise.”