The Public Investment Corporation (PIC) said yesterday it had turned over a new leaf from its discoloured past as it posted a R208 billion, or 8.9%, growth in assets under management to R2.5 trillion for the 2021/22 financial period amid external challenges.
The PIC, said in its its integrated annual report for 2021/22, released yesterday, that the growth had been achieved despite external challenges in the operating environment. However, the value of the portfolio decreased.
The PIC said its portfolio endured the effects of Covid-19, a relatively tough economic environment, more intensely in the year under review, than in the previous financial year.
This saw the portfolio value decreased by 7.79% to R75.15bn due to impairments raised during the financial year. Disbursements for the year decreased by 60.52% to R2.25bn compared to the previous year.
Investee companies were supported throughout the pandemic, with payment holidays, extension of loan tenures and waivers of covenant breaches, it said. Limited capital injections were offered to some companies. These interventions are made on merit and on a case by case basis.
After a series of shuffling musical chairs at the executive helm the PIC is now lead by CEO Abel Sithole.
Sithole said public investors had been through the mill with investment's raising the ire of analysts, including the Steinhoff saga, which had realised losses of at least R28bn.
Investment losses without legal consequences were registered, among others, in the retail sector (R25bn-R31bn), MTN Nigeria (R1.8bn), Smile Telecoms Holdings (R1.2bn), African Bank (R4bn) and the industrial sector’s Afrisam, Tongaat Hulett and PPC (R8bn). Major construction companies such as Aveng, Group 5, WHBO and Murray & Roberts were all guilty of price fixing (R5bn).
Listed equities, which is PIC’s major asset class by percentage, delivered positive returns and contributed R1.227bn to the entire portfolio.
The PIC said it had made fewer unlisted investments during the year under review compared to the previous financial year.
The Government Employees Pension Fund (GEPF), who signed a review at the end of the financial year, had committed R25bn to unlisted investments. This would be deployed over the next five years in both South Africa and the rest of Africa.
The PIC’s portfolio is made up 86.78% of listed Investments comprising listed equities, bonds, cash and money markets and listed properties, while unlisted investments make up a paltry 4.57%, which constitutes private equity, impact investing and unlisted properties.
Offshore and Rest of Africa Investments at 8.69% made up of global listed equities, global listed bonds, Africa-listed investments and Africa-unlisted investments.