The funds generated by our operations constitute our financial capital inputs. These funds are used to run our business and to finance both expansion and investment into Research & Innovation. Our financial capital is reinvested in all the other four capitals in a considered manner to ensure the sustainability of our business. The targeted return on capital is an important consideration when making investment decisions.
Our transformation plan hinges on the vision of becoming the most valuable technology firm − this has a two-fold impact on our Financial Capital. We need to ensure that our valuation by investors are amongst the highest in the industry and that PAT as a percentage of revenue is increased to 20% in the long-term.
Net Profit Margin
The Net Profit Margin is the most important indicator of our Financial Capital as it reflects the competitive landscape of the technology sector that we are operating in. It is critical to our capacity to build our reserves and investment in Human, Intellectual, Technological and Relationship Capital which, together with our valuation multiple, defines the value of our company.
Gearing
Financial Discipline has always been one of our strategic orientations since we started the Company. Therefore, the gearing indicator has traditionally been very low at Anglo African, with debt mainly relating to short-term vehicle/ equipment leasing. This is also an important stock of capital for us as it would allow us to remain stable in an adverse or unforeseen event which might require additional unbudgeted funds.
Shareholders’ Funds
The Shareholders’ Funds is an important indicator of the Group’s financial health. The growth of our Shareholders’ Funds has been healthy over the last few years and, together with our strong Cash at Bank position, gives a strong image of the company towards our people, customers, regulators and strategic partners. We expect this fund to grow even further in the years to come.
