Our opinion on the current state of RMBH(RMH)
Rand Merchant Bank Holdings (RMH) is a company which used to own 34,1% of Firstrand and, since 2016, has been investing in property. RMBH was started 41 years ago by GT Ferriera, Laurie Dippenaar and Paul Harris and listed on the JSE in 1992 and split off and separately listed Rand Merchant Investment Holdings in 2011. RMH Property was formed with the acquisition of 27,5% of Atterbury, 34,1% of Propertuity and 40% of Genesis. After the sale of its 34% stake in FNB, RMH is now essentially a property company.
On 9th April 2021, the company announced a special dividend of 80c per share resulting from its failure to implement the Bucharest development. The company recently changed its financial year-end from March to September.
In its results for the year to 30th September 2024, the company reported negative revenue of R57m and a headline loss per share of 10,5c compared with a loss of 1,4c in the previous period. The company said, "Since June 2020, RMH has returned R3.557 billion in cash to shareholders through special dividends as part of its monetisation efforts. Notably, RMH’s market capitalisation on 24 June 2020 was R2.4 billion, demonstrating the effectiveness of its value realisation strategy. The combination of the cash distributions to shareholders and the current share price has yielded shareholders a return of 73% since 24 June 2020."
Technically, the share has been difficult to assess because of its recent divestments, but it has entered an upward trend. The share price remains well below the company's NAV, so we still think it represents good value at current levels.
The company's ongoing strategy of monetisation and its focus on property investments are likely to provide some long-term stability. However, the recent negative revenue and headline losses underline the challenges it faces in achieving sustainable profitability. Investors should watch for further developments in its property portfolio and any updates on its monetisation strategy to evaluate future prospects.
On 9th April 2021, the company announced a special dividend of 80c per share resulting from its failure to implement the Bucharest development. The company recently changed its financial year-end from March to September.
In its results for the year to 30th September 2024, the company reported negative revenue of R57m and a headline loss per share of 10,5c compared with a loss of 1,4c in the previous period. The company said, "Since June 2020, RMH has returned R3.557 billion in cash to shareholders through special dividends as part of its monetisation efforts. Notably, RMH’s market capitalisation on 24 June 2020 was R2.4 billion, demonstrating the effectiveness of its value realisation strategy. The combination of the cash distributions to shareholders and the current share price has yielded shareholders a return of 73% since 24 June 2020."
Technically, the share has been difficult to assess because of its recent divestments, but it has entered an upward trend. The share price remains well below the company's NAV, so we still think it represents good value at current levels.
The company's ongoing strategy of monetisation and its focus on property investments are likely to provide some long-term stability. However, the recent negative revenue and headline losses underline the challenges it faces in achieving sustainable profitability. Investors should watch for further developments in its property portfolio and any updates on its monetisation strategy to evaluate future prospects.
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