3. 1.0 Executive Summary
CYGNET'S strategy will be to source investment funds from private funders.
CYGNET aims to operate in the commercial and industrial property sector.
Investor funds will be lodged in an investment account with Deloittes & Touche and KPMG.
CYGNET will source properties for development and re-investment and will operate the administration
account.
This is done on a call off from the Investment Account, and is subject to extensive viability and due diligence
checks and balances.
All profits and returns on sales will be held in a Distribution Account and paid to investors as per instructions
held.
Technological advancements also permit for other economically feasible distribution channels, such as
separately managed portfolios for large accounts.
4. 'Commercial property values will increase in a volatile
economy‘
The question that many investors are asking right now is how commercial real estate prices will react to a
renewed recession, increased inflationary pressures and low medium-term interest rates.
Based on property prices of well-let properties, as well as the outstanding performance of listed property, local
commercial real estate has performed well, even in a distressed economic environment.
This would suggest that real estate is more of a stagnation hedge rather than an inflation hedge.
Many commercial property sector experts are remarkably uniform in their assessments.
Upticks in inflation and increased vacancies will likely cause cap rates to increase slightly, a negative effect that
will be more or less offset by better fundamentals and therefore higher cash flows.
The net expected effect is that property prices will hold firm in the short term, and may even increase in certain
sectors such as well positioned retail and industrial properties.
Recent activity on the auction floors shows that investors are now chasing yields.
Commercial real estate is seen as one of the safest investments to park capital during volatile equity and
exchange rate environments.
We believe that there are seven main reasons why commercial real estate prices will hold for now, and certain
sectors will see price increases:
5. Reason #1
A Reserve Bank bias towards low interest rates: Over recent months, interest rates have held steady.
Investors know that in this environment interest rates will remain low and fixed-rate mortgage debt
remains reasonably priced.
Reason #2
Urbanization and the influx of people from other African states: Although urbanization certainly has its
critics, the upside is that economic development and open borders have bolstered the growth and
development of South African cities. Moreover, South Africa’s main metropolitan areas continue to
attract entrepreneurially minded migrants from neighboring countries and smaller provinces.
Reason #3
Uncertainty overhangs in the equities market: The broader equities market has been unpredictable.
Corporate profits have been stable and governance is strong. However, price-earnings (P/E) ratios have
fallen and the market is generally moving sideways. A large amount of uncertainty originates from three
major sources: commodity prices, the Rand and domestic politics.
Reason #4
The supply side has slowed: At one stage, there was great concern that we were building too many new
shopping
6. centers, office blocks and industrial centers. However, with localized exceptions, supply has moderated and
has slowed down in the medium term.
Reason #5
Momentum in listed properties flow: Looking at the strength of listed real estate, capital
is starting to flow towards selected commercial property.
Reason #6
Improved risk management: We believe that cap rate compression may be coming to
commercial real estate. It has previously come in the form of higher P/E ratios to the
broader equities, so why not real estate? In fact, there are very good financial economic
reasons for lower long-run cap rates (and they are not just related to lower interest
rates).
Reason #7
South African corporations are doing well: Despite the occasional bad results
from certain listed companies involved in construction and property development, our
local companies have done really well. Notwithstanding a recessionary environment
since late 2008, we have not seen one listed company go bust as we did a decade ago.
Auction Alliance Press Release
7. Transport corridors present the 'next big property
opportunities'
The next big opportunity in the property market would be along the transport corridors within cities and that
linked cities rather than in circular nodes, said Francois Viruly, a property consultant and professor at the
School of Construction Economics and Management at UCT.
This was already evident along all the transport nodes in all the metropolitan areas in South Africa, such as
around the Gautrain, he told an SA Property Owners' Association broker's forum last week.
Viruly said new cities would develop in South Africa and with urbanization there would be an additional 10
million people in Johannesburg, which would lead to an increased need for high density housing.
"This means the residential property market will start competing with the commercial property market for
space. There will be many more opportunities, especially on the outskirts of the central business districts, and
double storey shacks because land will become more valuable as property prices increase.“
Viruly said the increased population in cities would lead to bigger retail centers and new opportunities, adding
the property market environment in the next 10 to 15 years would be one where public transport played a role
in providing commercial property opportunities and Chinese investors moved into the market.
He said the property market now played a more prominent role in the country's economic policy and the
Reserve Bank was paying more attention to this market because it did not want to see another boom.
However, Viruly said in the longer term there would be important structural changes in the market with the
commercial and residential markets competing more for space.
Viruly said much work had been done on social housing in central business districts by converting vacant
offices into residential but the prices were now too high for the market.
He anticipated old industrial estates would be the focus for residential opportunities.
Viruly said a slowdown in the economy made it extremely difficult for the commercial property market to
perform because tenants could not afford higher rentals.
8. He said there was a very clear correlation between the economy and the property market, adding that the
moment the economy "kicks up 1 percent" it increased property market returns by 3 percent.
However, he said the property market only started moving again after four consecutive quarters of economic
growth.
Viruly said the South African property market had a natural vacancy rate of between 7 percent and 8 percent
and at the moment vacancies were above this level, which meant rental increases would not beat inflation.
Viruly expected rentals to start exceeding inflation from the third quarter of 2013 and an increase in
construction from next year onwards.
Viruly said brokers should not expect to do many deals involving new developments because the property
market was still in the cycle of mopping up vacant space.
Big new developments, such as major office towers, would not come to market until 2014, 2015 and beyond.
Business Report
“The Case for Whole Stock Portfolios." One of the underlying tenets is that specialization within equity
portfolio management has gone too far; thus resulting in sub-optimal portfolios.
CYGNET is structured as a close corporation designed to capitalize on industry research performed by one
of the founding members, Sagren Pillay. The team presents this business plan as a "start from scratch"
outline of what a successful property portfolio management organization should look like as the industry
evolves in response to political, social, technological, and global sentiment.
CYGNET will offer high net worth investors’ opportunity to maximize profits and capital growth elements in
exchange for contributions to Cygnet's operating capital and for providing seed funds to establish the
investment products described herein. This document alone does not constitute an offer of any type, nor
does it provide any guarantee, financial, or otherwise. Risks associated with the CYGNET FINANCIAL
SERVICES business plan are not limited to those detailed in this document.
10. 1.1 Company Summary
CYGNET FINANCIAL SERVICES is structured as a Close Corporation, incorporated in the Republic of South
Africa.
It has been designed to capitalize on property industry research performed by one of the founding
members, Sagren Pillay.
This company is unique because it differs substantially from the way most existing investment
management firms operate.
Many of the firms created in the last 15 years were started by the departure of portfolio managers from the
country's largest banks, insurance companies, and brokerage firms.
Generally, these individuals were deep in investment management but novice as it concerns the business
and operating side of running an organization.
The investment plan for CYGNET is different.
CYGNET has been founded by managers and entrepreneurs with in-depth knowledge of all aspects
concerning property investment organizations.
Professional talent will be acquired and retained by offering key individuals and professional service
companies’ competitive compensation to include equity stakes.
11. 2.0 Investment Philosophy
CYGNET believes the goal of South African property portfolios should be to outperform the broad market, as
measured by the JSE Index.
Exposure to economic sectors will roughly approximate those of the benchmark.
Our view is that any deviation from the benchmark represents a bet, or in our case, a calculated risk that
will determine over or under performance.
Portfolios will also maintain market cap exposure to large cap (>R400 million), mid cap (R100 million to
R400 million), and small cap (<R 100 million) properties.
Like weightings to economic sectors, the weight of the portfolio allocated to large, medium, or small
properties represents a bet relative to the benchmark.
On average, our portfolios will hold roughly 1/3 of their value in large cap assets, and 2/3 of their value in
mid and small cap assets.
This distribution among capitalization ranges represents a modest bet that mid and small cap assets will
outperform, consistent with studies showing small property portfolios outperform larger property portfolios
in the long run.
12. We believe our process will be successful in the future
for the following reasons:
1.It provides the opportunity to outperform the market without taking undue risks, whilst having
ownership.
2.It does not concentrate heavily in a narrow segment of the market (e.g. residential, agricultural), thus
portfolios are more likely to maintain a stable performance base when certain areas rotate out of favor
and prompt redemptions.
3.It simplifies investor's portfolios by reducing the number of managers or funds they need in their overall
property allocation.
4.As in most cases, investment opportunity at ground level (development projects) will generally allow
the investor a far greater return on their investment in a shorter period.
5.Capital growth is taxed at lower rates than normal profits.
The decision-making process is one of consensus. The portfolio management team meets weekly to
discuss the portfolio and any changes to it. In rare cases, if we fail to reach a consensus decision, the
CEO will act as the arbiter, usually prompting for additional research, but if necessary, providing a final
decision. Our investment model is one in which portfolio managers are also analysts. This concept of
portfolio managers/analysts making decisions on a team was recognized and adopted for its proven
success in a few select firms that have been extremely successful from both an investment and business
perspective. Portfolio manager/analyst responsibilities include idea generation, due diligence, and
completion of research projects directed by the CEO. While each portfolio manager/analyst has
experience in various areas, they are generalists in the sense that they are not assigned specific sector
responsibilities. We find this allows individuals to remain stimulated by their jobs.
13. Professional project teams of Architects, Engineers and
Construction Companies will be utilized to ensure
compliance and comprehensive project analysis.
14. Listed property outshines all share for a sixth month
Listed property last month posted higher returns than the JSE all share index for the sixth consecutive month
but was overshadowed by the performance of the bond market.
The Property Loan Stock Association of SA (PLSA) reported yesterday that the listed property sector achieved
an overall monthly return of 2.6 percent last month, which was up from the 1.4 percent return achieved in
July.
By comparison, the all share index last month achieved a return of minus 1.8 percent. However, the all bond
index reported a 7.4 percent return in August.
Property loan stocks, which form part of the listed property sector, posted a return of 2.5 percent last month
compared with 1.3 percent in July.
There has been a steady resurgence of listed property prices since March after losing 7 percent in total
returns between January and mid-March due to the negative impact of inflationary risks at the beginning of
the year on all interest-rate sensitive asset classes.
Norbert Sasse, the chairman of the PLSA, said the returns of listed property overall easily outpaced inflation,
which meant the sector was a good hedge against inflation.
Sasse, who is the chief executive of Growthpoint Properties, said the listed property sector was fast
approaching R140 billion in market capitalization and the PLSA expected the sector to continue growing in the
long term.
The highest return in the listed property sector last month was achieved by property loan stock Fortress B,
with a return of 17.6 percent. It also posted the best year-to-date performance to last month, with a 51.5
percent return.
15. Two other loan stocks, Acucap and Fortress A, are achieving double-digit returns for the year to date.
Keillen Ndlovu, the head of property funds for Stanlib, said in a blog for the PLSA website that eight listed
property companies, representing about 60 percent of the listed property sector on the JSE, released
annual financial results last month and posted a weighted average income growth of 6.8 percent.
Ndlovu said this was not bad compared with the average inflation rate of 4 percent, although there were
some notable disappointments, such as Hyprop's lower-than-expected income growth and Emira
forecasting negative income growth
.
He added that there was a general downward trend in overall vacancies across the portfolios reporting and
the retail sector, especially the larger shopping centre’s, continued to do better than other sectors.
"The retail sector, and particularly bigger shopping centers, continues to outperform the office and
hospitality sectors, which are still feeling the effects of a weaker economy and oversupply," he said.
However, Ndlovu stressed there were still some major risks to note and at macro level, slower economic
growth and rising bond yields were a concern for asset managers, while steep increases in operating costs,
particularly utilities and taxes, were making it difficult for landlords to negotiate better rentals with
tenants.
Ndlovu said Stanlib was forecasting a slowdown in income growth to about 5.5 percent for the coming year
with an 8.4 percent forward yield for the listed property sector, which was likely to be better than cash and
bonds.
Business Report
16. 3.0 Market Analysis Summary
Much of our analysis focuses on the commercial and industrial segment of the property investment
industry because it is such a large component of the overall landscape. We have additionally provided
information as it pertains to the management of separately managed portfolios (i.e. "separate
accounts"). To understand the data here, one must understand that separate account managers must
register their firms with the FSB. Thus, they are known as "Financial Service Providers." For CYGNET, the
technologies we have selected will enable us to capitalize by utilizing both product types.
Our analysis supports the 10% to 12% projected capital growth rates by outside sources. Profits on
development projects can be as high as 26%, with rental portfolios returning 8, 5% per annum.
Probably the most important aspect to these projections is the factors that will fuel these rates of
growth. The following section contains some of the key variables to creating this growth environment.
Medium cost housing projects are also viable investments in the three to five year term.
All are expected to have a positive impact on the investment industry for at least the next five to
ten years.
17. Government asks private sector's help with housing
Human Settlements Minister Tokyo Sexwale has made a plea to businesses, individual stakeholders, private
sector institutions and donor agencies to "go the extra mile" and assist the government in reducing the
housing backlog to prevent social unrest erupting.
The Department of Human Settlements was unable to address the burden of the housing backlog on its
own, Sexwale said at the launch of the "Each One Settle One" campaign at the JSE yesterday.
The campaign aims to mobilize various stakeholders, including the top 200 JSE-listed companies, to assist
the department in providing decent shelter to more than 2 million households living in squatter camps, as
well as in informal settlements.
Sexwale said the number of informal settlements in the country had grown from 800 when he was Gauteng
premier to 2 500 today.
The housing backlog under his watch had increased from 2.1 million houses when he became minister to
2.3 million, despite his department building 200 000 houses a year.
Sexwale attributed this situation to the increasing number of households and the decrease in the size of
households, admitting that the government had got itself into "a very tight situation since 1994" by
providing free houses for the poor.
"It was not the best thing to do. We can't provide free housing forever but we have got to do that because
we can't turn our backs against the poor. It's not their fault they are in that situation," Sexwale said.
He stressed that the new campaign was not aimed at bringing all corporate social investment involving
housing under one umbrella.
18. The government knew about the social investment by corporates. The campaign was aimed at telling corporates
"what is not happening".
"We have to go the extra mile. Something else has to be done. We need all hands on deck," he said.
Sexwale warned that if there was a second recession in the country it would introduce social instability.
"The protests of our people are beginning to get violent every day. It's worrying. The police are shooting every
day.
Let's work together to try and stem the tide.“
Sexwale said housing was not just a social expenditure item but an economic dynamo because it contributed
massively to economic growth.
"It stimulates the whole financial system and when it doesn't happen, the world starts burning and we just
don't know where it ends.“
He said it was easy for firms to hide behind corporate social investment but it would "not keep this problem at
bay".
A social investment desk had been created in the department to manage the activities of the campaign and
projects on a project-by-project basis.
Khanyisile Kweyama, the executive head of human resources at Anglo American Platinum, said it embraced the
campaign and was contributing R1.4 billion towards facilitating the building of 20 000 houses for its employees
over the next 10 years.
Leon van Schalkwyk, the group executive of strategic finance at Impala Platinum, said it had a proven track
record in community-based housing solutions through its extensive home ownership programme in the North
West to uplift its employees, which had resulted in the construction of more than 1 500 freestanding units over
a three-year period.
It therefore made perfect business sense to get involved in this campaign, he said.
19. Business Report
4.0 Strategy and Implementation Summary
The key to managing an asset portfolio is to develop a successful profile, develop a pattern of success, and show
that pattern can be repeated in the future. After which time, successful products should be aggressively marketed if
capacity to manage additional assets exists. While a three to five-year period may seem like millennia compared to
the technology world, it is really quite reasonable considering the fact that private equity investors in limited
partnership vehicles are generally satisfied with a 10-year waiting period that exists prior to a return of their capital
investment. Based on the developmental timeline associated with investment products, this plan provides a financial
outline of CYGNET'S funding targets for the first few years of operations. We will focus chiefly on Mixed Use Projects.
4.1 Competitive Edge
''Companies are nothing but men and women and their work. That which comes forth from a company is only as
fine as the effort put into it.''
''A customer is a person who brings us his wants-it is our job to fulfill those wants.''
The above quotes reflect the philosophy and ethos of CYGNET. Only by fine effort and effective control will we
accomplish and attain our goals and those of our investors.
CYGNET will centralize and standardize all property management systems, controls, responsibilities and personnel.
Unlike other investment companies who generalize and pay dividends to all clients in their portfolios, we will strive
to manage each client on a personal basis, and to maximize returns for each and every client.
4.2 Marketing Strategy
CYGNET is based in Kwa-Zulu Natal and has excellent local knowledge of markets, trends and development
nodes in the region. Our initial focus will be to invest locally, before expanding into other regions. This will only
be done via thorough market analysis and project planning.
We will utilize our website to find investment properties and opportunities, as well as to market our portfolios.
We are registered with the Debt Control Council. The Estate Agency Affairs Board (EAB79202/L) and with the
Financial Services Board (FSP No. 43587) to ensure legal compliance.
We will charge an Administration Fee to our clients based on investment levels. Fees will approximate 2% of
investment returns.
20.
21. 4.3 Sales Strategy
Cygnet's property investment portfolio will be initially offered through an FSB registered administration fund.
Technological advancements also permit for other economically feasible distribution channels such as
separately managed portfolios for large account sizes.
Based on our large, medium and small cap projects, revenue streams will be continuous from year 3. Ideally,
clients should look to invest in the medium to long term to maximize profitability and returns.
CYGNET generates its revenue from Administration Fees for services rendered on behalf of its clients.
The chart and table below provide a more detailed look at our projected sales strategy.
4.4 Milestones
CYGNET will strive to have projects in place and capitalization of R 2, 3 billion by 2015.
This is a bold plan, but is highly achievable given the available projects and infrastructural changes that are
being effected in South Africa.
We have attached Large, Medium and Small Cap targets as per our initial market analysis.
22. Table: Milestones
Milestones
Milestone Start Date End Date Budget Manager Department
Large Cap 2012/01/01 2015/01/01 R400,000,000 SP Project
Large Cap 2013/01/01 2016/01/01 R400,000,000 SP Project
Large Cap 2014/01/01 2017/01/01 R400,000,000 SP Project
Med Cap 2012/01/01 2014/04/01 R250,000,000 SP Project
Med Cap 2013/06/01 2015/12/01 R250,000,000 DL Project
Med Cap 2014/03/01 2016/07/01 R250,000,000 SP Project
Small Cap 2012/01/01 2013/06/01 R100,000,000 DL Project
Small Cap 2012/06/01 2013/12/01 R100,000,000 DL Project
Small Cap 2013/07/01 2014/03/01 R100,000,000 DL Project
Small Cap 2014/03/01 2015/09/01 R100,000,000 DL Project
Totals R2,350,000,000
24. 5.0 Management Summary
CYGNET has compiled a management team, and will employ candidates for other key positions, should it be
required. We would prefer to use outside consultants and professional teams on a project basis, and
according to
each entities specific strengths.
Sagren Pillay is the managing member of the corporation. Sagren has been involved in company management
for
the past fifteen years. He is a member of the Debt Control Council of South Africa.
David Larkan is a registered and practicing accountant. David graduated and was articled with KPMG, prior to
going into private practice. He also holds a CEA qualification. David has been in the accounting profession for
the
past 22 years and in the property industry for seven years.
6.0 Financial Plan
The primary goal of the first full quarter of operation will be to secure funding from outside investors. Prior to
this
point, CYGNET has already set up the corporation and registering the firm and its products with the DCC.
The amount sought from investors will be approximately R 900 million, which should see the business through
to
profitability near the completion of the third year.
At no point will we spend 100% of investor funds on acquisition of assets. On new investments, typically,
after a
period of 8 months income will come on stream. We have planned net profit levels at 25% per annum.
25. Capital growth and profits will only be realized upon redemption of properties and sale of assets. This is done on
project completion.
There are a few items worthy of note as it pertains to our forecasts. Most likely, excess cash will be re-deployed
into the business once a level of sustainability in revenue has been achieved. The primary purpose of this type
of
reinvestment would focus on a "second stage" marketing plan to increase distribution.
A word of note is also warranted as it pertains to the cash flow statement. One appealing feature of the
investment industry is that collection of fees (i.e. revenues) is highly certain because fees are frequently
charged
directly to the client's accounts. For this reason, revenue certainty is very high and is directly related to the
amount of assets under management. Common practice in the investment management industry is to bill at
each
quarter-end. For example, our management fee of 1.50% would be applied to our clients' accounts four times
per
year at 0.35%.
Simply put, the economic motivation is great. Growth rates for the asset management industry are projected to
range from 20% to 25% in each of the next three years. The demographic, economic, political and social
evidence
supporting these projections make this one of the most attractive industries due to the high degree of certainty
in
the estimates. We believe the certainty coupled with the above average growth rate distinguishes this
opportunity
from other venture investments. Additionally, our conservative estimates outline a plan-to-profitability over a
period much shorter than typical venture investments that sometimes require up to ten years to harvest profits.
27. Cygnet Investment Proposal
1. INVESTORS 4. PROJECTS
Investor/s funds will be places into an interest CYGNET will manage the property investment
bearing investment account, held by KPMG / portfolio, as well as all legal matters, liaison with
Deloittes. developers, architects, contractors and
professional bodies. All costs in this regard are
covered by our management fee.
2. KPMG /Deloittes
KPMG /Deloittes hold funds on call in an
5. DISTRIBUTION ACCOUNT
investment account on behalf of the investor/s.
They will be responsible for all due diligence and Once sales commence and income is generated,
audit requirements on the Investment, Operating monies will be placed into the distribution
and Distribution Accounts. account. Investor is paid monthly, or as per
instruction. CYGNET is paid a management fee of
2% on a monthly basis. KPMG / Deloittes is paid
3. CYGNET a management fee of 1% on a monthly basis.
Cygnet will source properties and development These fees are added onto the prime interest
opportunities. Upon ratification by Investor and rate and charged to the development, or third
KPMG / Deloittes, funds placed into Operating party. The investor is paid at the prevailing
Accounts for purchase and development or interest rate of 7%.
investment into property. Our objective is to secure
a minimum of 15% equity stake on behalf of the
6. DISTRIBUTION OF PROFITS
Investor, which will secure further profit and capital
gains on completion of the projects. All profits on developments are paid into the
distribution account and distributed and paid
according to investor instructions. These profits
are in addition to the interest account and we
estimate these to be a minimum of 15%. These
profits are longer term investments and are
released on completion or sale of the project.
29. Expected Yield
Interest Equity Sales Capital
100
P
E
60 R
C
E
30 N
0 15 0 13 T
15 0 15 0 0
15 A
15
10 15 G
10
10 E
10
10
Year 1
Year 2
Year 3
Year 4
Year 5
30. Investment Cycle
OUT Investor IN
Investment Returns
Account Managers
Investment Account Distribution Account Operating Account
Cygnet
Project Sourcing Project Management
Projects
Capital Interest Equity Sales
31. Investor Hypothesis
Investor places investment funds of USD 100M, which are fully utilized in a development project.
Anticipated returns will be as follows:
USD
Interest – 10%per annum – 5 years 36,000,000
Sales – 100% sold year 5 – 15% 15,000,000
Capital gain – year 5 – 22% 87,000,000
Total Revenue 138,000,000
The above revenues are in addition to the repayment of capital investment at start-up.
Taxes and audits will be handled by the Account Managers.
Cygnet will source; check viability and track progress and proceeds of the specific developments, as well
as professional contractors, clients and related services.
32. Table: Financials
Beginning Balance
Opening Balance Cash & Checking R0 R203,000,000 R348,400,000
Plus Money Received
New Investment R900,000,000 R1,000,000,000 R1,100,000,000
New Loans R0 R0 R0
Sales R420,000,000 R500,000,000 R650,000,000
Other R0 R0 R0
Subtotal Money Received R1,320,000,000 R1,500,000,000 R1,750,000,000
Less Money Spent
Direct Costs
Direct Cost of Sales R316,000,000 R375,000,000 R487,500,000
Other Costs of Sales R0 R0 R0
Normal Operating Expenses
Payroll and Payroll Taxes, Benefits, Etc. R0 R0 R0
Rent and Utilities R0 R0 R0
Sales and Marketing Expenses R0 R0 R0
Administration Fees R6,000,000 R6,600,000 R7,200,000
Other Outflows
Payments of Taxes R20,000,000 R23,000,000 R28,000,000
Debt Payments R0 R0 R0
Purchase of Assets R775,000,000 R950,000,000 R1,150,000,000
Other R0 R0 R0
Subtotal Money Spent R1,117,000,000 R1,354,600,000 R1,672,700,000
Ending Balance
Ending Balance Cash and Checking R203,000,000 R348,400,000 R425,700,000
Profit Before Interest and Taxes
Sales R420,000,000 R500,000,000 R650,000,000
Less Cost of Sales (R316,000,000) (R375,000,000) (R487,500,000)
Gross Margin R104,000,000 R125,000,000 R162,500,000
Less Operating Expenses (R6,000,000) (R6,600,000) (R7,200,000)
Profit Before Interest and Taxes R98,000,000 R118,400,000 R155,300,000
Net Cash Flow R203,000,000 R145,400,000 R77,300,000
37. 6.1 Projected Cash Flow
The chart and table below highlight the cash flow statement for the company. It includes the anticipated
investment required in the first year. No dividends have been distributed. We would expect dividends to
be payable on completion of various projects, and subsequent sale and re-investment of funds into new
ventures, subject to investor requirements and instructions.
Chart: Cash