R123 million payday for South Africa’s richest man

South Africa’s richest man, Johann Rupert, has received a multi-million payout due to his shareholding in Remgro despite a challenging year for the group.

In its results for the year ended 30 June 2024, Remgro said that the 2024 financial year was challenging. Although some contributions from some of Remgro’s investee companies were noted, the company said that work needs to be done to stabilise the operations performance of several critical investments.

In the last financial year, the group highlighted some challenges faced in South Africa, such as high interest rates, the disruption of business operations due to load shedding, local infrastructure and logistics-related challenges due to geopolitical instability, and exchange rate volatility.

Some improvements were seen in the last financial year, such as a significant reduction in load shedding, a decline in fuel prices, and less political uncertainty following the national elections.

That said, the group’s results for the year did not meet expectations.

Headline earnings for the year decreased by 20% from R7.056 million to R5,647 million, while headline earnings per share (HEPS) decreased by 18.8% from 1,254 cents to 1,018 cents. The difference of 120 basis points in the HEPS and headline earnings reflects a share repurchase.

A major driver of the decline in headline earnings is the effect of corporate actions, many of which were non-recurring items. The negative impact of significant corporate actions implemented throughout technical group amounting to R766 million (2023: positive impact of R581 million).

The challenging operating environment, especially Heineken Beverages’ trading results, also contributed to the decline in headline earnings. Heineken Beverages contributed a R297 million loss, which was partly offset by a higher contribution from Capevin Holdings Proprietary Limited of R65 million.

Looking more positively, there were increased contributions from many investee companies, including RCL Foods Limited, TotalEnergies Marketing South Africa Proprietary Limited, OUTsurance Group Limited, Siqalo Foods Proprietary Limited and Air Products South Africa Proprietary Limited.

Big payday for Rupert

Despite the drop in headline earnings, the group upped its final dividend from 160 cents to 184 cents for the year after taking out of its income reserves.

The group thus increased its total gross dividend from 240 cents to 264 cents.

According to the group’s available information, Rupert, through Rupert Beleggings Proprietary Ltd, owns all 39 million+ unlisted B-shares in Remgro and approximately 7.5 million ordinary shares.

Rupert received a payout of R123 million from Remgro over the last year.

However, it should be noted that this barely dents Rupert’s overall wealth.

According to Forbes’s latest information, Rupert is worth $10.5 billion (R183.8 billion), with most of his wealth linked to luxury goods company Richemont.

Thus, the R123 million payout roughly reflects only 0.06% of Rupert’s wealth.

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