Established as an empowerment group in 1997, Grand Parade has a history as an investment holding company with gaming and leisure interests. The company is based in the Western Cape and represents a broad spectrum of shareholders in the province, being a bona fide B-BBEE enterprise. Beneficiaries are mainly members of marginalised communities in Cape Town, who started receiving healthy dividends after a few years.
Grand Parade has been trading on the Johannesburg Stock Exchange (JSE) since 2000. From humble beginnings, the company has today grown into a powerhouse in the tourism, leisure and gaming industries of South Africa, reflected by a growing Grand Parade share price.
One of the group’s pioneering achievements was the successful application as part of the SunWest International consortium to buy the Cape Metropole casino license in 1999. Beyond SunWest, the group holds equity in Golden Valley and the Sibaya Casino in Durban. In 2010, the group became an operator through the purchase of 100% of Limited Payout Slot Machine, which operates in the Western Cape, KZN, Gauteng and Mpumalanga. The group also operates the Burger King franchises in South Africa.
Grand Parade has a market cap of R1.7 billion.
Grand Parade Shares Growth Driver
Since inception, Grand Parade has achieved compounded growth of some 26% annually. The 2015 financial year proved to be a fruitful one, with the group achieving a headline earnings increase of 234% to R49.4 million, translating to an increase of 232% in headline earnings per share, up to 10.53 cents.
This good performance was largely driven by improved results from the group’s largest contributor SunWest, which enjoyed an 11.3% headline earnings gain to R117 million. GPI Slots also recorded impressive data with a 50% rise in profits to R70 million. .
Burger King recorded a loss of R55.1 million, but is expected to start producing profits after the initial start-up and expansion phase is complete. Against a backdrop of subdued consumer spending, the group has decided to buy into a five-year strategy which focused on optimising the business without inhibiting growth. In a bid to diversify the company, recent milestones included the acquisition of Mac Brothers Catering Equipment, and conclusion of an agreement to buy a stake in Australia-based gaming machine manufacturer Atlas Game Holdings.
Going forward, the group aims to accelerate growth across all spheres of business, pursuing diversification and healthy shareholder returns whilst improving the quality of assets, staff and processes.
Grand Parade Group Investor Tip
The live online stocks chart shows that Grand Parade share price has suffered a steep decline of late, dropping from R7.56 in 2015 to R3.48 in 2016. The group is reviewing its investment in Burger King, which is still making a loss in a highly competitive market.
The core businesses such as SunWest and GPI Slots are however continuing to perform well, and shareholders are continuing to enjoy dividends. This should sustain investor confidence to buy Grand Parade shares.
Grand Parade : How to buy Grand Parade Group Shares Online
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