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AfroCentric INTEGRATED ANNUAL REPORT 2016
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STRATEGY (continued)
COST CONSCIOUSNESS
A key pillar of the business model is access to quality and affordable healthcare. The Group cultivated a culture of
cost consciousness in the business and as a result, reduced healthcare costs for clients and their beneficiaries. The
Group actively pursued process optimisation and transitioned to an ideology of ‘fit for purpose’ in support of this
initiative.
Key performance indicators
− Reduction in cost base
− Percentage of operating expenses
− Gross profit percentage
− Percentage of profit after tax
ENHANCE SHAREHOLDER VALUE
One of the Group’s key objectives is the creation of sustainable value for shareholders. Prospects for organic
growth are limited as it is unlikely that further income can be derived from current members or funds. (Refer to
page 39 for commentary on the external environment.) There is, therefore, a need to increase the client base
through acquisitions and business development. This will ensure enhanced shareholder value into the future.
AfroCentric has a high fixed cost component, including IT systems and health risk management specialists. We aim
to enhance value through improving efficiency and maximising capacity.
Key performance indicators
− Cash-generating capabilities (cash flow)
− Dividend yield
− Return on equity (“RoE”)
− Return on capital employed (“RoCE”)
− Return on assets (“RoA”)
Action plan and targets
− Monitor non-performing contracts
− Grow client base and new schemes to
administer
− Capital management and capital
procurement
Action plan and targets
− Expand our supplier base to ensure
best attainable prices
− Lowering healthcare cost delivery
through technology and process
improvements