The Board is pleased to present comments on AfroCentric’s (“ACT”) summary interim results for the six months ended 31 December 2017. The period under review has been characterised by the consolidation and rationalization of several processes within Group enterprises, all having contributed positively to the Group’s growing operations and earnings. In addition, the Group continued to invest in system development and increased IT capacity, early benefits already having arisen through further client consolidation in this period, such consolidation and improved income, expected to continue to impact the full year results, including results for financial year 2019 and beyond.

Apart from ACT’s principal subsidiary Medscheme providing healthcare administration and managed care services to the membership of a growing number of prominent institutional clients, (having memberships in excess of 3.7 million lives), the Group’s further range of health related subsidiary enterprises has similarly continued to make good progress during the period, as will be evident in the financial results set out herein.


The summary consolidated financial statements are prepared in accordance with the requirements of the JSE Limited Listings Requirements for summary financial statements, and the requirements of the Companies Act applicable to summary financial statements.

The Listings Requirements require summary financial statements to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 Interim Financial Reporting. The accounting policies applied in the preparation of these summarized interim financial statements are in terms of International Financial Reporting Standards and are consistent with those accounting policies applied in the preparation of the previous consolidated annual financial statements.


AfroCentric is a JSE listed investment holding company which operates in and provides specialised services to the public and private healthcare sectors. AfroCentric continues to maintain its deliberate objective of being the leading exemplar of transformation and empowerment in the South African healthcare sector.

AfroCentric’s operating enterprises also provide a range of complementary services, which include, inter alia, information technology (“IT”) solutions; fraud detection, transactional switching; specialised disease management; pharmaceutical wholesaling and courier distribution services.


AfroCentric proudly advise that during the period under review:

  • AfroCentric Health (Pty) Ltd, a core operating subsidiary within the Group, achieved a level 2 B-BBEE status for the sixth consecutive year.
  • Medscheme Holdings (Pty) Ltd was awarded the “Service Excellence – Health Administrator Award”, at the 2017 BHF Titanium Awards ceremony.
  • AfroCentric was awarded the “Diversity in the Workplace Award” at the 15th Annual National Business Awards ceremony.


Profit before tax increased by 13.10% for the period under review amounting to R248.6 million (2016: R219.8 million). Profit after tax (PAT) increased by 15.67%, a satisfying and positive result delivered through great effort and efficient management control. Earnings per share (EPS) increased in this period by 18.60% and headline earnings per share (HEPS), increased by 19.00%, substantially through consistent growth in almost all divisions and sound cost management.


AfroCentric has for some time been focused on opportunities which will serve to create a platform, designed to establish a value chain of healthcare services, to optimize the purchasing power of every healthcare Rand through models of integration, mergers, partnerships and economic incentives devised to improve the effectiveness of patient care and viable treatment outcomes, within the broader healthcare delivery system. Several such proposals are already in place, several are in the pipeline and discussions on these initiatives are in progress, both for the public and private healthcare sectors.

During the period under review and prior to publishing these results, the following projects are in progress or have been concluded:

  • Assisted and facilitated the successful consolidation of approximately 5 600 Community Medical Scheme members (COMMED) into Bonitas Medical Scheme.
  • Secured the Hosmed Administration contract for Medscheme of approximately 24 000 members, a contract for providing Administration services for a significant number of members of the South African Local Government Association (SALGA).
  • Acquired 100% of the shares in Wellness Odyssey, a wellness company providing wellness days, health awareness and clinical guidance to medical schemes, including the broader corporate market, this effective from 1 July 2017.
  • Acquired 80% of the shares in Scriptpharm Risk Management, a business which manages chronic script claims, this effective from 1 August 2017.
  • Acquisition of 51% of the shares in Essential Group, which provides healthcare insurance, effective 1 March 2018.

The government has progressed towards the next phase in the implementation of the NHI. We welcome and support the proposed introduction of an NHI fund during 2017/2018. The Group is well positioned to support the NHI project through delivery of universal quality and affordable healthcare to a broader market.

AfroCentric’s Insurance Fraud Manager (“IFM”) provides comprehensive analytics which enable client schemes to identify and assess fraud and abuse related to medical claims. It is common cause that fraud, both by members and practitioners have over the years, become a material source of concern for all Medical Schemes. The identification and recovery of fraudulent or improper claims has been a great developmental success within our client portfolio and fraudulent claims amounting to in excess of R300 million have been detected, with a large percentage having already been recouped or are in the process of recovery.

Pharmacy Direct, our distribution subsidiary of pharmaceuticals, continues to make impressive progress. Pharmacy Direct now procures, dispenses and distributes chronic medication to public and private sector patients in seven provinces of South Africa, presently dispensing and distributing in excess of 500 000 pharmaceutical scripts per month. Given the positive growth and the divisions expanding market, a new warehouse was acquired in December 2017 to accommodate this growth in business.

Having regard to confirmation during this reporting period, that the AfroCentric/Sanlam profit warranty was comfortably fulfilled, the Board is pleased to report that both Sanlam and AfroCentric management are diligently working towards the finalisation of a range of healthcare products and lifestyle solutions to be jointly introduced into the market, this initiative, substantially being the very purpose of Sanlam’s interest in AfroCentric in the first place. The roll out is expected to occur towards year end and we are confident that this associate relationship could well evolve into a meaningful source of income and profit.


AfroCentric has once again delivered a solid operating result, particularly during an interim period laced with challenging politics and economic uncertainty. It was a period characterised by a lack of economic growth and declining consumer disposable incomes. Notwithstanding the above, the benefits of the Group’s maintained programme of expansion, including the general and sustained quality of earnings from within the underlying businesses, all contributed to the more than satisfactory financial outcome of the Group during this period under review.

The Group’s financial position remains sound, cash generation is strong and it retains adequate headroom to accommodate expansion opportunities. At corporate and operational level, management is assessing and implementing plans for real growth and pursuing selective local and international opportunities to complement the existing product and service offering.


There were no changes to the Board during the period under review.


The Board has pleasure in announcing that an interim dividend of 16 cents per ordinary share (gross) has been declared for the six months ended 31 December 2017. Dividends are subject to Dividends Withholding Tax. The payment date for the dividend is Monday, 14 May 2018. This interim dividend will constitute part of the Group’s annual dividend, to be considered in due course with the results for the year ending on 30 June 2018.

  • Dividends have been declared out of profits available for distribution.
  • Local Dividends Withholding Tax rate is 20%.
  • Gross dividend amount is 16 cents per ordinary share.
  • Net cash dividend amount is therefore 12.8 cents per ordinary share.
  • Company has 554 377 328 ordinary shares in issue as at the declaration date.
  • Company’s income tax reference number is 9600/148/71/3.
The salient dates relating to the dividend are as follows:
Last day to trade cum dividend Tuesday, 8 May 2018
Shares commence trading ex-dividend Wednesday, 9 May 2018
Dividend record date Friday, 11 May 2018
Dividend payment date Monday, 14 May 2018

Share certificates for ordinary shares may not be dematerialised or rematerialised between Wednesday, 9 May 2018 and Friday, 11 May 2018, both days inclusive.


The unaudited unreviewed interim results have been prepared under the supervision of Mr JW Boonzaaier CA(SA), in his capacity as the Group Chief Financial Officer. This announcement does not include the information required pursuant to paragraph 16A(j) of IAS 34. This is however available on our website (, or at our offices upon request.

On behalf of the Board

Dr ATM Mokgokong

Mr AV Van Buuren
Group Chief Executive Officer

19 March 2018