The corporation remains optimistic despite past financial challenges, as revamped businesses within its portfolio have begun making positive contributions to revenue through increased sales activity.
According to BDC Head of Corporate Affairs, Boitshwarelo Lebang-Kgetse, recent financial results for the half-year to December 2024, were impacted by one-off items, including losses in the insurance sector as well as initial marketing costs for new and restructured companies, and setbacks from associate entities.
However, she emphasised that ongoing initiatives are expected to improve financial performance, with heightened sales activity already evident amongst key investments.
"Our performance is expected to improve on the award of new contracts. “At the moment, BDC is looking forward to executing an additional contract from a major vehicle manufacturer, which is expected to realise sales in 2027. “Between now and then, we will be undertaking various activities to prepare to service the contract," she stated.
Over the past five years, BDC has made several strategic investments both locally and offshore, aligned with its mandate and commercial objectives. These sectors include manufacturing, health care, financial services, hospitality, agri-business, retail and real estate. The investments were selected to stimulate economic diversification, job creation, industrial development and value chain developments.
Furthermore, the corporation was mandated to administer P300 million under the Industry Support Fund (ISF) to large-scale businesses. BDC disbursed P172 million to businesses operating in the manufacturing, health, services, real estate, hospitality and retail sectors. In total, BDC has invested P1.40 billion into these new businesses being both equity and debt instruments as well as infrastructure financing.
Additionally, six new deals totalling P679 million have been approved and are awaiting disbursement. The corporation has made additional investments into existing portfolio companies amounting to P396.2 million with the companies currently sustaining 627 jobs.
BDC’s investment pipeline remains diverse, encompassing projects in manufacturing, agro-processing, healthcare, and green energy. The corporation secured a climate-related funding facility of €50 million (P736 million) in 2023, with plans to direct these resources towards projects advancing climate adaptation and mitigation, particularly in green energy. These ventures align with BDC’s overarching mandate to drive economic diversification in Botswana.
In addition to its investment strategy, the property sector continues to perform strongly, further reinforcing BDC’s financial outlook. A key associate company has also undertaken the disposal of underperforming subsidiaries, a move anticipated to boost overall profitability and enhance income streams.
BDC, which maintains investments in over 30 companies across various industries, operates through 14 subsidiary companies and six associate companies.
Lebang-Kgetse said the corporation’s profitability for the remainder of the year will be primarily driven by dividend inflows from its subsidiaries and associates, as well as disciplined cost management across the group. Additionally, she said the conclusion of disbursements into a pipeline of new strategic projects is expected to positively impact interest income in the final quarter.
As part of its strategic expansion, the corporation has also launched an asset management company as a wholly owned subsidiary. Once licensed, this entity will play a pivotal role in diversifying BDC’s funding sources and expanding its capital base. By targeting both local and international pension funds, the subsidiary will strengthen financial structuring opportunities, leveraging fund management frameworks regulated by the Non-Bank Financial Institutions Regulatory Authority.
