TRUSTCO deviated from its policy not to respond to media critics, irresponsible, ill-informed and malicious reports, but recent statements demand a response.
Trustco also expects that the harmful and malicious statements by certain financial commentators and media practitioners regarding note 4 of the Provisional Reviewed Condensed Consolidated Financial Statements dated 31 March 2019, as published on SENS on 13 June 2019m should be corrected without delay.
“It t is with concern that the Company takes note of the ill-informed opinions of some commentators who have irresponsibly labelled the reclassification, as referred to above, as unethical or insinuated similar practices to recent corporate failures in South Africa. It has been the policy of the Company not to respond to media critics but the malicious nature of certain of these recent publications demand a response.
Trustco advises its shareholders (“Shareholders”) of the following regarding the matter:
• This reclassification was treated as required by IFRS. The nature and complexity of this matter demanded a robust and responsible approach to all of its aspects with extensive involvement of internal and external professionals. These included chartered accountants, independent certified property valuators, JSE-accredited IFRS advisors, external auditors as well as the board of directors. Agreement was not only on the technical matters, but also on the strategic rationale for the change which is a pre-requisite for a reclassification like this.
• The group’s property assets are carried at their fair market value as determined by an independent valuer. Any suggestion that our portfolio is overvalued is false.
• These properties comprise of more than 2,300 hectares of the highest quality sellable land available in Namibia, with a fair market value of more than NAD 2.3 billion. It is estimated that these properties will generate cash flows in excess of NAD 40 billion in future (refer to
the Company’s Integrated Annual Reports of 2017 (page 47) and 2018 (page 63)). The property business model creates value through the acquisition of virgin un-serviced land and then unlocks its true value through development into a product which meets the diverse needs of Namibians.
• Any comparison between Trustco and any other corporate failure associated with fraud, reveals a complete disregard of the facts.
Anything published to the contrary of these facts is published to cause harm to the Company and its Shareholders and responsible commentators should rectify their misleading statements without delay.