Efficient Group Limited. JSE: EFG

Background of Efficient
Efficient Group incorporates an array of businesses operating in the financial services sector, providing products and services related to financial planning, asset management, asset administration and asset consulting to a diverse client base in South Africa and neighbouring countries.
The group was established as an asset management company in 1999 and Efficient shares were listed on the Johannesburg Stock Exchange (JSE) in 2009. Subsidiaries today include Efficient Wealth, Efficient Advise, Efficient Select, Boutique Collective Investments, Boutique Investment Partners and Naviga Solutions.
The Financial Services cluster delivers comprehensive financial planning solutions, while distributing associated proprietary and external financial products for sale through a national network of financial advisors. The Services and Solutions unit is focused on model portfolio and multi-managed funds solutions tailor made for the needs of financial planners, institutional clients and individuals. Meanwhile, the Investments cluster carries out collective investment scheme administration, fund and private client wealth management and investment consultation.
The group has a JSE market cap of R550 million.
Efficient Shares Growth Driver
The Efficient Group was restructured into its current three-unit model in 2015, in order to establish a more market-focused structure as opposed to a single-brand, product-focused structure. This was in line with international trends of internal entrepreneurship, aiming to empower business units to function independently and be more responsive to market needs. The focus is to buy entrepreneurial, like-minded entities to expand the group’s value chain.
Efficient’s latest financial data, covering the six months ending February 2016, reflect satisfying performance, with revenue growth of 24% and headline earnings per share increasing by 51%, with corresponding improvements in dividends and Efficient share price.
Growth was largely attributed to the successful integration of businesses that the company managed to buy in the previous two years, and an increase in assets under management. This was despite a difficult economic environment which impacted many financial services companies.
A 41% growth in revenue for the Financial Services division was as a result of expansion of the distribution network. Profitability improved from break-even levels to R4 million, and is forecast to continue improving as a result of the economies of
scale. Services and Solutions recorded a lower operating profit of R7 million, due to decrease in assets under management through portfolio restructuring. Investments boasted profits of R16 million, compared to R4 million the previous year. Most of the growth was achieved in the high-volume, low-margin asset administration business.
Efficient Investor Tip
The live online stocks chart shows that Efficient share price has gone in an opposite direction to the many companies suffering from the effects of the economic downturn. Efficient share price remained level throughout 2015 and has recorded sharp upward growth in 2016.
The Efficient Group’s strong management skills, progressive business model and successful acquisitions have boosted the growth of this mid-cap company. As financial conditions continue improve, shareholders can expect upside growth of Efficient share price. Efficient shares are widely regarded as a savvy buy.
Efficient Major Shareholders
Private Equity Partners, RW Trust, Sasfin Financial Services, Thebe Investment Corporation, Heiko Weidhase and Dawid Daniel Roodt.
Sector
Financials
Industry
Asset Management
Sub industry
Investment Management
How to buy Efficient Group Shares
Efficient : How to buy Efficient Group Shares Online
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