Regional exchange BVMAC sees turnaround after years of losses
TLDR
- BVMAC achieves first profitable result of 8.588 million FCFA since 2019 merger, marking significant turnaround.
- Company's challenges of high debt and declining equity addressed with new financial measures in 2023.
- Pending approval at general meeting on May 16, including capital increase and discussions for a loan with FODEC for further financial strengthening.
The Central African Securities Exchange (BVMAC) has announced a net profit of 8.588 million FCFA ($14,178) for the fiscal year 2023, marking its first profitable result since the merger of the two CEMAC stock exchanges in 2019.
This achievement is significant given the company's previous challenges, including high debt, declining equity, and subdued stock market activity leading to consecutive losses in preceding years. The exact reasons behind this turnaround have not been disclosed, pending approval of financial statements at the general meeting scheduled for May 16.
However, in 2023, BVMAC initiated measures to strengthen its financial position, including a capital increase of 2.030 billion FCFA by incorporating receivables from the defunct Douala Stock Exchange. Additionally, discussions with FODEC for a 1 billion FCFA loan aimed at bolstering its funds were underway.
Key Takeaways
BVMAC, one of Africa's two regional exchanges spanning the six Central African francophone countries, operates similarly to BRVM, utilizing the CFA currency and boasting a tech-driven headquarters in Douala. The institution's total balance sheet slightly increased in 2023 to 6.362 billion FCFA from 6.121 billion FCFA the previous year, signaling a resurgence in activity post-liability clearance. As reported by Sika Finance, BVMAC's management plans to present a revised draft of its general regulations for shareholder approval. These revisions are expected to introduce new reforms, such as share value splitting and enabling direct market engagement for small investors through mobile money platforms. These initiatives aim to enhance market accessibility and facilitate broader participation, aligning with the exchange's commitment to fostering a robust and inclusive investment environment.
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