Inqo Investments Ltd - Annual Financial Report

Inqo Investments Limited

Press release at 30 July 2025

Audited Group Results for the year ended 28 February 2025

CHAIRMAN AND CHIEF EXECUTIVE'S STATEMENT

Inqo Investments Limited ("Inqo" or "the Group") is a South African based social impact company that invests in businesses that tackle poverty and environmental challenges in Sub-Saharan Africa.

COMMENTARY

The Group remains in a strong financial position with total assets of R238 million including cash and cash equivalents of R48.8 million and minimal debt.

For the year end under review, the Group returned to profitability, marking a significant financial turnaround from the previous year reporting a profit of R20,235,550 (2024: Loss of R5,303,571).

In 2023, Inqo was awarded a US$4 million grant over three years to fund its Conservation and Rural Enterprise (CARE) project in Uganda. To date, Inqo has received US$3 million of this grant. During the current year, the Group formalised three CARE investments in Uganda, namely Flybox Budongo (BSF) Farm Limited, Pabidi Lodge Budongo Limited and Empower Clean Cooking Limited.  The grant income is recognised in the income statement as and when funds are spent on approved project activities. Until then, the funds received are recorded as a deferred liability. As a result, the grant has positively impacted profitability during the current period, with R19,771,009 (2024: R1,697,069) recognised in income. The remaining balance of the grant will continue to support Inqo's activities for approximately two more financial years. Shareholders should note, once fully utilised, this income stream will end and profitability is expected to normalise unless replaced by other sources of funding or new income from our CARE project in Uganda.

In April 2024, the company issued 1,854,646 new ordinary shares, raising gross capital of R 29,984,428. This includes the conversion of two credit loan notes of USD 1,000,000 and R 2,000,000 respectively into equity by the lenders exercising their conversion rights.

In December 2024, the company issued a dividend for the first time since incorporation of R0.07 per share amounting to R1,146,014.

FINANCIAL INFORMATION

The financial information set out in this announcement does not constitute statutory financial statements. This financial information has been extracted from Inqo's audited group financial statements for the year ended 28 February 2025.

FINANCIAL RESULTS

The audited financial results for the year ended 28 February 2025 are as follows:

The directors of Inqo reviewed the valuation placed on all income earning assets to ensure that they reflect their fair value. Following the reviews, the directors are of the view that Group assets as stated in the Statement of Financial Position are reflected at fair value. 

INVESTEE COMPANIES: FINANCIAL, ENVIRONMENTAL AND SOCIAL PERFORMANCE COMMENTARY

Beyond the specific changes outlined below, there have been no other material developments or significant events impacting the investee companies during the period.

Kuzuko Lodge (Pty) Limited (South Africa)

For the year ended 28 February 2025, Kuzuko Lodge generated a profit, marking a significant financial turnaround from the previous year. Kuzuko Lodge reported a profit of R2,702,737 in the current financial year, a substantial improvement from the R2,882,391 loss recorded in 2024. This was driven by a 40% increase in revenue and a continued year-on-year upward trend in occupancy rates. The success is primarily attributed to targeted marketing efforts and disciplined cost containment strategies.

CARE Investees

·   Flybox Budongo (BSF) Farm Limited (Uganda) forms part of the Uganda CARE project. lnqo has partnered with Mana Biosystems Limited (United Kingdom) (FlyBox UK) to implement the Black Soldier Fly project in Uganda. The purpose of insect farming is to upcycle organic waste into animal protein and compost. The business will initially sell larvae and eggs to farmers to grow to maturity by feeding on market and organic waste. These larvae can then be harvested for use as protein substitute in animal feed. At reporting date, Flybox UK had built the modular insect farms, however due to shipping and clearance delays, delivery only took place in July 2025. Trading is expected in the 2025/26 financial year.

·    Pabidi Lodge Budongo Limited (Uganda) forms part of the Uganda CARE project. Pabidi Lodge is currently under construction and a soft opening is expected in September/October 2025. The lodge will be the only luxury accommodation offering sustainable ecotourism to guests in the Budongo Forest. The lodge will be operated by our joint-venture partner, Great Lakes Safaris, one of the leading tour operators in Uganda. Great Lakes Safaris hold the sole conservancy in the Budongo Forest, an 825 sq km forest that is home to more than 600 chimpanzees. The site clearance and construction of the lodge commenced during the reporting period.

·   Empower Clean Cooking Limited (Uganda) forms part of the Uganda CARE project. Empower Clean Cooking Limited is a joint venture between Inqo and East African Power Limited. Empower Clean Cooking Limited will be managed and operated by East Africa Power, a highly experienced renewable energy developer and operator with hydro and solar plants in Rwanda, Uganda, DRC, Zambia, Zimbabwe and Kenya. The objective of the company is to safeguard the environment through providing clean cooking solutions to local environments. The joint venture will manufacture biomass pellets for cooking fuel as an alternative to wood and charcoal and to explore clean cooking solutions for the local community. The site clearance and preparation for the factory construction commenced during the reporting period.

SUMMARY OF SOCIAL & ENVIRONMENTAL METRICS SINCE PROJECT COMMENCEMENT

·      Kuzuko Lodge

o  35,617 acres (14,414 hectares) of former farmland restored and protected as a game reserve

o  70 km of game fencing erected, including internal fencing

o  50 FTE staff at Kuzuko in standard housing with flush toilets, power, water and solar panels

o  120 fixed term jobs

o  Conservation of 2 endangered species, 8 endangered species protected, 23 species introduced

o  32 cheetahs have been rewilded and/or translocated to other reserves through a conservation program aimed at restoring cheetah populations to their native habitats

·      South Lake Medical Centre

o  119,214 patient visits including 1,498 HIV patients receiving care and/or counselling, 65,164 through community outreach, 147 safe deliveries, 205 surgeries and 622 antenatal care

o  Expanded to 5 Health Posts (micro-clinics) for easier patient access  

·      Kentegra

o  Payments of over US$2.6M to approximately 20,000 out-growers/farmers

o  Digitised its Village Savings and Loans Associations program, which has seen significant savings and loans among farmers

·      Sanergy

o  1,000 FTE, 2,000 indirect jobs, 5,000 toilets serving 270,000 people daily in Nairobi, Kisumu and Eldoret

·      Spekboom Trading

o  5,185 hectares degraded land planted with 30 million spekboom; 350 fixed term jobs

·      CARE Projects

o  A baseline study was performed and the success of the projects will be measured against the outcomes of this study

STAFF

The directors would like to take this opportunity to thank all the operating staff in the Group for their contribution and commitment to the Group's objectives during this challenging time.

Dr K.S Tan                                                                                         R.H Steyn

Chairman                                                                                       Chief Financial Officer

Issued on: 29 July 2025

Enquiries:

Inqo Investments Limited

Robyn Steyn, Chief Financial Officer                                           finance@inqo.co.za

Bowsprit Partners Limited (Corporate Adviser)                  

John Treacy / Luis Brime                                                           +44 (0) 203 833 4430