Brait’s NAV climbs 5% as Premier shines, Virgin Active faces challenges
Key topics:
NAV up 5% to R3.21 per share, driven by Premier’s performance.
Virgin Active: Revenue up, but churn and capex weigh on results.
Earnings drop: HEPS falls to 12 cents from 39 cents year on year.
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BizNews Reporter
Brait PLC has released its unaudited interim results for the six-month period ended September 30, 2025, highlighting an increase in Net Asset Value (NAV) per share alongside strong operational performance from its key underlying asset, Premier, while managing ongoing challenges within its other investments. The Group's overall strategy remains focused on unlocking value and optimising the asset base with the ultimate goal of returning capital to shareholders.
The Good: Value growth and portfolio strength
The primary positive indicator for Brait was the 5% increase in its NAV per share, rising to 321 cents, up from 306 cents reported at the end of the previous fiscal year (March 31, 2025).
The standout performer was Premier (37% of Brait’s total assets), a South African FMCG manufacturer. Premier continued its robust operational performance, achieving a 6.4% year-on-year (YoY) revenue increase (R10.3 billion) and a 13.6% YoY growth in EBITDA (R1.3 billion). This performance, driven primarily by the MillBake business, allowed Premier to de-gear significantly, achieving a net third-party debt leverage ratio of 0.7x (down from 1.0x in the prior period). The strong cash generation has provided the scope for a recently announced interim cash dividend and share repurchase program. Furthermore, Premier announced a transformational merger with RFG Holdings Limited, set to significantly diversify its product mix. The investment in Premier saw a significant increase in carrying value, rising to R6,350 million (up from R4,609 million reported in the prior comparable period).
Brait also took action to manage its liabilities, repurchasing £10 million of its Convertible Bonds during April 2025 at a discount to their par value, leaving £133.6 million outstanding. At the reporting date, Brait maintained available liquidity, including cash balances and facilities, amounting to R0.7 billion.
The Bad: Earnings decline and operational hurdles
Despite the rising NAV, Brait’s overall profitability metrics showed strain during the period. Earnings and headline earnings per share dropped significantly to 12 cents, down from 39 cents in the comparable period ended September 30, 2024. Furthermore, the total investment valuation gain recognised decreased to R700 million, compared to R898 million in the prior comparable period.
Virgin Active (59% of total assets) showed a mixed performance, reflecting the complexity of its operational turnaround. While the company achieved strong revenue growth across all territories—including the UK (12%), South Africa (15%), Italy (7%), and APAC (13%)—and saw its LTM EBITDA grow by 45% to £112 million, it faced key challenges. Churn remains elevated in Southern Africa due to affordability issues and club closures for refurbishment. Similarly, Italy experienced higher churn due to yield increases impacting price-sensitive regions, and the UK saw elevated short-term churn following a proactive strategy to roll clients onto 12-month contracts. The ongoing refurbishment programme also required a significant increase in capital expenditure, rising from £58 million in 2024 to £96 million in 2025.
New Look (3% of total assets) continues to contend with a tough operating environment in UK fashion retail. The retailer reported revenue for the first six months was down 2% on the prior year. Although restructuring efforts led to a 34% increase in EBITDA (to £21 million) due to cost management and digital transformation, the operating environment remains challenging. Consequently, the carrying value for the investment in New Look decreased slightly to R474 million (from R485 million at FY25).
In summary, Brait's core investment, Premier, provides a strong tailwind, boosting the crucial NAV metric, but the operational complexity and capital requirements of Virgin Active, alongside the tough retail environment for New Look, weigh on Brait's immediate earnings performance. Brait's total contingent liabilities and commitments stood at R4,151 million as of the reporting date.