1. ANNUAL REPORT 2011
12 October 2011
Morgan Pillay

2. CONTENT The mandate The year in perspective
Development performance 2010/11
Financial performance 2010/11
Breakdown of reasons for poor performance
Key strategic issues
Conclusion

3. THE MANDATE
NURCHA ensures the availability of bridging finance to small, medium and established contractors building low and moderate income housing and related community facilities and infrastructure

4. THE YEAR IN PERSPECTIVE
Poor economic trading conditions
Business growth and performance negative
Contracts signed reduced by 44%
Houses built decreased by 33%
Value of loans decreased by 51% (Value of Projects reduced)
Infrastructure projects completed decreased by 31%
Provisions for project losses increased from R51 to R104m
Mobilized private sector funding R75m
High cost of financing
Persistent non-payment from government departments
Restricted lending (Infrastructure and Subsidy Programme)

5. THE YEAR IN PERSPECTIVE (cont)
Government recapitalization of R300m approved (First tranche of R100m received 2011)
Geographical footprint and coverage consolidated
Alignment with intermediaries weakened
Loss of Sebra

6. DEVELOPMENT PERFORMANCE
2010/11

7. HOUSES IN APPROVED LOANS AND COMPLETED HOUSES
12750
8254

8. LOAN AND PROJECT VALUES (R MILLIONS)
1019.2
267.9

9. COMPLETED HOUSES/SITES

10. NUMBER OF HOUSES/SITES IN APPROVED LOANS

11. NUMBER OF PROJECT LOANS APPROVED BY PROVINCES

12. VALUE OF LOANS FINANCED
(R MILLIONS)

13. VALUE OF PROJECTS FINANCED
(R MILLIONS)

14. ANNUAL EMPOWERMENT STATUS
April 2009-March 2010
April 2010-March 2011
Value of loans (Actual)
Number of contractors 98 59
Number of 1st time applicants 70 39
Black owned
80.5%
268,655,382.11 86
184,985,080.30
Non BEE
19.5%
286,158,888.34 14
82,928,501.00
TOTAL
100%
554,814,270.45
267,913,581.30
Male owned
78.3%
484,791,495.84
220,172,344.30
Female owned
21.7%
70,022,774.61 30
47,741,237.00
Emerging
73%
231,476,772.11 87
167,888,253.30
Established
27%
323,337,498.34 13
100,025,328.00

15. FINANCIAL PERFORMANCE
2010/11

16. KEY STATISTICAL INFORMATION YEAR ENDED 31 MARCH 2011
KEY STATISTICAL INFORMATION YEAR ENDED 31 MARCH 2011
2010
2011
% INCREASE/
(DECREASE)
R’000
Income from operations
43,012
35,167
-18.23
Administration expenses
40,058
41,316
3.14
(Deficit)/surplus for the year
-18,826
(66,398)
252.71
Loans for construction projects
403,527
375,933
-6.84
Provision for losses
51,384
104,204
102.79
Bank loans to finance projects
152,406
91,083
-40.24

17. BREAKDOWN OF REASONS FOR POOR PERFORMANCE
BREAKDOWN OF REASONS FOR POOR PERFORMANCE
Volume of new public sector tenders low
Late payments by employers especially government departments
Final accounts and retention money to settle the debt – disputed by employers
Budgetary constraints by employer departments
Poor project costing and inability to manage contractor

18. BREAKDOWN OF REASONS FOR POOR PERFORMANCE (cont)
BREAKDOWN OF REASONS FOR POOR PERFORMANCE (cont)
Perceived risk - Commercial banks not willing to grant loans to end users
Lack of loan facilities at concessionary rates
No prospect of grants and or donor funding

19. KEY STRATEGIC ISSUES 19191919 Alignment to Outcome 8
Affordable Housing in GAP market
Fee Income opportunities
Free State Province
KZN – Account Administrator
New Contractor Finance and Development Programme
Renewed payment and contracting arrangements with government departments to spearhead business growth

20. VALUE OF PROJECTS SUPPORTED SINCE INCEPTION
CONCLUSION
R 14 BILLION
VALUE OF PROJECTS SUPPORTED SINCE INCEPTION
NURCHA
“GOING
BEYOND
FINANCE”