Joburg talks to investors

Presentations are being given in Cape Town and Johannesburg to the investment community on the City’s audited financial statements, business plans and strategy for the future.

TOP Joburg officials are in Cape Town as part of a two-legged road show to present the City’s audited financial statements to investors.

MMC for finance Geoffrey Makhubo (Photo: Enoch Lehung, City of Johannesburg)MMC for finance Geoffrey Makhubo (Photo: Enoch Lehung, City of Johannesburg)The delegation left today for the Mother City and comprises the portfolio head of finance, Geoffrey Makhubo; the City manager, Trevor Fowler; and the head of investor relations, Floyd Sibandze.

Each year, the City undertakes an official communication and engagement session with its investor community to present its audited financial statements, business plans and strategy for the future. “We are obliged to report back on our financial performance and strategy to the bondholders, who are mostly asset management organisations,” explains Makhubo.

Portfolio managers, relationship executives, and credit and market analysts for, among others, Investec, Old Mutual, Allan Gray, Moody’s Investor Services, First Rand Group, National Treasury, Standard and Absa banks and the Johannesburg Stock Exchange make up the audience.

“On 13 September, we will be at the Westin Grand Hotel in Cape Town and [will] return to Joburg the next day to do a presentation at the Hilton Hotel,” says Makhubo.

Both sessions start at 8.30am and end at 11am. Although the City received a qualified audit report for the 2010/11 financial year, it has since received favourable credit ratings. It has also issued seven bonds since 2004.

Municipal bonds are debt obligations issued by government entities to members of the public to generate income to meet capital expenditure requirements. The issuer of the bond guarantees to pay interest at set periods and to repay the debt on a specified date. The interest paid on the bond is tax deductible and issuing these bonds is standard practice for cities.

The Domestic Medium Term Note programme allowed the City to issue up to R6-billion in municipal bonds up until 2010 without having to provide additional documentation ahead of each new issue. All the bonds are listed on the Bond Exchange of South Africa.

Fowler, during these sessions, will also outline Joburg’s Growth and Development Strategy 2040 vision, on which it is engaging citizens to ensure that it can meet the future demands of an ever-changing city.