PME African waiting on good news

15th Jun 2011 13:12

PME African Infrastructure Opportunities, an AIM listed investment company focused on sub-Saharan Africa, saw its net asset value (NAV) fall 10.1% in the year ending 31st December 2010.Its preliminary results also reveal it is paying a dividend of 14 cents per ordinary share, thought to be financed from un-invested cash.PME broadly has two main holdings. It owns 12 locomotives in South Africa from which it attempts to derive a leasing income. It has also invested in telecommunications in Tanzania and Uganda. The idea has been to extract steady revenues from the locomotive business while waiting for the telecoms investments to yield bumper returns on the back of technological advantages, particularly in mobile data.As PME makes clear, the locomotive sector has struggled in difficult market conditions while the telecoms investments are at a critical stage during which their full potential (or lack thereof) will become apparent. In his statement, the chairman of PME, David von Simon, describes the company's investments in Tanzania and Uganda as at an "inflection point".Nevertheless the results statement also admits that "PME remains in consolidation mode and no new investments are being considered at this stage."BS