Africa Finance Corporation tops US$10 billion target one year early
Africa Finance Corporation (AFC), Africa’s leading infrastructure solutions provider, has recorded an outstanding performance in its latest financial year, with total assets growing 23% to US$10.5 billion and the Corporation realizing its five-year growth target a year early.
Against a challenging global economic and geopolitical backdrop in FY2022, AFC increased profit by 36% to US$285.9 million, boosted operating income by 54% to US$400.4 million, and improved the liquidity coverage ratio to 202%.
AFC President & CEO, Samaila Zubairu, said: ”To scale up our development impact across Africa, in 2018 we set out to more than double the Corporation’s total assets from US$4.5 billion to US$10 billion, improve our return on equity from 7% to over 12%, and broaden our investment footprint on the continent in terms of geography and sector concentration, all within a five-year period. I am pleased to report that we have met and, in some cases, exceeded our targets on all of these pillars, well ahead of our end-2023 target for achieving the strategy’s objectives.”
AFC’s pan-African reach expanded through investments in 36 countries, and accession to the Corporation by seven additional member states—Angola, Botswana, Cameroon, Somalia, South Sudan, Tunisia, and Ethiopia—taking the total number of member states to 40, three-quarters of the continent. Four new sovereign shareholders, Egypt, Mauritius, Cote D’Ivoire and DRC, helped increase total equity by 21%, to US$2.67 billion from a total of 37 equity investors.
AFC’s consistently strong performance has been achieved by investing in projects that blend meaningful development impact with high risk-adjusted returns, leveraging the Corporation’s talent and execution culture to achieve its mandate of building the infrastructure required to foster industrialization in Africa.
Notable project investments in 2022 include AFC’s joint acquisition of Lekela Power, Africa’s largest renewables-focused independent power producer; co-development of the Nyanza Light Metals titanium dioxide plant in South Africa; scaling up the number of countries in ARISE IIP from three countries to several African countries; and participation in a EUR650 million financing for Société Africaine de Raffinage, the national refinery of Senegal.
In response to global supply chain vulnerability and other economic challenges created by the COVID-19 pandemic and Russia-Ukraine conflict, AFC launched a US$2 billion facility to support economic recovery and resilience in Africa, helping to drive a new phase of growth that is focused on maximizing resource value capture and domestic job creation.
Other financial highlights include:
- Return on average equity at 12.1% (2021: 9.7%)
- Net interest income up 49% to US$327.9 million (2021: US$220.7 million)
- Total comprehensive income up 52% to US$285.3 million (2021: US$188.2 million)
- Capital adequacy ratio at 34.3% (2021: 33.2%)
- Cost-to-income ratio at 22.7% (2021: 22.9%)
- Earnings per share up 35% to US$0.2437 (2021: US$0.1809)
AFC remains committed to accelerating structural transformation, value-addition and industrialization to transform lives and usher in Africa’s era of prosperity. This is in conjunction with AFC’s stated policy of developing and de-risking critical infrastructure projects that support value addition of primary products at source and the development of viable economic zones to boost local capacity and job creation.
“AFC is well positioned to continue playing a key role in delivering on our African-wide development mandate and helping to close the continent’s infrastructure gap,” said Zubairu. “We are entering this year with a focus on strengthening and building collaborative partnerships that deliver measurable developmental impact, anchored in our belief that Africa holds the solutions to the world’s greatest challenges.”