Annual Report and Audited Financial Statements

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Annual Report and Audited Financial Statements 2015 ANNUAL REPORT and Audited Financial Statements TRADING AUTOMATION Real time execution of clients’ orders CRESTED CAPITAL ANNUAL REPORT 2015 1 2 CRESTED CAPITAL ANNUAL REPORT 2015 TABLE OF CONTENTS 4. CORPORATE INFORMATION 26. SUSTAINABILITY REPORT 5. WHO WE ARE 28. CORPORATE SOCIAL RESPONSIBILITY REPORT 6. COMPANY VALUES 29. CORPOraTE GOVERNANCE 7. CHAIRMAN’S STATEMENT 31. CRESTED CAPITAL ACTIVITIES IN PICTURES 9. BOARD OF DIRECTORS 34. REMUNEraTION REPORT 12. CHIEF EXECUTIVE OFFICER’S STATEMENT 35. DIRECTORS REPORT AND FINANCIAL STATEMENTS 13. MANAGEMENT TEAM 36. STATEMENT OF DIRECTOR’S RESPONSIBILITIES 16. CRESTED CAPITAL STAFF 37. INDEPENDENT AUDITORS’ REPORT 18. OUR PRODUCTS AND SERVICES 38. STATEMENT OF COMPREHENSIVE INCOME 19. 2015 SUMMARY 39. STATEMENT OF FINANCIAL POSITION 20. FINANCIAL AND OPEraTIONAL TRENDS 40. STATEMENT OF CHANGES IN EQUITY 22. BUSINESS REVIEW 41. STATEMENT OF CASH FLOWS 24. RISK ASSESSMENT REVIEW 42. NOTES TO THE FINANCIAL STATEMENTS CRESTED CAPITAL ANNUAL REPORT 2015 3 CORPORATE INFORMATION First Floor, Impala House, Plot 13/15 Kimathi Avenue P. O. Box 31736, Kampala, Uganda. Tel: +256 312 230 900 / +256 758 230 900 [email protected] | www.crestedcapital.com COMPANY SECRETARY AUDITORS Mr. Richard Adubango Plot 13/15 Kimathi Avenue P O Box 31338, Kampala KPMG Uganda REGISTERED OFFICE Certified Public Accountants (Uganda) First Floor, Impala House 3rd Floor, Rwenzori Courts Building Plot 13/15 Kimathi Avenue P O Box 3509, Kampala P O Box 31736, Kampala BANKERS Members of Uganda Securities Exchange DFCU Bank Limited UAP Nakawa Business Park Impala House P. O. Box 23552, Kampala P.O. Box 70, Kampala Stanbic Bank Uganda Limited Licensed by Capital Markets Authority Crested Towers 8th Floor, Jubilee Insurance Centre P.O. Box 7131, Kampala P. O. Box, 24565, Kampala 4 CRESTED CAPITAL ANNUAL REPORT 2015 WHO WE ARE History Crested Capital (a trade name of Crested Stocks and Securities Ltd.) are licensed investment advisors and broker dealers by the Capital Markets Authority of Uganda (CMA) and Members of the Uganda Securities Exchange (USE). The company was founded in 2004 and first licensed by the CMA in 2005 and admitted as Members to the USE in 2008. As the leading independent broker dealer in Uganda Crested Capital brings unique energy, focus, and commitment to developing the country’s capital markets. How to Build the Capital Markets It takes an enabling regulatory environment It takes It takes the shouting voice of reason It takes a bit of selflessness and Most of a bit of selfishness, all, it takes but not too much It takes individuals, commitment of either not institutions CRESTED CAPITAL ANNUAL REPORT 2015 5 COMPANY VALUES 1 INNOVation We offer innovative investment strategies and products to help you grow your capital SHARING SUCCESS 2 We will always be fair, share in our company’s success, and acknowledge effort accordingly EAST AFRICA We plan and act for the future. Crested Capital will grow as Uganda and the CUSTOMER CARE region grows 3 We care about you. Offering outstanding customer care is not just a statement for Crested Capital, it’s our mission 4 6 CRESTED CAPITAL ANNUAL REPORT 2015 CHAIRMAN’S STATEMENT Crested Capital continued the same path by re-aligning other operational areas to ensure that our clients are served even better in the year 2015. In my capacity as Ag chairman Board of directors of Crested Capital, I would like to pay special tribute to Mr. Habib Kagimu who diligently served our board during all the years of turbulence before we could make any profit as a company until the year of 2014 where he guided us into profitability for the first time in history. Within the first 21 days of this year, Crested embarked on a strategic retreat away from Kampala to plan and strategize on how to become and maintain our leadership position of the largest broker/dealer in our market, a plan that I am sure was well drawn and executed during the period ending December 2015 because a lot that was planned to do was achieved as will be highlighted in the CEO’s statement. Particular attention was put on how to maintain our profitability level achieved in the previous year 2014 as well as particular growth areas to better serve our clients. I am glad to report that as the year 2015 ended, Crested Capital was able to provide more comfort to our clients as they choose their investment Dear Stakeholders, strategies as well as convenient after sales services for exiting ones. 2015 was an exciting year for Crested Capital. Right from the highly studied re-branding phase which created Interesting for me during the year was the challenge of working Crested Capital, we went straight into the New Year with with a board consisting of a wide range of resources in business zeal to make further footsteps in the capital markets of development and professionalism within Uganda and the entire Uganda. We began with key management changes that East African region. I would like to commend the management created the Treasury and Equity financing departments team and the entire staff for their focus and dedicated execution that added significantly to our existing services. that enabled them sustain the growth momentum which was achieved in the year 2014. All this seemingly normal, I would like to commend the stewardship of our CEO Mr. Robert Baldwin and his Performance in 2015 management team that envisaged this as a very possible Our position on entry into 2015: Our business environment avenue to add to our productiveness. during 2015 was a twofold affair. The overall market performance at the beginning of the year was on a flat and seemingly down word trajectory while Crested Capital was doing the opposite of that showing a steady growth trend. Most of Crested Capital’s revenue being recorded within the first five CRESTED CAPITAL ANNUAL REPORT 2015 7 months of the year. Focus on the new business lines, a stronger I believe Crested will continue to grow strongly and innovate in risk management environment and our cost management order to continue supporting our clients and customers, despite agenda made Crested Capital a stronger company in 2015. all factors that affect growing businesses. We are very ready to tackle the New Year 2016 with more determination to achieve. Financial Performance; Much of this will be given in the CEO’s We have identified and assembled a strong team for Crested report but a little highlight on this shows that, Bottom line Capital to drive future growth. We will continue to use our Crested capital made a small loss compared to the previous year regional presence to produce better value to all our stakeholders. 2014. of 13,590,798 Uganda shillings compared to a profit of 357,281,159. I am glad to report that this loss was not as a result Appreciation of nonperformance but as a result of increased expenditure on I would like to salute Crested Capital’s management and staff, staff development and growth. customers, shareholders and partners, for their full support and dedication to the company, and for their confidence in the Board The Board of Directors therefore will not recommend any and Management during the year 2015. dividend for the year 2015. I also wish to thank our regulators the Capital markets Authority Factors that impacted our business in 2015. and Uganda securities Exchange for their enabling environment Trade Automation: The Uganda Securities Exchange moved from that has allowed us to continue with our growth. the semi manual trading platform to a fully automated trading platform. I am happy to report that our traders no longer go to the As the board of directors, we pledge to continue supporting and trading floor but are allowed access to the trading platform via providing proper guidance in order to deliver value to both the the on line system purchases by the Uganda Securities Exchange. company and the industry. We are very happy about the development. Its operation so far can be said to be technical but very swift and good. Crested Capital joined the elite group of international traders by purchasing a Bloomberg screen, order taking and execution Sam Muhanguzi improved tremendously by this screen. Ag. Chairman Regulatory environment: Our regulators changed from onsite inspections to a self-assessment and report of risks. This gave us a lot of responsibility and confidence in our market. And significantly allowed a lot of time to concentrate on the business as well as staying within compliance parameters. 8 CRESTED CAPITAL ANNUAL REPORT 2015 BOARD OF DIRECTORS SAMUEL MUHANGUZI - Ag CHAIRMAN Samuel is a management and technology systems consultant. His current fields of engagement include strategy consulting, investment and social development advisory work in Africa. He began his career in 1984 as a junior officer in the Ugandan army, later joined UNICEF and transited to various positions in the World Bank, para-state agencies for roads, IT and special projects. Samuel has been a pioneer in most organizations – being the first head of IT at UNICEF, Kampala, Manager for MIS at National Roads Authority (UNRA), head of IT Portfolio Management at the National Information Technology Authority (NITA), founder of Crested Capital Ltd, Planet Systems and the first citizen interaction center under the President’s office. He has led consultancies in NGOs in Uganda, Kenya and South Africa focusing on organizational development, corporate systems planning, design and implementation, project organization, community development. Samuel is a strong advocate for SME and government involvement in entrepreneurship programmes. Samuel holds a Master of Science in Information Technology (M Sc) from University of Maryland (USA), a Masters of Business Administration and Management (MBA) from University of Hartford, Paris, France.
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