Capricorn Group Posts 14.8% Profit Growth to N$1.99 billion; Expands Socio-Economic Impact- ISSUE # 79☕

Welcome to today’s edition of Revolox Media – bringing you the stories shaping Namibia’s economy and the global innovation landscape.

Capricorn Group has reported a 14.8% profit growth to N$1.99 billion, underscoring its expanding socio-economic impact across the country. In the energy sector, Eco Atlantic has secured key Namibian licence extensions while farming out its Sharon Block to Lamda Energy, strengthening collaboration in oil exploration.

On the global front, Chinese AI firm DeepSeek has unveiled its R1 model, offering ultra-low costs that could disrupt US industry standards and reset competition in artificial intelligence. Meanwhile, the UK and US have signed a historic £31 billion Tech Prosperity Deal, aiming to accelerate growth in AI, quantum, and frontier technologies.

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BUSINESS & ECONOMY

Capricorn Group Posts 14.8% Profit Growth to N$1.99 Billion; Expands Socio-Economic Impact

Capricorn Group Limited reported a robust financial year ending 30 June 2025, with key improvements across profitability, efficiency, and social value creation.

Key Financial Highlights:

• Profit after tax increased 14.8% to N$1.99 billion, up from N$1.74 billion in 2024.

• Return on equity improved to 18.2% from 17.9%.

• Net interest income before impairments rose 10.1% to N$3.4 billion, supported by a 3.7% loan book growth.

• Non-interest income rose 13.1%, driven by digital transaction fees and asset management growth.

• Operating expenses increased 10.8%, mainly due to variable banking costs, transaction volumes, employee, and technology expenses.

• Cost-to-income ratio improved to 49.5% from 50.0%, remaining well below the internal threshold of 52%.

• Asset quality stable with non-performing loans at 4.0%, and reduced impairment charges to N$315 million.

• Gross loans and advances grew 3.6% to N$52.5 billion.

• Strong liquidity with liquid assets at N$18.7 billion.

• Capital adequacy ratio of 18.1%, well above the regulatory minimum of 12.5%.

• Loan-to-funding ratio increased slightly to 88.8%, below the internal limit of 90%.

Socio-Economic Contributions:

• Created N$5.7 billion in value, up 11.7% year on year.

• Distributions included N$1.4 billion in employee remuneration and benefits.

• Paid N$1.1 billion to (mostly local) suppliers.

• Contributed N$1.4 billion in government taxes and royalties.

• Invested N$26.7 million in community projects per the Social Value Report.

Executive Insights:

Group CEO David Nuyoma credited these results to operational resilience across Namibia and Botswana businesses, including Bank Windhoek, Bank Gaborone, Capricorn Asset Management, Entrepo, Peo Finance, and associates like Paratus, Sanlam Allianz Namibia, and Santam Namibia.

"Our strength lies in our commitment to connecting positive change and improving lives through leadership in financial services," Nuyoma said. He emphasized promising growth pathways, especially in Namibia’s renewable energy sector, and Capricorn’s role in supporting sustainable economic development.

Dividend Declaration:

• Final ordinary dividend of 74 cents per share.

• Alongside a 61 cents interim dividend, cumulative ordinary dividend for the year totals 135 cents, a 20.5% increase.

• Special dividend of 36 cents per share announced, making total payout 171 cents.

• Dividend payout ratio increased to 44.5% from 33.4%.

• Total dividend distribution to shareholders scheduled for 24 October 2025.

The Bottom Line:

Capricorn Group’s strong financial performance, strategic operational management, and commitment to socio-economic value creation underscore its position as a leading financial services group in Namibia and Botswana. The group is well placed to capitalize on growth opportunities while maintaining robust profitability, liquidity, and asset quality across its diversified portfolio. This sustainable approach balances investor returns with positive social impact, fostering long-term resilience and inclusive development.

Source: The Brief

Eco Atlantic Secures Namibian Licence Extensions and Farms Out Sharon Block to Lamda Energy

Eco (Atlantic) Oil & Gas Ltd has successfully obtained extensions across all four of its Namibian petroleum exploration licences (PELs 97, 98, 99, and 100) and agreed to farm out its entire 85% stake in PEL 98 (Sharon Block) to Lamda Energy, a wholly Namibian-owned company.

• Licence Extensions:

  • One-year extension granted to the initial exploration period, now running until September 2026.

  • Optional two-year first renewal period, additional one-year extension, and optional two-year second renewal period available.

• Farm-Out Agreement:

  • Eco Atlantic farms out its entire 85% stake in PEL 98 to Lamda Energy, pending ministerial approval.

  • Lamda Energy, an experienced privately owned Namibian offshore operator, will assume all obligations and liabilities for the block.

  • Agreement includes an upfront payment for administrative costs to Eco, and provisions to earn up to US$2 million (about N$37 million) if Lamda later farms out part of its stake to third parties.

  • Eco retains a board seat to oversee the transition and ensure continuity.

• Strategic Focus:

  • Eco aims to concentrate on unlocking hydrocarbon potential in deeper water blocks (PEL 97, 99, and 100) aligned with updated work programmes.

  • Work plans include 3D seismic reprocessing for PEL 97 and 1,000 km² 3D seismic surveys plus processing on PELs 99 and 100.

• Environmental Clearance:

  • On 15 June 2025, the Ministry of Environment and Tourism issued an environmental clearance certificate allowing planned seismic activities in the Walvis Basin across Eco’s licences.

Strategic Importance:

• The farm-out deal and licence extensions optimize Eco Atlantic’s portfolio by focusing resources on high-potential deepwater assets while supporting Namibian local ownership in shallower blocks.

• Lamda Energy’s entry marks a significant step in increasing domestic participation in Namibia’s offshore oil and gas sector—a priority for the government and industry stakeholders.

Executive Comment:

Gil Holzman, Eco Atlantic President and CEO, said:
"These developments mark a key milestone in executing our tactical vision for Namibia. The support from the Ministry and our partners has been vital in aligning efforts on our deeper water licences, which attract growing industry interest. We remain committed to nurturing local partnerships and unlocking Namibia’s resource potential sustainably."

The Bottom Line:

Eco Atlantic’s extension of licences and farm-out of PEL 98 to a Namibian-owned company reflects its strategic shift towards deeper water opportunities while fostering local ownership. This balanced approach positions the company to contribute sustainably to Namibia’s oil and gas sector growth, supporting both economic development and domestic capacity building.

Source: The Namibian

TECH

Chinese AI Firm DeepSeek Reveals Ultra-Low Cost for R1 Model, Challenging US AI Industry Norms

Chinese artificial intelligence developer DeepSeek disclosed that training its R1 AI model cost just $294,000—a figure drastically lower than the hundreds of millions reportedly spent by US rivals. This rare update, published in a peer-reviewed article in the journal Nature, is set to reignite debate about China’s position in the global AI race.

Key Highlights:

• Training Cost Revelation:

  • DeepSeek spent only $294,000 to train its reasoning-focused R1 model.

  • Training utilized 512 Nvidia H800 chips, designed specifically for the Chinese market amid US export restrictions on more powerful chips.

• Comparison with US Firms:

  • US AI company OpenAI’s CEO, Sam Altman, stated in 2023 that training foundational models had cost “much more” than $100 million, though detailed figures remain undisclosed.

• Technology and Chips Used:

  • DeepSeek acknowledged using Nvidia’s A100 chips for early preparatory development stages.

  • Post-preparation, the full R1 model training was conducted over 80 hours on the 512-chip cluster of H800s.

• Model Distillation and Data Sources:

  • The company defended its use of model distillation—a method to develop new models based on learning from existing ones—as cost-effective and performance-enhancing.

  • Training data included a significant number of OpenAI-model-generated answers, potentially providing indirect knowledge transfer.

• Market Impact and Investor Reaction:

  • DeepSeek’s initial release of cost-effective AI models in January prompted a sell-off in global tech stocks as investors feared disruption to dominant AI players like Nvidia.

• Controversies and Skepticism:

  • Some US officials questioned claims about DeepSeek’s technological approach and chip procurement.

  • Nvidia stated that DeepSeek used lawfully acquired chips consistent with US export laws, denying claims of access to more restricted hardware.

Context and Implications:

DeepSeek’s cost disclosure challenges the notion that building powerful AI models requires massive financial outlays, suggesting that innovation in AI efficiency and model development can significantly reduce cost barriers. It also highlights ongoing tensions regarding technology transfer and export controls between the US and China in the AI field.

The Bottom Line:

DeepSeek’s unprecedentedly low-cost development of its R1 AI model exposes a new dimension in the AI industry—where efficiency and model distillation may bridge the competitive gap with heavy-investment US counterparts. This revelation fuels the conversation on China’s growing role in AI innovation, with implications for global tech competition, market dynamics, and regulatory scrutiny.

Source: CNN

UK-US Tech Prosperity Deal Marks Historic £31 Billion Investment Boost

Britain and the United States have sealed a landmark technology partnership, “Tech Prosperity Deal,” aimed at accelerating cooperation in artificial intelligence (AI), quantum computing, and civil nuclear energy.

Key Highlights:

• Historic Investment Package:

  • US tech giants including Microsoft, Google, and Blackstone pledged £31 billion ($42 billion) investment in the UK, the largest of its kind in British history.

  • Microsoft announced a £22 billion investment expanding AI infrastructure, including building the UK’s largest AI supercomputer in Loughton, northeast London.

  • Google committed £5 billion for a new data centre and enhanced AI research via DeepMind.

  • Nvidia will deploy 120,000 graphics processing units across the UK in its biggest European rollout.

  • Other investors such as Salesforce, CoreWeave, Scale AI, Oracle, and BlackRock have contributed sizable commitments.

• Bilateral Political Support:

  • The deal was signed during US President Donald Trump’s second state visit to Britain, with a state banquet and royal ceremonies at Windsor Castle.

  • Labour leader Keir Starmer and Trump praised each other’s leadership and commitment to deepening economic ties.

  • Starmer emphasized a “light-touch” regulatory approach favored by the US, contrasting with the European Union’s more interventionist stance.

• Strategic and Economic Significance:

  • The partnership aims to strengthen UK-US cooperation in cutting-edge technology, promote economic growth, and secure energy advancements.

  • Collaborative AI healthcare models, quantum computing capabilities, and civil nuclear projects are key components.

• Political and Diplomatic Context:

  • Starmer positioned himself as a bridge between Trump and European allies on key issues like the war in Ukraine.

  • The visit was shadowed by controversies, including diplomatic tensions over Jeffrey Epstein’s links and diverging UK-US positions on Gaza and Palestinian state recognition.

The Bottom Line:

The Tech Prosperity Deal crystallizes a historic surge in US investment into Britain, signaling renewed transatlantic innovation leadership and economic partnership. With commitments from top tech firms and high-level political backing, the pact sets the stage for Britain to become a global hub of AI and advanced technology development — even as some geopolitical complexities remain active.

Source: CNA

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