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BHC Claws Back to Profit
Aubrey Lute（https://weekendpost.co.bw/author/alute/） 4 days ago 962 14 min
The state developer swung to a P49.6 million profit after a punishing year, but the recovery leaned heavily on one-off asset disposals even as its core income fell by more than two-fifths.
Table 1 Botswana Housing Corporation, selected FY2026 results
Key figure FY2026 FY2025 Change
Revenue P427.5m P739.5m -42%
Profit / (loss) after tax P49.6m (P104.6m) +P154.2m
Operating profit / (loss) P28.0m (P116.8m) +P144.8m
Total assets P2.688bn P2.613bn +3%
Cash & equivalents P354.5m P467.5m -24%
Housing inventories P984.2m P709.6m +P274.6m
After a year that tested the limits of its balance sheet, the Botswana Housing Corporation has returned to the black, posting a profit after tax of P49.6 million for the twelve months ended 31 March 2026 – a dramatic reversal from the P104.6 million loss it absorbed a year earlier.
The P154.2 million turnaround, announced by the Corporation’s Board on 14 October 2026, reads at first glance like a clean recovery story. Look closer, and a more complicated picture emerges: the state-owned developer earned its way back to profit not by selling more houses or collecting more rent, but by banking P95.6 million in gains from the sale of investment properties and by sharply curbing the impairment charges that had savaged its previous results.
Strip out those property-disposal gains, and the Corporation would have reported an operating loss of roughly P67.6 million. That single figure frames the central tension in the year’s accounts – a business that is profitable on paper while its underlying engine sputters.
A revenue line in retreat
The most arresting number in the results is not the return to profit but the scale of the revenue decline. Revenue and rental income tumbled by P312.0 million, or 42.2 percent, to P427.5 million, down from P739.5 million the year before.
The fall was broad-based. Rental income, the Corporation’s most dependable stream, slipped to P279.1 million from P392.2 million. Construction and management contract revenue – the lumpier, project-driven side of the business – collapsed to P141.7 million from P336.8 million. Outright housing sales, long a modest contributor, brought in just P6.7 million, down from P10.5 million.
By year’s end the revenue mix told its own story of dependence: rental income accounted for roughly 65 percent of the total, construction and management contracts about 33 percent, and housing sales a slender 2 percent. The simultaneous erosion of both the rental book and the contract pipeline underscores, in the Board’s own framing, the need to defend the rental portfolio and keep a reliable flow of construction and management work moving through the business.
Margins up, costs stubbornly high
Beneath the revenue drop ran a current of improving profitability. Gross profit came in at P309.9 million, down from P441.4 million, but the gross margin widened to 72.5 percent from 59.7 percent as the cost of sales fell faster than revenue – dropping 61 percent to P117.5 million from P298.1 million.
Operating expenses excluding impairment were trimmed to P361.5 million from P412.5 million. Repairs and maintenance, often the first lever a landlord pulls, fell to P78.0 million from P110.7 million. Employee benefit expenses held broadly steady at P170.6 million – a figure that includes P15.5 million capitalised to housing inventories – while depreciation and amortisation came to P31.6 million and other expenses to P81.3 million. The Corporation closed the year with 295 employees, down marginally from 299.
Yet the cost discipline could not keep pace with the shrinking top line. The cost-to-income ratio climbed to 84.6 percent from 55.8 percent – a blunt measure of how much ground revenue has ceded to a cost base that simply did not fall far enough or fast enough.
The impairment reversal
If any single line rescued the income statement, it was impairment.