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GHOST BITES (Afrimat | Anglo American | Amplats | Aveng | CA Sales Holdings | Emira | Quantum Foods)

The Finance Ghost
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GHOST BITES (Afrimat | Anglo American | Amplats | Aveng | CA Sales Holdings | Emira | Quantum Foods)

Afrimat has reminded the market that this is a tough year (JSE: AFT)

The market’s love for Afrimat is reflected in the share price

If you read the tone of Afrimat’s business update, they really couldn’t make it more obvious that this won’t be a great financial year. In the interim period (the six months to August), HEPS was down by a rather spectacular 79.9%. Although the announcement suggests that the second half was better, it still feels impossible that they could’ve clawed back an interim period like that.

Despite this, the share price is essentially flat over 12 months. It’s unusual to see such a disconnect between the price and the earnings, even for a stock that is a market darling.

In the Construction Materials business, the integration of Lafarge South Africa has been completed and cement operations are at acceptable levels. Overall, this segment is poised for growth. This is obviously one of the things boosting the share price.

The Industrial Minerals side also has a positive story to tell, with Afrimat describing a significant recovery in that business.

In Bulk Commodities, Nkomati returned to profitability in January 2025. All eyes are on the new financial year, with commitments for 80% of the new year’s export volume. Of course, this doesn’t make up for all the issues in the financial year ending February 2025. Afrimat continues to face problems with rail performance, with the company focusing on the silver lining of “volumes have not deteriorated” rather than any kind of improvement coming through. Local iron ore volumes remain a challenge, with the ArcelorMittal disaster having been a huge drag on performance at the start of the year. Although things have improved since then, there’s much uncertainty around the position going forward.

The Future Materials and Metals part of the group is small for now, with design work at Glenover and ramp-up in the phosphate plant.

Afrimat has confirmed that earnings for the year will be lower than the previous year. After the interim performance, nobody is surprised to hear that. The debate of course is around just how much lower the full-year numbers will be. The share price feels too optimistic to me.

If you’re keen to hear directly from management, Unlock the Stock will host Afrimat as its first event of 2025. As always, you can attend the live webinar and ask your questions. The event is scheduled for 27th February, a few days after the pre-close briefing session that management is hosting. Our efforts at Unlock the Stock are designed to give you as much management access as possible, levelling the playing field for retail investors vs. institutional investors. Best of all, attendance is free! You just need to register here>>>

Anglo American has given more details on the Anglo Platinum demerger (JSE: AGL)

They will receive a meaty dividend before the time

On the same day that Anglo American Platinum released results and announced its dividend (see further down), Anglo American reminded the market of its plans for the demerger. The goal is to get it done by June, with Anglo retaining a stake of 19.9% that they will “exit responsibly” over time i.e. sell into the market in such a way as to avoid crashing the market price. For context, the current stake is a 67% shareholding.

Anglo American will ask its shareholders to vote on the demerger at the AGM at the end of April. This means that Anglo American will bank a dividend of around $0.6 billion before the demerger. Read on to properly understand this…

Anglo American Platinum declares a huge special dividend (JSE: AMS)

The PR spin is that this is to have a more efficient capital structure

Here’s a bit of fun for you. Anglo American Platinum (Amplats) has released its 2024 results. They are ugly, with headline earnings down 40% despite a 4% increase in sales volumes and a reduction in all-in sustaining cost per ounce of 13%. PGM prices remain a huge headache and Amplats obviously can’t do anything to control that.

That’s not the fun part. We are getting to the fun part.

Despite the pressure in the business, Amplats has declared a final dividend of R3 per share, which is a 40% payout. This shows that although earnings are down, they are still able to stick to their usual capital allocation plans.

In addition to this (and here’s the fun), they’ve declared a special dividend of R59 per share. That is absolutely huge, with R15.7 billion about to flow out of the company. Does this sound like the kind of thing a company in an uncertain environment should be doing? Wouldn’t it be better to retain that cash and possibly pick up some great bottom-of-the-cycle acquisitions?

Of course it would.

Now, the official story is that Amplats wants to “set its independent capital structure in the most efficient manner” – something you would normally see from a company making more money than they possibly know what to do with. That’s the kind of narrative I saw recently at JPMorgan in the US, for example. Amplats is not even remotely in that category.

Take the PR spin off it and it’s really quite simple: the mothership Anglo American wants to extract as much cash as possible before they demerge Amplats. Although Amplats will be cut loose with an acceptable balance sheet, they certainly aren’t being given an acquisition war chest to move forward with.

Aveng released results – and the share price still can’t find the bottom (JSE: AEG)

It dropped by another 4% on the day

After breaking hearts on Valentine’s Day with news of the group slipping into a loss-making position, the release of detailed results did nothing to improve the relationship with the market. Aveng’s share price is now down 28% over 7 days. Ouch.

This is what happens when your interim revenue for the six months to December drops by R2 billion and operating profit swings from positive R192 million to a loss of R356 million. Included in this number are losses from J108 and Kidston, the disastrous projects, of R885 million.

At headline level, this means a headline loss per share of R3.09 vs. positive HEPS of R1.06 in the comparable period. Keep in mind that the share price is only R8.61!

Although cash on hand has increased from R2.8 billion to R3.0 billion, don’t get too excited about that number. They’ve recognised losses in this period that will only see a cash outflow in months to come. The income statement is telling you a lot about what is likely to happen to the balance sheet.

Can they claw some of this back in the second half of the year? Well, it’s not great to see that work in hand is down sharply from R37.2 billion to R30.1 billion. There’s a reduction in state government spending in Australia that is impacting the infrastructure segment in the business and more than offsetting the improved order book elsewhere.

The projects causing all the pain were awarded before Covid. Aveng makes the point that newly awarded projects are profitable. The issue in construction is that every contract looks profitable initially, otherwise why would the company agree to do it? It’s what happens in the years thereafter that counts.

Aveng still intends to separate its group into Moolmans (South African mining sector focus) and McConnell Dowell (infrastructure etc. in Australia, New Zealand and Southeast Asia). It remains to be seen how exactly they will structure this. Naturally, such a shocking period for McConnell Dowell isn’t helpful to this strategy.

CA Sales Holdings locks in another bolt-on acquisition (JSE: CAA)

This time, it’s in Kenya

After a truly spectacular run in the share price, even CA Sales Holdings took a breather in the market recently. With a return of 36% in the past year and a year-to-date dip of 4%, the market still has plenty of love for the company. Just look at the sell-off suffered by most of the other consumer facing businesses listed on the JSE. CA Sales may not sell directly to consumers, but the underlying exposure via the retailers is similar.

The strategy has been a combination of organic growth and bolt-on acquisitions, with the group following a smart approach of buying significant minority stakes and obtaining a pathway to control. I far prefer this strategy to 100% buyouts, as it ensures that the sellers are still incentivised to keep growing the business. There’s a big difference between partnering with entrepreneurs and allowing them to pass you the baton of whatever they’ve built.

The latest such example is the acquisition of 35% of Tradco, a route to market solutions business in Kenya. It has reach into other East African countries. This is firmly in the wheelhouse of CA Sales Holdings in terms of business model, although it does represent a tilt towards a different region in Africa to most of the existing exposure.

Importantly, CA Sales has the potential to acquire another 20% in the company. This is the pathway to control that I spoke about.

Emira has released the DL Invest circular (JSE: EMI)

This is a Category 1 transaction

Emira already holds a 25% interest in DL Invest. At the time of investing in that stake in 2024, Emira was granted an option to increase the stake to 45%. The aggregation rules on the JSE mean that the combined deal is a Category 1 transaction. If we didn’t have aggregation rules, it would make it very easy to circumvent categorisation of deals (and thus shareholder approvals and extensive disclosures) by breaking deals up into smaller tranches.

Emira has decided that international exposure is the gap in its story. The company has a direct property portfolio in South Africa that represents 69.7% of gross assets. They have 17.6% exposure to the US market and the rest in Poland, represented by the existing DL Invest stake. This deal is therefore designed to increase the exposure to Poland.

If all goes ahead, DL Invest will be 20.8% of Emira’s total investments and will contribute 12% of net income. There’s a long story in the circular about how Emira can get the stake at a discount to net asset value thanks to all the good stuff that Emira will bring to the relationship. In reality, property deals are done at discounts to net asset value all the time, all over the world. There’s nothing unusual about that.

Castleview Property Fund (JSE: CVW) holds 59.15% of Emira and has given an irrevocable undertaking to vote in favour of the deal. As these are ordinary resolutions, the shareholder meeting is thus a dead rubber as Castleview can simply approve the transaction.

Emira will fund the deal through a combination of existing cash reserves and space in revolving credit facilities that was unlocked through the disposal of the Western Cape portfolio to Spear REIT. Should property funds be swapping Western Cape exposure for Poland exposure? That doesn’t really seem to be in line with current trends, does it?

Quantum Foods has a positive story to tell (JSE: QFH)

Well, aside from the chicken looting in Mozambique!

I haven’t seen any headlines in a while about all the fighting between the board of Quantum Foods and certain shareholders. The board also had a fight with one of the non-executive directors. TL;DR: there’s been a lot of fighting.

Luckily, there hasn’t been a lot of pain in the business in the four months to January 2025. Egg sales are up, load shedding has basically disappeared and there were no HPAI outbreaks. That’s clucking excellent in comparison to what came before.

Although egg selling prices were down 13% on average (fellow Eggs Benedict fans rejoice), Quantum was able to offset this impact by enjoying a 70% increase in egg supply. With all poultry producers in South Africa enjoying a recovery in their flocks, egg prices are expected to keep dropping. Of course, there is the ever-present risk of an HPAI outbreak, so nothing is certain.

The other segments (broiler farming and the feed business) were described as having a “satisfactory” performance, so that looks positive alongside the layer farming business.

The negative news in this period was in the rest of Africa, specifically Zambia (where load shedding is an issue) and in Mozambique. The latter is quite a story, with a crowd attacking the layer farm on 26 December 2024 and stealing 16% of the layer birds! You can’t make this stuff up.

Spicy chicken action in Mozambique aside, the share price is up 34% in the past 12 months.

Nibbles:

  • Old Mutual (JSE: OMU) CEO Iain Williamson has opted to take early retirement. He will step down on 31 August 2025 after an impressive 32 years with the company and 5 years as CEO. That’s quite an innings!
  • Transaction Capital (JSE: TCP) announced that the commitment agreement in relation to the Road Cover disposal has become unconditional in accordance with its terms. That deal should now be final, which means Road Cover will sit in Mobalyz (SA Taxi) as part of Transaction Capital’s contribution to that business to try and keep it alive.
  • Depending on how things go from here, Assura plc (JSE: AHR) might disappear from our market as suddenly as it arrived. The company has confirmed media speculation that it has received a preliminary, unsolicited approach from major institutional investors KKR and USS Investment Management. Although nothing is certain right now and it could all fizzle out, those companies have confirmed that they are considering a cash offer of 48 pence per share – a 28.2% premium to the share price on the London exchange on 13 February. The board keeps rejecting the proposals from the bidders, so this could end up going hostile with an offer directly to shareholders. Of course, things could just fizzle out as well. There’s very little liquidity in the stock on the JSE, as the market hasn’t had much of a chance to get to know Assura. It’s a large company, with a market cap of nearly R29 billion.
  • The potential deal between Europa Metals (JSE: EUZ) and Viridian Metals is off the table. The idea behind the transaction was to reverse list Tynagh via Europa Metals, as Europa has disposed of the Toral Project. The clock is ticking for Europa, as they have only a few months to make a qualifying acquisition under AIM listing rules in the UK. Reverse takeovers are fun things where a listed company goes in search of an asset to be injected into the company, usually in exchange for shares. The worry is that although the Tynagh project had decent economics, Europa has noted that European conditions are not conducive to finding funding for a project like this. That’s going to make this acquisition search a lot harder.

GHOST BITES (Aveng | Jubilee Metals | Metair)

The Finance Ghost
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GHOST BITES (Aveng | Jubilee Metals | Metair)

Aveng shareholders are licking their wounds (JSE: AEG)

The construction industry just loves breaking hearts

I don’t like to use the word “never” unless I absolutely have to, but I am very confident that I will never invest in the construction industry. It always strikes me as gambling rather than investing, as there’s just so much that can go wrong. Aveng is the latest example, with a 25% drop in the share price on Friday in response to the release of a trading statement.

Why the long face in the market? It’s simple, really: Aveng is loss-making in the latest period. They expect a headline loss per share of between A$26.0 cents and A$27.0 cents for the six months to December 2024.

For all the effort to make McConnell Dowell the focus of investors (hence the reporting in Australian dollars), it was that part of the business that broke in this period. In New Zealand and Pacific Islands, they were pretty flat year-on-year. As for Australia and Southeast Asia, there are various legacy projects that have ruined profitability.

It takes just two bad apples in the basket of projects to contribute losses of A$77 million, more than offsetting the rest of the projects that made profit of A$50 million in aggregate. I don’t like businesses that are this lumpy and carry these kinds of risks.

Aveng has recognised the forecast costs to complete these projects, so the pain is theoretically captured in these numbers. The same can’t be said for the cash outflows that are expected to materialise over the next 18 months. Aveng reckons that the current cash balance along with expected profitability in other projects will cover the outflows. I must of course remind you that if these forecasts were super reliable, there would be no such thing as loss-making projects in construction.

As for Moolmans, the South African mining-focused business, there are positive earnings for the period and they are close to finalising a new 60 month contract. It’s therefore purely the offshore business letting the team down, a story that is far too common for South African listed companies.

You won’t often see a chart nosedive like this:

Jubilee’s copper catch-up at Roan is underway (JSE: JBL)

The feed material is double the grade of material previously processed

After having suffered issues with the power supply to the Roan facilities in Zambia, Jubilee Metals needs to make up lost production. They are firmly in the process of doing exactly that, with the new high-grade copper feed material now being processed at Roan.

Jubilee recently announced that they had secured the rights to an initial 200,000 tonnes of this material, with the ability to get their hands on more of the stuff as well. Roan’s processing capacity is 45,000 tonnes per month, so this will keep them busy for a few months. The major benefit is that the high-grade material is roughly double the grade of the material that they previously processed, so this is part of an accelerated production plan to recoup lost production.

The share price is down 34% in the past six months and it doesn’t look like the momentum has turned just yet:

Metair is making a strategic shift (JSE: MTA)

I think they are tired of client concentration risks

If Metair didn’t have bad luck, they would have no luck at all. From hyperinflation in Turkey to floods at a key customer in South Africa, the world has dished up many a challenge for Metair in recent times.

The Turkish business really became a completely nightmare, with Metair eventually walking away with just $1 million in cash and a loss on sale of a breathtaking R4 billion. I will say it for the hundredth time: the track record in offshore investments for South African corporates is truly awful.

Thankfully, Metair seems to have recognised this, although they aren’t shy of taking on more risk in executing a strategy to be more focused on South Africa and to reduce customer concentration risks. The recently announced acquisition of Autozone comes at a time when group net debt is at R4 billion, most of which is short-term in nature. With a net debt to EBITDA ratio of between 3.4x and 3.6x, they are reliant on the lenders playing nicely with a refinancing package. There is a non-trivial chance of an equity capital raise being needed here, so tread carefully.

Moving on from these major strategic changes at the group, we find a set of results from continuing operations that don’t tell a promising story. For example, local vehicle production fell by 5%, with pressure at Toyota South Africa as a major drag on results. Although automotive battery volumes were higher in the Energy Storage business, Metair’s revenue from continuing operations fell by roughly 2.5% and EBIT is down by 21% at the midpoint of guidance. This included some once-off restructuring costs, without which the drop was 14.5% at the midpoint of guidance.

The net impact is a drop in HEPS from continuing operations of between 0% and 20%. This isn’t a position of strength for negotiations with banks. Even if there’s no rights issue coming, it’s likely that the cost of debt will be ratcheted in such a way that Metair spends the next few years working hard for the banks rather than shareholders.

The share price fell another 3.3% on the day, taking the one-year drop to a very ugly 48%.

Nibbles:

  • Director dealings:
    • There’s been some significant selling of shares by Richemont (JSE: CFR) executives. A member of the board sold shares worth R635k (with no indication that this was linked to stock compensation) and another board member sold shares worth R1.1 million (in this case linked to compensation, but it’s not clear whether it was the taxable portion or not).
    • The spouse of the CEO of Huge Group (JSE: HUG) bought shares worth R185k.
    • An associate of a director of Mantengu Mining (JSE: MTU) bought shares worth R133k.
    • The spouse of the CEO of Purple Group (JSE: PPE) bought shares worth R63k.
  • Labat Africa (JSE: LAB) has issued a sizable chunk of shares at a premium to the current traded price. The number of shares in issue has increased by 18.8% based on this share issue and the issue price was 12 cents per share, which is 50% more than the current traded price. The rand value is R17.7 million and the funds will be used to settle creditors and claims against the company.
  • Texton (JSE: TEX) announced that the aggregate holding of Heriot REIT (JSE: HET) and its subsidiary has ticked up to 22.77%.
  • Richemont (JSE: CFR) has done some juggling of its board and Senior Executive Committee, with three new appointments to that committee including the CEOs of two of the Maisons (one of which is Cartier). Not all of the Maison CEOs are automatically appointed to the committee. For example, one of the existing committee members is stepping down to become the CEO of Jaeger-LeCoultre.
  • Vodacom (JSE: VOD) and Remgro (JSE: REM) are still hoping for a positive outcome in the ongoing negotiations around the Maziv fibre deal. They’ve once again extended the transaction long stop date, this time to 14 March.
  • There is yet another delay to AYO Technology’s (JSE: AYO) financial results for the year ended August 2024. The auditor hasn’t yet finished the engagement quality control review, with AYO’s results now expected to be released by 28 February.
  • Delta Property Fund (JSE: DLT) announced that Brett Copans has resigned from the board as he is taking a role at a bank that has a business relationship with Delta and hence there would be a conflict of interest. You might remember his name from 2022 when he was appointed as Cell C’s chief restructuring officer. Some people really do enjoy turnarounds!
  • Fairvest (JSE: FTA | JSE: FTA) announced the appointment of Bridget Duker as an independent non-executive director. Again, I tend to ignore non-executive appointments, but in this case there’s a particularly impressive CV including previous stints as CFO of African Rainbow Capital Investments and COO and Head of Legal and Compliance at Rothschild & Co South Africa.
  • Trellidor (JSE: TRL) has added its name to the list of companies that have transferred to the General Segment of the Main Board of the JSE.
  • Deutsche Konsum (JSE: DKR) has zero liquidity in its stock on the JSE, so quarterly results only get a passing mention here. With a loan-to-value ratio of 54.7% (which is very high) and funds from operations per share down from EUR 0.23 to EUR 0.13, I personally don’t lose any sleep over the lack of trade in this company’s shares.

Woodstock ’99: a recipe for a riot

Dominique Olivier
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Woodstock ’99: a recipe for a riot

What do you get when you combine an unused airforce base, 220,000 teenagers, a couple of angry nu metal bands and some very expensive water? Part concert, part scene from an apocalyptic movie, the Woodstock festival that took place in 1999 was practically doomed from the start. 

Ah, Woodstock – the 1969 festival that became an evergreen symbol of peace, love, and music. For three days, a muddy field in upstate New York became the center of the universe. Jimi Hendrix shredded a psychedelic version of the national anthem, Janis Joplin wailed her heart out, and The Who kept the music going well past sunrise. It wasn’t just a festival – it was a movement. A harmonious blend of music, free expression, and a collective yearning for societal change.

It was also a beautiful accident. The organisers were wildly unprepared for the sheer number of people who showed up (400,000 instead of the expected 200,000), food ran out, the weather was brutal, and yet (somehow) it worked. Against all odds, Woodstock became the ultimate counterculture moment, proving that a generation disillusioned by war, consumerism, and authority could come together, peacefully, in the name of music and something bigger than themselves.

It was a great thing. So, of course, they tried to recreate it.

Woodstock ’94 was the first attempt to recapture the magic. It had some solid moments – Green Day’s infamous mud fight with the crowd, Nine Inch Nails playing while covered in filth – but it also showed the cracks in the dream. A rainstorm turned the site into a swamp, security was overwhelmed, fences were trampled, and thousands of people got in for free. What was supposed to be a financially successful event ended up losing millions.

But even that didn’t stop organisers from trying once again.

The stage is set

Michael Lang, the mastermind behind the original Woodstock and its muddier 1994 sequel, decided to give it one more go for the festival’s 30th anniversary. This time, he teamed up with New Jersey concert promoter John Scher, hoping the third time would finally be the charm.

Sure, the 1994 edition had been a financial disaster, but the dream of pulling off a massive, profitable festival was just too tempting to resist. The chosen venue? Griffiss Air Force Base in Rome, New York – a decommissioned military site and Superfund cleanup zone. Sounds charming. 

Determined to keep out gate-crashers, organisers erected a 3-metre-high plywood-and-steel “peace wall” and brought in 500 New York State Police troopers to guard it. Inside, the festival was an ambitious production featuring two main stages, a rave hangar, a sports park, and an Independent Film Channel-sponsored movie fest in a repurposed airplane hangar.

Even in the planning stages, it became clear very quickly that Woodstock ‘99 wasn’t about peace and love – it was about profits and logos. Corporate sponsors were everywhere, vendor “malls” sold overpriced essentials, and modern conveniences like ATMs and email stations reinforced the festival’s commercial edge. Ticket prices reflected the shift: $150 in advance (around $290 or R5,300 today) or $180 at the gate. They say you can’t put a price on making memories, but the organisers of Woodstock ‘99 sure gave it their best shot. 

The descent into mud

As you’ve probably guessed by now, none of this ended well. In fact, there’s even a great Netflix documentary on what happened. With temperatures soaring past 38°C for the majority of the festival, the decommissioned Griffiss Air Force Base turned into a sweltering heat island. Vast stretches of concrete and tar soaked up the sun all day and radiated heat well into the night, leaving 220,000 festivalgoers with nowhere to escape. Shade was scarce, and with camping spots on the grass filling up almost immediately, many were left pitching their tents on the blistering tar.

The trek between the East and West stages was a grueling 3.7 km march across scorching pavement. And if the heat didn’t break festivalgoers spirits, the prices would. Thanks to aggressive cost-cutting, vendors were given free rein to set their own prices, leading to gouging that bordered on extortion. Bottled water was sold at $4 ($7.70 or R140 today). By Sunday, low stock levels and high demand meant that vendors were selling that same water for $12 ($23 or R420 today). Food supplies dwindled, and outside snacks had been confiscated at the gates, leaving many with no choice but to suffer through long lines or take a crowded bus to the nearest town’s stores, where shelves were quickly emptied.  

The free water fountains seemed like a lifeline, but with massive queues and patience running thin, festivalgoers started breaking pipes to access water faster. This quickly resulted in mud pits forming all over the site. But these weren’t just any mud pits. Thanks to overflowing, under-maintained portable toilets, the water mixed with human waste, creating a literal cesspool of filth. Unaware (or just beyond caring), attendees jumped in to cool off, leading to outbreaks of trench mouth, trench foot, and general horror.

Trash cans were few and far between, and the ones that were there either overflowed or were repurposed as makeshift drums and rolling toys. Sanitation workers, overwhelmed or just unwilling to deal with the chaos, stopped showing up altogether, leaving the site to drown in its own filth. By the time the weekend was over, Woodstock ‘99 was less a music festival and more a dystopian survival experiment. And the worst was yet to come.

Break stuff

By Saturday night, Woodstock ‘99 had gone from plain gross to outright dangerous, with violence and destruction peaking during Limp Bizkit’s set. The crowd was already on edge, but when the band launched into Break Stuff, it was as if someone had flipped a switch. Mosh pits turned violent, plywood barriers were torn down and repurposed for crowd-surfing, and smaller buildings near the stage were ripped apart. At one point, massive chunks of plywood collapsed under the weight of concertgoers, sending people crashing onto others below.

Things only escalated from there. By Sunday night, as Red Hot Chili Peppers played Under the Bridge, a well-intentioned candlelight vigil for the Columbine shooting victims spiraled into something far darker. Some attendees used the candles to start fires, feeding the growing bonfires with whatever they could find – trash, plywood, even pieces of the supposedly indestructible perimeter “peace wall”. Flames quickly spread to both stages. When an audio tower caught fire, the fire department was called, but they refused to enter the festival grounds, fearing the increasingly hostile crowd. The tower eventually collapsed as people climbed its scaffolding.  

Then came the festival’s grand finale: a laser show combined with Jimi Hendrix footage from Woodstock ‘69. But after days of suffering through brutal heat, overpriced essentials, and deteriorating conditions, the exhausted and furious crowd wasn’t exactly in the mood for nostalgia. The moment the show ended, mayhem erupted. ATMs were tipped over and looted, vendor booths were ransacked and torched, and trailers full of merchandise and food were broken into. In total, around $22,000 was stolen from the ATMs alone. Festival staff barricaded themselves inside control towers, while the few vendors still onsite abandoned their posts and ran.

By 23:45, law enforcement had finally had enough. Between 500 and 700 state troopers and local officers (many in riot gear) moved in, pushing the crowd away from the burning stages. Some rioters resisted, others scattered into the campground. The fires burned well into the morning before order was finally restored. What was meant to be a celebration of Woodstock’s legacy had ended in flames – both literally and figuratively.

Some things just can’t be monetised

If Woodstock ‘69 was about rejecting the system, Woodstock ‘99 was an illustration of what happens when the system runs the show. The original music festival in 1969 may have been chaotic, but it was real because it was built on a spirit of community and rebellion. Thirty years later, that spirit had been repackaged, sold off to the highest bidder, and drowned in sponsorship deals. 

What was meant to be a tribute turned into a cautionary tale, proving that you can’t mass-produce a movement or cash in on a legacy without completely losing what made it legendary in the first place.

Editor’s note: Limp Bizkit is the one band that this ghost still hopes will come to South Africa – preferably without cancelling the tour this time. Also, in a context other than the chaos of Woodstock ’99!

About the author: Dominique Olivier

Dominique Olivier is the founder of human.writer, where she uses her love of storytelling and ideation to help brands solve problems.

She is a weekly columnist in Ghost Mail and collaborates with The Finance Ghost on Ghost Mail Weekender, a Sunday publication designed to help you be more interesting. She now also writes a regular column for Daily Maverick.

Dominique can be reached on LinkedIn here.

GHOST BITES (Barloworld | British American Tobacco | Caxton | iOCO | Italtile | Sibanye | South32)

The Finance Ghost
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GHOST BITES (Barloworld | British American Tobacco | Caxton | iOCO | Italtile | Sibanye | South32)

The offer to Barloworld shareholders is as good as its going to get (JSE: BAW)

Just how far will the fight with Silchester go?

UK-based Silchester International Investors holds around 17.7% of the shares in Barloworld and they are angry about the proposed take-private of the company. This has been playing out in various media headlines rather than on SENS, with Silchester making it clear that not only will they vote against the proposed deal, but they will also look to take further action in pursuing board changes in response to what they perceive as governance failures.

We will have to see what happens in terms of any shareholder activism here regarding the board. In the meantime, we now know that the consortium making the offer will not be increasing the price on the table. R120 per share is as high as it gets, despite Silchester indicating that they would consider at least R130 per share.

In percentage terms, that’s only 7.7% off what Silchester has indicated as a price that they would accept. Will they blink and change their approach on the deal, with a surprise “yes” vote in the pipeline? Barloworld has had mixed fortunes, with the share price trading below R100 for literally all of 2024 – and often well below that level.

Investors in Bell Equipment were also stubborn about the offer price on that proposed deal. It was priced at R53 per share and was blocked by activist shareholders. Bell is now trading at R39 per share.

I look forward to seeing how this plays out!

There is very little growth at British American Tobacco (JSE: BTI)

I still don’t see the appeal here

British American Tobacco is trading on a trailing dividend yield of roughly 7%. Once you adjust for the tax difference between company dividends and distributions from REITs, this puts it roughly in line with a number of REITs in terms of yield.

But here’s the thing: property isn’t a sunset industry. I also don’t see regular headlines about countries wanting to ban properties from existing, but the same certainly can’t be said for vapes and related products. Even the “Smokeless World” concepts that the PR consultants get paid a fortune to come up with aren’t exactly flying off the shelves. Reinet (JSE: RNI) recently sold its entire stake in British American Tobacco, so there’s another strong indication that there isn’t much growth here.

Over three years, the share price is up 2%. Not 2% per year – 2% in total. You get the dividend and not much else here, aside from some major swings to keep traders interested (like a 24% rally in the past 12 months).

Why has this thing run out of puff? Well, even if they perform in line with mid-term guidance, that’s only revenue growth of 3% to 5% and adjusted profit from operations growth of 4% to 6%. I’ll ask again – why not just buy the REITs? I hear the argument that smoking is more defensive (after all, it helps when people are addicted), but that only matters for short terms in any kind of long-term investment horizon.

Also, it’s not as though British American Tobacco hits that guidance all the time. For the year ended December 2024, organic revenue at constant rates was up 1.3% and adjusted organic profit from operations increased 1.4%. The New Categories business is finally making a profit at least, now contributing 17.5% of group revenue.

One of the major issues in 2024 even on an adjusted basis was the US market and a 10.1% decrease in volumes. Without adjustments, group revenue fell by 5.2% thanks to the sale of the businesses in Russia and Belarus.

Looking ahead to 2025, I’m very pleased to see that global tobacco industry volumes will be down 2%. The world is getting healthier. This means that they expect revenue growth of just 1% and adjusted profit from operations growth of 1.5% to 2.5%, so that’s a long way off the mid-term guidance.

The share price fell 8.3% off the back of these numbers. In case it isn’t super obvious, I have no position here.

Caxton’s focus on margins has kept profits on the right path (JSE: CAT)

Revenue remains a concern though

Caxton and CTP Publishers and Printers (which everyone just calls Caxton) has released a trading statement for the six months to December 2024. Although revenues declined marginally (we don’t have the exact percentage yet), HEPS actually moved higher by between 9.3% and 15.2%.

Caxton operates in certain verticals that feel like they could be sunset industries, particularly the community newspapers. They are working on running those businesses as efficiently as possible, while venturing into other areas that have better long-term prospects. It therefore makes sense to see a combination of weaker revenue and better profitability, as the shape of the group is changing over time.

We will have to wait for the release of results on 4th March for full details.

iOCO (formerly EOH) rallied on the release of a trading statement (JSE: IOC)

These numbers provide a clearer view of what is now in the group

After a volatile turnaround period that included major changes to the group and its capital structure, executives at iOCO must be feeling good about being able to release a simple set of numbers into the market. Gone is the massive headline loss per share in the comparable period. Instead, HEPS for the six months to January 2025 is expected to be between 19 cents and 21 cents.

The share price closed 10.6% higher at R2.82. If we just annualise this interim performance (a dangerous thing to do but sometimes a helpful rule of thumb), the forward P/E is roughly 7x. That’s modest if there are genuine growth prospects for the group. I must warn you – that’s a big if.

Marius de La Rey has resigned as interim CEO, so he won’t be delivering that growth. The company is taking the route of joint CEOs, a structure that I hate. Two existing non-executive directors will take that role, namely Rhys Summerton and Dennis Venter. Summerton will be focused on capital allocation decisions and group strategy, while Venter will work on revenue generation initiatives.

Most companies just split this into a CEO and business development head, but that would require choosing one of these execs to actually be ultimately responsible for performance going forward. The choice of the joint-CEO route is worrying as shared accountability can quickly become no accountability.

In a letter from the new joint CEOs, they talk about creating a culture of “radical autonomy” within the business units. No, the irony of a group giving divisional executives more power while failing to choose one group CEO isn’t lost on me.

Italtile’s earnings are in the green (JSE: ITE)

Given all the worries around the manufacturing segment, this is better than I expected

Italtile’s management team worked hard to stop the market from having high expectations about the company’s earnings. There were multiple warnings about overcapacity in the local tile manufacturing industry, which would naturally put pressure on prices and the ability to absorb overheads. Also, we haven’t exactly seen a rush of consumers into durable goods yet, despite the GNU and a dip in interest rates.

Against this backdrop, I expected a flat or even negative earnings trajectory at Italtile. Instead, the company managed to grow HEPS by between 2% and 6.7% for the six months to December 2024. The market response was muted, with the price closing flat for the day. The year-to-date move is a nasty 15.6% drop.

Over the past 12 months though, my preference for Cashbuild in this sector has proven to be the right decision:

Sibanye Stillwater bids farewell to Neal Froneman (JSE: SSW)

Froneman is retiring from the company that he is synonymous with

Here’s big news from the PGM (and I suppose gold) sector: Neal Froneman has decided to retire as CEO of Sibanye-Stillwater with effect from 30 September 2025. Of course, you have to wonder if this means that his outlook on the PGM sector is that any improvement will take too long to come to fruition, so he may as well call it a day. The recent narrative in the sector hasn’t exactly been positive and Sibanye has had many troubles to deal with, so perhaps he’s just gatvol. The official line, of course, is that he wants to spend more time with his family and on his interests. Fair enough. We just know from experience that one of his interests is to get paid an eyewatering amount of money at the top of the cycle.

Whatever the reason, it means that Richard Stewart (currently Chief Regional Officer of the Southern Africa region) will be appointed CEO-designate with effect from 1 March 2025. He’s been with the group since 2014, so that’s a long innings to get to this point. He has his work cut out for him with a share price that is down 54% over five years.

South32: an operating leverage exhibition (JSE: S32)

When revenue jumps, the percentage change in profit can be epic

Mining groups have incredibly high fixed costs. This means that in the bad times, they really suffer. In the good times, they make a fortune. The best way to see and understand this is to look at the impact of an incremental increase in revenue.

For the six months to December 2024, South32’s revenue jumped by 25%. In dollars, this means an additional $616 million in revenue came into the group. Now, how much of that “dropped to the bottom line” i.e. to what extent did profits increase?

Seeing a 579% increase in profit isn’t meaningful, as there was a low profit base in the comparable period. It’s more helpful to see that profit went up by $307 million. This means that essentially half of the additional revenue in the group popped out as profit after tax. How’s that for a profit margin?

How did they do it? Well, in the Alumina business, production fell 2% but a 53% increase in average realised prices meant that profits shot through the roof. Aluminium saw a 16% increase in prices, with a 5% increase in production helping to turbocharge that result as well.

Moving on to copper, production increased by 21% and prices were higher as well, so profits shot up by 84%. Even nickel, a metal with tough dynamics at the moment, saw a sharp increase in profit thanks to cost efficiencies and other projects. South African Manganese is a small contributor, but still added to the positive vibes with profit doubling for the period.

It can’t all be rainbows and unicorns, of course. Zinc saw a dip in profits as production fell by 17%. Australia Manganese had Tropical Cyclone Megan to deal with, so they made losses there as well.

Overall, this was a strong result that was accompanied by a drop in capital expenditure, which means free cash flow was boosted. The sale of Illawarra Metallurgical Coal dealt with almost all of the debt on the balance sheet as well, so the group is in incredible shape.

The share price closed 6% higher in response.

Nibbles:

  • Director dealings:
    • The CEO of Vodacom (JSE: VOD) has sold shares worth R20 million. This comes after a strong rally in the share, so I would treat that as a signal that the share price is overcooked.
    • The CEO of British American Tobacco (JSE: BTI) reinvested dividend income to the value of £6.7k in shares.
  • Labat Africa (JSE: LAB) closed 16.7% higher after announced that HEPS for the six months to November 2024 will be 98.72% higher year-on-year. That’s a huge jump of course, but seeing percentage moves like this off a depressed earnings base isn’t that uncommon. The group is going through a major change at the moment.
  • Stefanutti Stocks (JSE: SSK) has moved its listing to the General Segment of the Main Board. It’s been a couple of weeks since we saw one of these announcements, with the company joining a sizable list of other small- and mid-caps that have made the move in search of simpler disclosure requirements.

Who’s doing what this week in the South African M&A space?

Marylou Greig
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Who’s doing what this week in the South African M&A space?

Exchange-Listed Companies

The consortium, comprising Entsha which is ultimately owned by Barloworld CEO Dominic Sewela and the Zahid Group, offering to buyout minorities of Barloworld has issued a statement confirming there will be no increase in the current final offer price of R120 per share. This, despite 17.7% shareholder UK-based Silchester rejecting the offer stating it was looking for R130 per share. Independent Expert, Rothschild & Co, reported a valuation range of R105.53 to R119.43 per share as fair and reasonable. The PIC which holds c.19% is yet to disclose whether it will accept the offer.

Tongaat Hulett, the embattled sugar producer in Business Rescue, has signed an agreement with Ball Foundry (Vision parties) to dispose of its operations in Mozambique. The assets are held in three entities which include 85% of Tongaat Hulett Açucareira de Moçambique SA. The Mozambique government will hold the remaining 15%. The purchase price payable by Vision will be the fair market value and set off against a portion of the Lender Group Claims – to be announced in due course. Late last year and in January this year, the Vision parties announced the acquisition of the assets in South Africa, Zimbabwe and Botswana.

DealMakers is SA’s quarterly M&A publication.
www.dealmakerssouthafrica.com

Weekly corporate finance activity by SA exchange-listed companies

Marylou Greig
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Weekly corporate finance activity by SA exchange-listed companies

Following the results of the dividend reinvestment plan, Sirius Real Estate purchased 81,958 shares in the market at an average price of £0,7740 per share and 1,381,364 shares in the market at an average price of R18.37 per share.

The JSE has approved the transfer of the listing of Stefanutti Stocks to the General Segment of Main Board with effect from 14 February 2025. The listing requirements in this segment are less onerous for the smaller and mid-cap firms.

This week the following companies repurchased shares:

Schroder European Real Estate Trust plc acquired a further 299,200 shares this week at a price of 66 pence per share for an aggregate £197,472. The shares will be held in Treasury.

In October 2024, Anheuser-Busch InBev announced a US$2 billion share buy-back programme to be executed within the next 12 months which will result in the repurchase of c.31,7 million shares. The shares acquired will be kept as treasury shares to fulfil future share delivery commitments under the group’s stock ownership plans. During the period 3 – 7 February 2025, the group repurchased 1,392,295 shares for €65,97 million.

Hammerson plc continued with its programme to purchase its ordinary shares up to a maximum consideration of £140 million. The sole purpose of the buyback programme is to reduce the company’s share capital. This week the company repurchased 322,856 shares at an average price per share of 291 pence.

In line with its share buyback programme announced in March 2024, British American Tobacco plc this week repurchased a further 574,667 shares at an average price of £33.69 per share for an aggregate £19,35 million.

During the period February 3 – 7 2025, Prosus repurchased a further 4,990,388 Prosus shares for an aggregate €189,3 million and Naspers, a further 360,878 Naspers shares for a total consideration of R1,45 billion.

Two companies issued profit warnings this week: Pan African Resources and Impala Platinum.

During the week, four companies issued cautionary notices: TeleMasters, PSV, Santova and Kap.

DealMakers is SA’s M&A publication.
www.dealmakerssouthafrica.com

Understanding Statement 102 within SA’s B-BBEE framework

Leigh Lambrechts and Loatile Baiphaphele
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Understanding Statement 102 within SA’s B-BBEE framework

The Broad-Based Black Economic Empowerment (B-BBEE) Act of 2003 (the Act) is an important part of the South African legal landscape. One aspect of the Act used to measure compliance with the Act is how businesses are classified according to their B-BBEE level, ranging from the highest – Level 1 – to the lowest, Level 8; or worse, non-compliance. A points system is used to adjudicate a business’s compliance with the Act and allocate a B-BBEE level.

Businesses receive points through several means, ranging from the shareholder or ownership makeup of the business and how the business procures services and products from previously disadvantaged suppliers, to how skills development occurs in a service agreement or commercial relationship. For large businesses operating in South Africa, both foreign and domestic, a clear understanding of how the B-BBEE points system works and the best ways it aligns with overall business strategy can create exciting commercial opportunities within South Africa’s private and public sectors.

One such way a business can earn B-BBEE points is through the different options provided by Statement 102 of the B-BBEE Codes that form part of the Act. Statement 102 merits greater investigation because points earned under it allow the seller to claim the benefit of the sale for their B-BBEE scorecard.

What is Statement 102 and which transactions qualify?

Statement 102 refers to a business sold under its auspices as a Separately Identifiable Related Business (SIRB). A SIRB is defined as a “business that is related to the seller by being a subsidiary, joint venture, associate, business division, business unit, or any other similar related arrangements within the ownership structure of the seller”.

Statement 102 addresses how B-BBEE points are assigned through the transfer of ownership of a company to previously disadvantaged persons by another company. Three qualifying transactions can lead to the ownership of a SIRB changing hands from one party to another. These are the sale of certain assets; equity instruments in an entity; and a business.

For ownership points to be recognised, the qualifying transaction must:
*result in the creation of viable and sustainable businesses or business opportunities in the hands of black people; and
*result in the transfer of critical and specialised skills, managerial skills, and productive capacity to black people.

Critically, while a sale may meet the criteria of a qualifying transaction under Statement 102 at a high level, no B-BBEE points will be awarded if the transaction does not result in the transfer of critical and specialised skills or productive capacity to previously disadvantaged communities. Furthermore, the business must be a viable and sustainable enterprise so that beneficiaries do not fall victim to fronting and other nebulous practices that seek to circumvent B-BBEE law. No unreasonable limits or conditions relating to conditions of sale should exist.

Transactions that do not qualify under Statement 102

As noted above, over the years, numerous companies – whether unknowingly or otherwise – have sought to accrue B-BBEE points through practices that do not meet the conditions laid out in the B-BBEE Act. It can be quite costly for a business to engage in a transaction that they believe will improve their B-BBEE status when, in reality, it will go unrecognised according to the Codes and Statement 102. As such, it can be as important to know which transactions do not qualify under the Statement, as knowing which do.

The following transactions do not qualify under Statement 102:
*Business rights transferred through a license, lease or a similar legal mechanism that does not confer unrestricted ownership.
*The sale of a franchise by a franchisor to a franchisee (however, sales by franchisees to other franchisees or new franchisees do qualify).
*If a repurchase transaction is entered into within a stipulated period after the transaction has been implemented, even if transaction implementation is deferred post-year.

Furthermore, ownership points under the Act are subject to existing contracts between the parties remaining in effect, subject to levels that represent expected and reasonable market norms.

When comparing the transactions that qualify under Statement 102 with those that do not, it becomes increasingly clear how the Statement and broader Act strive for meaningful change when ownership of a business changes hands in South Africa.

The excluded transactions are done so because they do not practically guarantee the beneficiaries of the transaction either the sustainable transfer of skills and/or meaningful business control to be used as a platform for future wealth creation.

Given the opportunities presented by Statement 102 and the Act, and having explored some of the complexities above, it is highly advised that sound legal advice is sought when engaging in a transaction, to ensure all parties benefit from its execution materially and within the B-BBEE framework.

Leigh Lambrechts is a Partner and Loatile Baiphaphele an Associate | Webber Wentzel.

This article first appeared in DealMakers, SA’s quarterly M&A publication.

DealMakers is SA’s M&A publication.
www.dealmakerssouthafrica.com

Unlocking Namibia’s potential: Trust Administration in a thriving economy

DealMakers
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Unlocking Namibia’s potential: Trust Administration in a thriving economy

Trust administration and management are global practices essential for wealth planning and asset protection. While Namibia may be lesser-known, compared to established jurisdictions like Jersey and Guernsey, it is quickly emerging as a key player in this space, offering a robust regulatory environment. These well-known offshore financial centres are renowned for their strong legal frameworks, offering flexibility, privacy, and asset protection. Investors often choose these jurisdictions for their stable, transparent systems and global recognition, making them prime choices for high-net-worth individuals seeking comprehensive wealth protection.

Namibia, though different in scale, shares many of these benefits. Bravura recognised early the growing demand for trust administration services. Initially established to manage internal structures, Bravura Administration Services (BAS) quickly identified a need in the market to assist clients with personal trust administration, especially following new regulations. These regulatory updates introduced hefty penalties for non-compliance, making it essential for clients to have a reputable partner to ensure that trusts remained compliant. Bravura, with its long-standing relationships and vast network, stepped in to help clients navigate these complexities and achieve the same high standards of administration, meeting international criteria.

The Namibian economy further supports this burgeoning demand for wealth management. According to the African Development Bank, Namibia’s projected GDP growth is 3.8% in 2024 and 4.2% in 2025. This steady growth, driven by Namibia’s ties to the Southern African Development Community (SADC) and its expanding energy sector, creates fertile ground for long-term wealth management strategies, including trusts. Establishing a trust in Namibia allows individuals to safeguard their assets, minimise tax exposure, and ensure a seamless transfer of wealth across generations.

Bravura’s Namibian office is a team of nine, led by Willem Bodenstein. Today, BAS administers more than 100 trusts and companies, managing a growing portfolio of client assets. The company has fostered strategic partnerships with leading law and audit firms in Namibia, combined with the knowledge, networks and resources that Bravura’s South African office can tap into. This allows BAS to remain up-to-date with all relevant laws and regulations, while providing access to top talent and skills. This symbiosis results in access to leading industry experts, and ensures that clients receive world-class service and the confidence that their trusts are compliant with the latest regulations.

We are able to leverage cutting-edge technology and real-time dashboards to ensure compliance and efficiency, and it’s been rewarding to see the systems we’ve invested in deliver such positive results for both BAS and our clients. Our Corporate and Trust division recently underwent a Financial Intelligence Centre (FIC) audit, and the outcome was extremely positive.

As BAS continues to grow and serve its clients, its ability to collaborate with top investment managers, while maintaining independent oversight, ensures that trusts and corporate structures are managed to the highest standards. For investors seeking both stability and opportunity, a trusted fiduciary service provider is essential to navigate the local and global requirements for safeguarding assets and preserving wealth for future generations.

Willem Bodenstein is Head and Nicola Van Rooyen is Corporate and Trust Manager | Bravura Namibia

This article first appeared in DealMakers AFRICA, the continent’s quarterly M&A publication.

DealMakers AFRICA is a quarterly M&A publication
www.dealmakersafrica.com

GHOST BITES (KAP | Pan African Resources | Northam Platinum | Trellidor)

The Finance Ghost
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GHOST BITES (KAP | Pan African Resources | Northam Platinum | Trellidor)

Alas, interim earnings are down at KAP (JSE: KAP)

The ramp-up of the new PG Bison line has impacted earnings

KAP has released a trading statement for the six months to December 2024. With the share price up roughly 26% in the past year, investors have been reaping the benefits of improved sentiment around South Africa. Here’s the catch though: that sentiment doesn’t last unless earnings catch up to the share price.

At KAP, this hasn’t happened, at least not in the interim period. HEPS has dropped by between 19% and 23%, so it should be in the range of 16.7 cents to 17.7 cents.

The company has laid the blame at the door of the PG Bison ramp-up, where the new line is not running at optimal levels just yet. That sounds to me like a demand problem to be honest, particularly as they talk about “making good progress on selling the additional volume” – so was it a production problem during ramp-up, or a sales problem? Seems like the latter to me.

KAP is a highly diversified group, so it’s also unlikely that the sole source of pressure was in PG Bison. We will have to wait until the release of results on 27 February to know for sure.

Pan African Resources continues to slide (JSE: PAN)

The market really isn’t impressed with the recent numbers

The Pan African Resources share price has fallen over 14% in the past week. To put that sell-off in context, it’s important to look at the share price over the past year as gold shone brightly:

Those who enjoy tactical entry points in a broader bull trend are probably paying attention now.

The reason for the market’s irritation is production for the six months to December 2024, which was 3.3% lower. There were some production issues during the period, yet Pan African Resources reckons that they can claw it back in the second half and still meet 2025 production guidance. Suddenly, that chart is looking even more interesting, isn’t it?

Naturally, improved production in the second half of the year is also expected to lead to a lower all-in sustaining cost per ounce for H2 relative to H1. Mining is unpredictable though, so there’s always risk of further operational issues (like the Eskom transformer failures that were suffered at Barberton Mines in the interim period).

They also expect to grow production in FY26, boosted by projects like the Mogale Tailings Retreatment operation and Tennant Consolidated Mining Group in Australia.

Here’s another reason why I am pulling the trigger on this chart and adding Pan African to my portfolio: the gold forward sale transaction expires at the end of February, which means that the company can enjoy the full benefit of current gold prices in the second half of the year.

PGM basket prices continue to haunt Northam Platinum (JSE: NPH)

There’s a substantial drop in interim earnings

Northam Platinum released a detailed trading update and trading statement dealing with the six months to December. Despite a 3.7% increase in equivalent refined metal from its own operations, there was a 2.5% decrease in refined metal produced due to planned maintenance.

When you combine this with a 3.5% drop in the 4E basket price (measured in ZAR) and a 7.7% increase in group unit cash costs per equivalent refined 4E ounce, there’s going to be a rough story to tell at headline earnings level. Indeed, HEPS is down by between 44.7% and 54.7%.

With operating profit margin down drastically from 16.1% to 7.5%, things need to improve in the sector or there’s going to be serious trouble. The mines are still profitable for now, but inflationary impacts on costs aren’t going away. The only way for things to get better is for the PGM prices to go up, with the mining houses doing all they can to manage costs and their balance sheets in the meantime.

Trellidor finally has reason to celebrate (JSE: TRL)

You won’t often see a share price jump 42% in a day

As share price charts go, Trellidor is one of the more incredible ones:

Stocks that are lightly traded and which show significant earnings volatility can end up having breathtaking one-day moves. The latest one is in the right direction at least, taking the stock 42% higher and back to where it was trading in mid-2023.

The reason? Simply, a jump in earnings. HEPS for the six months to December will be between 33% and 43% higher, coming in at between 28.53 cents and 30.67 cents. They attribute much of this to the Trellidor UK division, which says rather a lot about what’s changing in the UK. The Taylor and NMC divisions also improved.

Nibbles:

  • South32 (JSE: S32) released the happy news that the Worsley Mine Development Project has received Federal environmental approval in Australia. This project gives access to bauxite to sustain production at Worsley Alumina, which will also support ongoing jobs in the region.
  • Universal Partners (JSE: UPL) has almost no liquidity in its stock, so I’m not covering the results in detail on an otherwise busy day of news from companies that you can actually trade. I’ll just give it a passing mention that for the six months to December 2024, the net asset value per share decreased by 6.7% year-on-year. And yes, in case you’ve followed them closely, they still have a business unit that “reinvented the toilet” and yet is carried at a nominal investment value. Apparently, people are happy with their current toilets!
  • BHP Group (JSE: BHP) has announced that its Chair, Ken MacKenzie, will retire at the end of March 2025 after serving since September 2016. That’s a solid innings! His replacement is Ross McEwan, who has been an independent non-executive director of the company since April 2024. His prior executive experience is mainly in the banking industry, which is interesting. That speaks directly to capital allocation skills and perhaps even future M&A?
  • Brimstone (JSE: BRT) has released a trading statement. Normally, such a thing would be in the top section of Ghost Bites instead of the Nibbles, but the issue is that Brimstone’s trading statement is based on the movement in HEPS rather than in net asset value (NAV). This makes it quite useless really, as nobody should be using HEPS to assess performance at Brimstone. If for some reason you do though, HEPS is up by between 46% and 56% for the year ended December 2024. There are a million reasons why HEPS isn’t helpful here, not least of all because of the impact of Sea Harvest no longer being a subsidiary of Brimstone after the Terrasan Group deal. Brimstone’s share price is flat over 12 months, which shows you how much attention the market pays to HEPS at an investment holding company.
  • As regular readers know, I generally ignore non-executive director appointments as they are rarely of great relevance to investors. From time to time, more experienced appointments are worth touching on. I think it deserves a mention that SA Corporate Real Estate (JSE: SAC) has appointed Janys Ann Finn to the board. As the ex-CFO of Redefine Properties and Rebosis Property Fund among others, she brings a ton of experience to the Audit and Risk Committee.

PODCAST: Budget 2025 – what to expect

Investec No Ordinary Wednesday
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PODCAST: Budget 2025 – what to expect

Listen to the podcast here:

With a challenging economic landscape, fluctuating currency, global trade tensions, and ongoing energy struggles what can South Africans, businesses and investors expect from Finance Minister Enoch Godongwana’s 2025 Budget Speech? In this special edition of No Ordinary Wednesday, Investec experts Chief Economist Annabel Bishop, Treasury Economist Tertia Jacobs and Chief Investment Strategist Chris Holdsworth share their predictions for Budget 2025.

Hosted by seasoned broadcaster, Jeremy Maggs, the No Ordinary Wednesday podcast unpacks the latest economic, business and political news in South Africa, with an all-star cast of investment and wealth managers, economists and financial planners from Investec. Listen in every second Wednesday for an in-depth look at what’s moving markets, shaping the economy, and changing the game for your wallet and your business.

Also on Spotify and Apple Podcasts:

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