Anglo American’s copper push continues (JSE: AGL)
They certainly aren’t sitting still
Anglo American recently announced a blockbuster deal in the form of the proposed merger with Teck Resources to form Anglo Teck. They are trying very hard to convince everyone that this is a merger of equals, even though the numbers tell a different story. Anyway, copper sits at the heart of that strategy, with the latest news from Anglo American reflecting further progress in the underlying copper business.
Anglo American and Codelco have agreed to a joint mine plan for the adjacent copper operations (Los Bronces and Andina respectively) in Chile. This is expected to achieve additional copper production of 120,000 tonnes per year (shared equally), with 15% lower unit costs vs. standalone operations.
They believe that this unlocks a pre-tax net present value of at least $5 billion, shared equally between the firms. It’s important to note that Anglo’s stake in Los Bronces is in a 50.1%-held subsidiary, so Anglo shareholders are basically getting half of half of $5 billion in value uplift – in theory. These gains are all on paper at the moment.
If they get it right, the incremental production gain would take the combined production numbers into the top 5 copper mines globally. Currently, if you just add the mines together without the incremental gain, there’s a top 10 production base to work from.
It’s important to not fall into the trap of actually seeing this as a combined asset, as each company retains its separate ownership and can advance the underground resources as they see fit. This is really just a joint mine plan that hopefully goes well.
Attacq’s recent corporate activity has paid off in the form of much higher earnings (JSE: ATT)
You won’t often see these kind of growth numbers in a property fund
Attacq has released results for the year ended June 2025. Distributable income per share was up 25.6%. It’s possible in a period of heavy dealmaking to see an increase in overall distributable income of that amount (as funds can simply go out there and acquire earnings), but it’s very rare to see it on a per-share basis.
Powering this performance is growth in net operating income of 14.0% (a particularly impressive two-year stack as the prior year was 8.1%), along with the benefit of development activity at Waterfall City and the first full-year impact of deals at Waterfall City with the GEPF and the acquisition of the remaining 20% of Mall of Africa.
It’s easy at times to forget that Attacq has a substantial portfolio outside of Waterfall City. They are focused on dominating the precincts they are invested in, so you won’t find them owning random buildings in an incoherent strategy. Instead, they build out centres of excellence in various places, with Waterfall City as the precinct that they are best known for.
Looking deeper into the portfolio, we find a like-for-like valuation increase of 5%. The retail portfolio was the most impressive at 6.8%. It’s great to see the office portfolio (Attacq calls this the “collaboration hubs”) up 2.3% in value thanks to 6.1% net operating income growth. Its been a long, hard road for office property, as evidenced by this chart:
The fund is in great shape, which enables them to continue with the development strategy (including speculative logistics developments with lumpy effects on occupancy, as is also visible in the chart above).
Guidance for FY26 is for growth in distributable income per share of 7% to 10%, with an 80% dividend payout ratio. The FY25 payout ratio was 80.3%, so the distributable per share growth should be very close to distributable income per share growth.
Ethos Capital flags a significant uptick in NAV (JSE: EPE)
Optasia and the Brait exchangeable bonds have boosted the value
Ethos Capital has released a trading statement for the year ended June 2025. They do things the right way in terms of how they report performance, which means they use net asset value (NAV) per share instead of HEPS like some investment holding companies do. Full results are coming on 25 September, so they’ve also given shareholders more than a week of advance warning of what’s coming. That’s not amazing, but not too bad.
The good news for shareholders is that the net asset value per share is expected to be between R8.45 and R8.60, which means an increase of between 20% and 22% without adjusting for the Brait ordinary shares that were unbundled in July 2024. With that adjustment, the increase is between 28% and 31%.
The main driver of the increase is the value of Optasia (around 50% of group assets as at March 2025), along with positive valuation moves at Vertice, e4 and Primedia in the unlisted portfolio. In the listed space, the Brait exchangeable bonds also increased in value.
Hyprop’s dividend per share growth was just below the double-digit level (JSE: HYP)
And guidance for the coming year is higher
I’m still frustrated with how the Hyprop capital raise for the attempted acquisition of MAS (JSE: MSP) was handled. It probably says more about the cost of debt in South Africa than anything else, with institutional investors happy to throw money at property funds on the off-chance that they do a good deal, with reduction of debt as a palatable plan B. The cost of debt being so close to the cost of equity explains a lot about how hard it is to grow a business in South Africa.
For the year ended June 2025, Hyprop achieved very strong growth of 24% in distributable income in the Eastern European portfolio, along with 11% growth in South Africa. Distributable income was up 7.5%, but distributable income per share was up 2.3%. The per-share number is where you see the effect of the additional shares in issue.
Hyprop had enough flex in its payout ratio to make sure that the dividend per share tells a better story, up 9.9%. We will have to see what they do with the payout ratio in FY26, with guidance for distributable income per share growth of between 10% and 12%. This is on the assumption of interest costs remaining at current levels, so any decrease in global rates should help.
In the South African portfolio, Hyprop tenants enjoyed a 5.5% increase in turnover despite the economic pressure and growth trend in eCommerce (foot count was up just 0.1%). The reversion rate was positive at 4.3%.
In Eastern Europe, turnover growth was even better at 6.6% (in euros) despite a decline in foot count of 0.8%. Reversions were positive 9.1%.
Touching on debt reduction again for a moment, the group loan-to-value (LTV) ratio improved from 36.4% to 33.6%. The average cost of borrowings also reduced. This combination always does wonders for distributable income.
Table Bay Mall, which in my opinion Hyprop overpaid for, has a vacancy rate of 2.1%. That’s higher than Canal Walk (1.4% retail vacancy), Somerset Mall (0.6% vacancy) and CapeGate (0.9% vacancy) as Western Cape peers. The foot count at Table Bay Mall was just 5.6 million over 12 months, which is way off CapeGate at 10 million despite Table Bay Mall having only slightly less GLA. I know the area well and I don’t doubt the long-term growth, but it feels like they paid for all of it upfront.
Libstar might be headed for the exit (JSE: LBR)
And at a time when earnings are finally moving higher
Libstar has had a pretty rough journey as a listed company. That journey might be coming to an end, with the results announcement accompanied by a cautionary regarding non-binding expressions of interest received from parties who are looking at acquiring all the shares in Libstar. If that happens, it would obviously mean a delisting of Libstar. The discussions are at an early stage and there’s no guarantee of an offer coming through (or at what price), but that didn’t stop the market from taking the share price 14.5% higher.
Moving on to the results themselves, Libstar’s performance for the six months to June 2025 reflects a very helpful increase in revenue from continuing operations of 6.7%. This was accompanied by a 90 basis points increase in gross margin to 21.6%. Normalised operating profit came in 16.7% higher and normalised HEPS grew by 15.4%, so things are firmly on the up. This would’ve also supported the share price move.
As for all the normalisation adjustments, this includes what Libstar describes as “non-recurring, non-trading and non-cash items” – and hence a healthy dose of skepticism is a good idea. The great news is that normalised HEPS growth of 15.4% is actually much lower than HEPS growth (without adjustments) of 23.7%, so the normalisation adjustments are telling a more modest story. That’s a much better situation than the other way around.
Libstar only declares final dividends rather than interim dividends, so there’s no dividend at this time.
The outlook is one of a weak consumer market and a need for Libstar to focus on operational efficiencies in its business. They’ve been doing a pretty good job of that lately!
After the latest share price move, here’s what the chart looks like:
Premier Group achieved excellent earnings growth (JSE: PMR)
This is the kind of trading statement that the market loves seeing
Premier Group has released a trading statement for the six months ending 30 September 2025 – yes, they’ve done it before the end of the period! Great as that is, I don’t think the dates of the RMB Morgan Stanley Off Piste conference (17th and 18th September) are a coincidence. This trading statement at least gives management the ability to talk to conference attendees about just how well the business has done, without giving away non-public material price sensitive information.
Premier is achieving mid-single digit revenue growth and is on track to turn that into an increase in HEPS of between 20% and 30%. As leverage goes, that’s exceptional. It also explains why the share price closed 4.4% higher to take the 12-month increase to 57%.
RFG Holdings is battling tough sales conditions (JSE: RFG)
The market seemed to like the update anyway, presumably because of margins
RFG Holdings released a trading update for the 11 months to August. This is essentially a pre-close update by another name. The share price closed 7% higher in response, despite some clear challenges being faced by the business.
Revenue was up just 2.4% for the 11 months, which is even slower than the 3.5% growth in the interim period. A deceleration in revenue off a low base is concerning. Management has stated that they “remain committed” to achieving the operating profit margin target of 10%, although the announcement isn’t explicit on by when. The interim profit margin was 8.5%.
The deceleration in revenue is actually worse than it looks, with RFG noting that July and August showed particularly weak trading in South Africa. The regional segment (local sales) has been the only thing keeping RFG in the green, as the international segment has been experiencing a drop in revenue due to an oversupply of deciduous fruit products and now the uncertainty on tariffs as well.
For the 11 months, revenue in the regional segment was up 5.1% and the international segment was down 8.4%. This compares to interim growth of 7.6% and -17.2% respectively, so the international business actually clawed back lost ground in recent months while the regional segment slowed down even more.
It’s a tough business with exposure to numerous external factors, with the share price down 23% year-to-date and up 4.3% over 12 months.
Nibbles:
- Director dealings:
- A senior executive at Quilter (JSE: QLT) has sold shares worth around R5.7 million.
- Des de Beer bought shares in Lighthouse Properties (JSE: LTE) worth R109k.
- An independent non-executive director at STADIO (JSE: SDO) bought shares worth R40.6k.
- Nampak (JSE: NPK) needs to find a new buyer for Nampak Zimbabwe. The disposal of its 51.43% stake in Nampak Zimbabwe for up to $25 million to TSL Limited has fallen through despite a successful due diligence and competition authority approval process. TSL has elected to withdraw from the deal for strategic reasons and Nampak has agreed to this. Nampak remains committed to an exit from this asset.
- Visual International Holdings (JSE: VIS) announced that Serowe Industries has submitted a non-binding offer to acquire up to 34.9% of the issued shares in the company via a subscription for equity of R60 million. The 34.9% shareholding is just enough not to trigger a mandatory offer to all shareholders (35% is the threshold for that). Serowe has an exclusivity period of 40 business days for the due diligence. In that period, Visual can’t negotiate with anyone else regarding equity, other than for a R2 million bookbuild that will be executed during that period (and in which Serowe will be invited to participate). Visual’s current market cap is R44 million. The pre-money valuation implied in this process is R112 million, which you calculate as R60 million / 34.9% = R172 million post-money valuation. Take off the R60 million in new equity and you get to R112 million pre-money, or 2.5x the current market cap! It’s little wonder that the share price doubled on the day on exceptionally strong volumes (by Visual’s standards, as this is a highly illiquid stock).
- MAS (JSE: MSP) – the company that dominated headlines for a few weeks as you may recall – has announced that four new independent non-executive directors have been appointed, along with a non-executive director (not of the independent variety) in the form of Martin Slabbert of Prime Kapital. Dewald Joubert, Nevenka Pergar, George Mucibabici and Yovav Carmi are the four independents who will join the board. Notably, the current independent chairman (Werner Alberts), lead independent non-executive director (Claudia Pendred) and chair of the audit and risk committee (Vasile Iuga) have all tendered their resignations with immediate effect. The replacement chairman hasn’t been announced yet and neither have the reconstituted committees. You won’t often see wholesale changes to a board like this, but then again you don’t usually see corporate activity like we saw at MAS.
- If you wondered whether Truworths (JSE: TRU) CEO Michael Mark is finally headed for retirement, then the latest announcement of share awards at the company should put those worries / hopes (depending on your view) to rest. The performance shares are worth R16.5 million and the vesting profile is such that they all vest in year 3 (subject to performance conditions).
- Southern Palladium (JSE: SDL) is presenting at the Resources Rising Stars Gold Coast Investor Conference this week. They’ve made the presentation available, with slides ranging from an overview of the PGM supply-demand expectations through to the optimised prefeasibility study at Bengwenyama. You’ll find the presentation here.
Note: Ghost Bites is my journal of each day’s news on SENS. It reflects my own opinions and analysis and should only be one part of your research process. Nothing you read here is financial advice. E&OE. Disclaimer.
