Only modest dividend growth at Collins Property as they reinvest in the group (JSE: CPP)
The loan-to-value ratio is well above the levels that REITs usually run at
Collins Property Group has released results for the six months to August. Despite a juicy increase in distributable income per share from 54 cents to 63 cents, the dividend has only increased from 50 cents to 52 cents. Interesting.
The debt ratios give us a clue as to why the group might be taking a more conservative approach with dividends. The loan-to-value is high at 51.8%, with most REITs preferring to run in the low 40s. The group has been investing in the Netherlands, so they’ve run the balance sheet hot to make that transaction happen. There are properties worth R960 million that have been sold and are awaiting transfer, so perhaps that will give the balance sheet some breathing room going forwards. I’m not convinced they will reduce debt though, as the outlook statement speaks directly to deal flow and reinvestment opportunities.
As a quick look at the South African portfolio, the vacancy rate in both the industrial and retail portfolios is running at roughly 0.8%. The office portfolio is still really struggling, with a vacancy rate of 17.3%. The office portfolio is 7% of the group’s property exposure and they are looking to sell those properties.
Group production dipped at Impala Platinum, but sales are higher (JSE: IMP)
An increase in refined production helped here
Mining is a complicated thing. Even when the prevailing market prices for a commodity are favourable, the mining houses still need to get the stuff out of the ground and sell it. This is why production reports are very important.
For the three months to September, Impala Platinum experienced a 5% decline in group 6E production volumes. Despite this, refined and saleable production volumes increased by 3%, helping to drive a 7% increase in sales volumes. Based on this performance, FY26 guidance has been maintained.
There were various reasons for this, ranging from lower grades and recoveries through to the timing of maintenance. The key is that sales at least moved in the right direction, even if production had some challenges.
MC Mining is making progress at Makhado (JSE: MCZ)
Uitkomst remains a difficult story
MC Mining released an activities report for the quarter ended September. It’s positive overall, with the company making solid progress at the Makhado Project and achieving some key milestones. There have been some delays (as usual in large construction projects), but commissioning activities for the coal plant are expected to begin by December 2025.
At Uitkomst Colliery, the turnaround plan was approved and key initiatives are being executed. Run-of-mine production fell 8% year-on-year and 21% quarter-on-quarter, so they have a lot of work to do there. High-grade coal sales were down 1% year-on-year. Coal prices are still under pressure vs. the levels seen earlier this year, although revenue per tonne actually increased year-on-year.
Thankfully, the investment by Kinetic Development Group is supporting the balance sheet through this tricky period, with a cash balance of $13.2 million at the end of the period.
Although there was a 15.8% climb in the share price on the day, it happened before the announcement came out at 10am.
Incredible momentum at MTN Nigeria (JSE: MTN)
A far more stable macroeconomic base is doing wonders
MTN Nigeria is a perfect example of an extreme version of the risk/reward trade-off. It’s a huge market, which means the size of the prize is exciting. It unfortunately also comes with a heavy dose of macroeconomic volatility. After all, it was just last year that things almost looked hopeless for MTN Nigeria.
These issues are in the rearview mirror now, although one should never discount them from returning. The Nigerian naira has actually appreciated against the US dollar in 2025 (thanks, Trump and tariffs). The Central Bank of Nigeria has managed to decrease interest rates by 50 basis points (although the Monetary Policy Rate remains very high at 27%). There’s clearly a recovery underway.
This is doing wonderful things for MTN Nigeria’s business. Total revenue is up 57.4% for the nine months year-to-date and 62.8% for the quarter ended September, so there’s been an acceleration in the business. EBITDA is up by a delicious 123% year-to-date, with margin shooting up from 36.3% to 51.4%. In the third quarter, EBITDA was up 129.2% and the margin was 52.9%, so the acceleration is again evident.
Here’s the real kicker though: MTN Nigeria generated 45% of the year-to-date profit in the third quarter! The momentum throughout the year has been immense, with the business having swung sharply from losses to profits.
As the icing on the cake, free cash flow is up 38.5% year-to-date and 75.7% in the third quarter. The day truly was darkest before the dawn for them. The big question is: can it continue?
Nu-World paints a surprisingly positive picture of the South African consumer (JSE: NWL)
This small cap is always a useful look at local discretionary spending
It’s very unlikely that Nu-World is on your investment radar. With a market cap of R650 million and an average of R100k – R120k in stock changing hands each day, this isn’t exactly an institutional investor favourite, or a regular feature on stock picking lists. But there is one thing that Nu-World is particularly useful for: a clean look at consumer health in South Africa.
This is because Nu-World specialises in consumer discretionary goods, like appliances. They do have offshore markets, so an effort to isolate the South African performance requires a dig into the segmental numbers.
Let’s deal with the group performance first. For the year ended August, Nu-World’s revenue was up 11.1% and HEPS increased 11.0%. The dividend per share was up 9.4%. That’s a solid set of numbers.
In South Africa, revenue was up by 13.8% and income jumped by 60%, so they definitely didn’t need to cut their margins to achieve that sales uplift. TV and audio sales improved and seasonal categories did particularly well. Overall, despite the prevailing high interest rates, South African consumers increased their purchases of these discretionary items.
It’s not every day you’ll see a gross loss, but such is life at Renergen (JSE: REN)
The ASP Isotopes (JSE: ISO) offer truly saved the day
There are many companies that make a net loss from time to time – that’s a loss after covering all operating expenses, finance costs and the like. But it’s very rare to see a gross loss, which is the opposite of a gross profit – in other words, a situation where the company is losing money every time it sells something!
Renergen is no longer capitalising the costs related to the recent plant construction, as the plant has been commissioned. This means that the costs are landing on the income statement as an expense, rather than being sent to the balance sheet as an asset. What would usually happen is that the revenue flowing from the commissioning of the plant would offset the costs. Alas, Renergen managed to suffer a drop of 4% in LNG production and they produced negligible helium, so the revenue just wasn’t there.
After swinging from a gross profit of R0.9 million to a gross loss of R28.7 million, you can imagine what the rest of the income statement looks like. Other operating expenses jumped by R31.5 million, with only an incremental R3.2 million being due to professional fees related to the ASP Isotopes offer and Renergen’s legal battles. When you reach the funding costs line, you’ll find a leap of R50.2 million thanks to the funding costs on the loan from ASP Isotopes that arguably kept Renergen alive, as well as the Standard Bank facility.
Renergen currently has cash of R163.1 million and owes ASP Isotopes R538.5 million. I truly have no idea how Renergen shareholders would’ve survived without the offer coming in from ASP Isotopes.
Vodacom’s earnings are growing strongly (JSE: VOD)
This is the case even after adjusting for once-offs in the base
Vodacom released a trading statement for the six months to September 2025. HEPS growth of 40% to 45% looks ridiculous at first blush, but there are some adjustments to consider.
The corresponding period had once-off impacts related to the DRC and Ethiopia of 55 cents per share, so the adjusted base for HEPS would be 408 cents. Even then, the guided range of 494 cents to 512 cents is an uplift of roughly 23% at the midpoint!
Vodacom has noted that there are some other significant movements below the EBITDA line that are leading to this jump. EBITDA growth is expected to be in line with the 2030 growth plan, which means double-digit growth. It’s very likely that Egypt is a major contributor here.
Either way, it’s an impressive set of numbers. I look forward to the release of full details.
Nibbles:
- Director dealings:
- A director of a major subsidiary of OUTsurance (JSE: OUT) – specifically their Australian business – sold shares in OUTsurance worth R24.2 million.
- Norbert Sasse, the CEO of Growthpoint (JSE: GRT), sold shares in the company worth R11.5 million.
- A non-executive director of Valterra Platinum (JSE: VAL) sold shares worth R9.8 million.
- A non-executive director of Old Mutual (JSE: OMU) bought shares worth almost R3 million. I’m really not sure why, but he also sold shares worth around R240k!
- An associated entity and the spouse of a non-executive director of Northam Platinum (JSE: NPH) bought shares worth R2.2 million.
- A director of Santova (JSE: SNV) sold shares worth R560k.
- For whatever reason, a few directors and senior execs at Attacq (JSE: ATT) donated shares to associates and spouses.
- Aspen (JSE: APN) announced that the material contractual dispute related to the mRNA customer (i.e. the one that broke the share price this year) has been settled in Aspen’s favour for around R500 million. The company’s market cap has shed roughly R30 billion in value this year, so that’s a very small consolation prize in the broader context.
- Stefanutti Stocks (JSE: SSK) has made important progress with the balance sheet. The primary operating subsidiary has concluded a new R850 million 5-year facility agreement with Standard Bank. The facility has been priced at three-month JIBAR plus a margin of 3.5%. The key here is that the facility will be used to settle the current loan obligations with lenders that was extended to June 2026. Stefanutti Stocks intends to settle the capital on this loan using the contractual claim re: Kusile and the proceeds from the sale of SS-
Construções (Moçambique) Limitada.
- Unsurprisingly, Curro (JSE: COH) received almost unanimous approval for the scheme of arrangement related to the Jannie Mouton Stigting transaction. I genuinely cannot understand why anyone would vote against it. Perhaps the 0.02% of votes against the scheme were just finger trouble?
- Kore Potash (JSE: KP2) released its quarterly update for the three months to September. After term sheets were signed for the financing of the project in early June, the focus in the past few months has been on putting the right people in place for the project. This includes project management services, with a bid from United Mining Services winning the request for proposal process. Contracts are expected to be executed by the end of 2025. Other workstreams include the Environmental and Social Impact Assessment, as well as the analysis of samples from the cores that were shipped to China. The company had $2.13 million in cash as at the end of September.
- Spear REIT (JSE: SEA) has completed the acquisition of Maynard Mall for R455 million. The loan-to-value ratio is between 18% and 19% after this acquisition.
- KAP (JSE: KAP) has announced its new CFO to replace Frans Olivier who has stepped into the top job as CEO. Dries Ferreira is coming in as the new CFO, which means he is leaving his CFO role at Astral Foods (JSE: ARL). KAP quite honestly needs all the help it can get, so someone with poultry sector experience (one of the toughest sectors around) feels like a solid choice to me. Astral hasn’t announced a successor as they were obviously caught off-guard by the resignation.
- While on the topic of new CFOs, DRDGOLD (JSE: DRD) confirmed that CFO Designate Henriette Hooijer (whose appointment was announced in June) will replace Riaan Davel with effect from 1 February 2026.
- Cilo Cybin (JSE: CCC) announced that the trades caused by errors in a broker’s system have been rectified, including the trades related to the CEO and a non-executive director.
- Europa Metals (JSE: EUZ) has been suspended from trading on the AIM since May 2025. The last major announcement from the company was that it is working towards returning assets to shareholders in the most tax efficient way. With an asset base that consists mainly of cash and shares in Denarius Metals Corp, the group has net assets of AUD3.24 million (around R36.7 million). Not that there’s much trade in the shares on the JSE, but the most recent share price suggests a current market cap of just below R30 million (and thus not far off the NAV per share).
