Accelerate Property Fund has finally released the Portside disposal circular (JSE: APF)
Turning the Portside stake into cold, hard cash is crucial for the fund
If you’re familiar with the Cape Town CBD skyline, then you already know the Portside building. It’s the gigantic glass building in town that towers above everything else. When Accelerate originally bought it from Old Mutual Life Insurance Company in 2016, they paid R755 million for it. That was then and this is now, with the latest valuation being R610 million and Accelerate achieving a selling price of R580 million.
Before you get out the torches and pitchforks, I must tell you that many property deals done around 2014 – 2016 in South Africa were concluded at ridiculously high prices. Property certainly isn’t immune to bubble risks, with the level of equity capital raising activity among listed property funds as a great indication of whether things are overcooked or not. During those years, the pot was boiling over with capital being thrown at every property company in the market.
The relevance of this deal isn’t the return (or lack thereof) over the past decade, but rather the critical importance of this disposal to the recovery of Accelerate. With a bruised and broken balance sheet (and share price), Accelerate simply cannot afford any further missteps. They are dealing with very tough related party risks, as well as the difficulty in transforming Fourways Mall from a white elephant into a cash cow. There are also other assets that need to be disposed of, including several that aren’t nearly as impressive as the Portside silhouette.
This disposal reduces Accelerate’s total debt from R3.85 billion to R3.27 billion. The total asset value after the disposal will be just over R7 billion. The net asset value (NAV) of the company is barely impacted vs. the March 2025 level, as they’ve sold the property at the carrying value as at that date. In other words, one type of asset is being turned into another. That’s not the point though – you see, when a share is trading at a vast discount to NAV, it creates a lot of value for investors (punters?) if that NAV evolves from illiquid fixed assets to liquid cash.
The net asset value per share as at March 2025 was R2.03. The dilutive rights offer took that down to R1.83. The pro forma number after this deal is R1.82. And the share price? Just R0.39 per share, reflecting a discount to NAV of 79%!
This is why existing shareholders should feel very good about every single example of Accelerate turning an asset into cash at or near the carrying value.
Accelerate shareholders will vote on this deal on 6th November. The other remaining condition for the disposal is a Competition Commission approval without any onerous conditions attached to it. I can’t see why that would be a problem in a property deal like this.
Is Afrimat primed for a big positive swing? (JSE: AFT)
The latest update shows a remarkable turnaround in the business
Afrimat has released a trading statement for the six months to August. With the share price having lost well over 40% of its value year-to-date, they desperately needed to show some positive momentum in the group.
The good news is that they’ve done exactly that, with an expectation for HEPS of between 100.7 cents and 103.4 cents. That’s an increase of between 90% and 95% vs. the comparable period! When you see moves like these, it’s very useful to go back a bit further and example the multi-year performance. In the six months to August 2023, HEPS was 263.4 cents. In fact, if you go back to the results presentation for the six months to August 2024, you’ll find this excellent chart:
The key point here is that HEPS was incredibly depressed in 2024, so the year-on-year move of between 90% and 95% doesn’t mean much. The guided range is still way off the pandemic levels and even the pre-pandemic levels.
It therefore makes sense that the share price is also still miles off those levels:
Of course, the real question is whether this will be enough to stop the slide and perhaps drive a rally back up to the R50 level. Afrimat closed 10.7% higher in response to this announcement, so that’s a sharp improvement in momentum.
The fundamental drivers of the improved performance in this period look good overall, although there’s still a long way to go.
In Construction Materials for example, there was a slow start to the first quarter and then a much better second quarter. The fly ash business had its best ever month in July in terms of volumes. But the cement business remains loss-making overall for the first half, showing just how difficult it is to make that business work.
The Bulk Commodities business enjoyed a massive increase in iron ore sales, with local volumes more than doubling vs. the comparable period. International volumes posted a more modest increase of 13.5%. Don’t get too excited though, as planned maintenance shutdowns of the Saldanha export line during the second half should lead to a situation where full year volumes are flat vs. the prior year. Another concern is the anthracite mining operation, which is suffering with decreased demand from ferrochrome smelters that have been forced to temporarily shut down in South Africa due to harsh economic realities in that sector. Afrimat is exporting anthracite via Mozambique to try and mitigate this lack of demand.
The Industrial Minerals business is a small part of the group, but had a weak half due to delayed demand from the agricultural sector based on the timing of rainfall.
The Future Materials and Minerals business is an early-stage business, with the economics expected to be three years away. Thankfully, no additional capital investment is expected to get them there. The Glenover project is selling phosphate material and is decreasing its operating losses.
Detailed interim results are expected to be released on 23 October.
Datatec has taken some inspiration from how global tech companies report numbers (JSE: DTC)
The goodnews is that they are firmly in the green either way
Datatec has released a trading statement for the six months ended 31 August 2025. The underlying story is great, with Westcon achieving stronger margins and both Logicalis International and Logicalis Latin America achieving much better numbers than before.
This has driven a juicy increase in HEPS of more than 100%, with expected earnings of between 21 and 23 US cents for the period.
Datatec has decided to present underlying earnings excluding share-based payments (and with various other adjustments). This will sound familiar to anyone who regularly reads the reports of global technology companies. I’m not a fan of this approach, as US companies use it as a great excuse to ramp up share-based payments and then conveniently adjust earnings accordingly. I’m hoping that Datatec won’t behave in that way and that they are rather doing this to improve comparability of their earnings to global peers.
On this adjusted basis, underlying earnings will be between 18 and 20 US cents, or between 33.3% and 48.1% higher than the prior year. This seems to be a decent indication of the year-on-year growth that the company achieved.
Either way, it’s excellent.
Finbond is back in the green (JSE: FGL)
The share price has been strong this year
Finbond is one of those companies that always seems to be bubbling under the surface. They have some interesting elements to their business model, yet it rarely seems to all come together for them in a way that rewards investors. But in the latest period, they’ve at least swung back into profitability.
A trading statement for the six months to August 2025 suggests HEPS of between 0.88 cents and 1.28 cents, which is much better than a loss of 2 cents in the comparable period. But it’s also nowhere near high enough to justify the current price of R1.05 per share, so the market is clearly pricing in much more upside in earnings. The share price is up more than 65% year-to-date.
Newpark REIT has released updated earnings guidance (JSE: NRL)
The large negative reversion at the JSE has hurt the year-on-year performance
Newpark is a particularly unusual property fund on the JSE. They have a very focused portfolio with literally only a handful of buildings. This means that any negative changes to the leases have a significant impact on the numbers.
Exhibit A: the large negative reversion in the lease for the JSE building. Much as I’m sure the JSE really wants to be where they are, the truth will always be that it’s easier to move a business than a building. In a market with oversupply, like in Sandton offices, this creates a recipe for negative reversions i.e. the renewed lease being at a lower rate than the old lease.
This is why Newpark guided for a nasty year-on-year decrease in earnings this year of between 38.1% and 47.1%. This is actually updated guidance that is slightly better than before, with Newpark trying to mitigate the negative impact through strategies like decreasing the operating costs at the properties. They also have escalations at the other properties to offset some of the impact of the JSE building.
For the six months to August, they expect funds from operations per share to decrease by 24.5%. The dividend for the period is expected to be 13.3% lower. It looks like they are front-loading the interim dividend when you compare it to the guidance for the full year.
SA Corporate Real Estate to sell Bluff Towers (JSE: SAC)
The fund is reducing its retail exposure to KZN
SA Corporate Real Estate announced the disposal of Bluff Towers Shopping Centre for R544.6 million. The price is very similar to the June 2025 independent valuation of R545.1 million. With net property income of R44.7 million for the year ended December 2024, that’s a trailing yield of 8.2%. The recent income would hopefully be higher due to the benefit of inflation, but it gives you an idea of the yields at which large retail properties are changing hands.
SA Corporate Real Estate has disclosed that the net asset value attributable to the property was R358 million as at the end of December 2024. I assume that this is net of debt, as that’s way below both the recent valuation and the selling price.
This deal is effectively a disposal of an asset that has been redeveloped to maturity, something that is reflected in the attractive price that SA Corporate Real Estate has achieved here. The fund will probably look to reallocate the capital to opportunities with higher potential returns. This is a Category 2 transaction, so shareholders won’t be asked to vote on the deal.
Nibbles:
Director dealings:
The CEO of Fortress Real Estate (JSE: FFB) increased the number of shares pledged for a loan facility, as the facility limit has increased from R26 million to R34 million. This is nothing unusual in the property sector, with many executives entering into leveraged trades to acquire shares in the funds that they run.
MAS (JSE: MSP) recently announced a tender offer to reduce its debt in the market. That’s a big deal if you’ve followed the fund over the past few years, as full focus has been on trying to prepare the balance sheet for debt redemptions. The tender offer was made to holders of €300 million in notes due 2026. Almost €120 million was tendered under the offer, with holders of the remaining notes clearly keen to keep them until expiration.
Barloworld (JSE: BAW) announced that the standby offer closing date has been extended from 15 October to 7 November. They are obviously trying to get as many acceptances as possible.
Salungano Group (JSE: SLG) is catching up on its financial reporting. They’ve now released financials for the year ended March 2024, with the auditors flagging a material uncertainty about the group as a going concern. The headline loss per share increased from 58.65 cents to 111.91 cents. It’s a mess.
Southern Palladium (JSE: SDL) has lodged the environment guarantee in relation to the Bengwenyama PGM project, which is an important milestone related to the mining right application with the Department of Mineral and Petroleum Resources. The mine development plan for the Definitive Feasibility Study is on schedule. In junior mining, it’s all about ticking the milestones off the list.
The Saltzman family continues to reduce their influence on the group that they founded, with Saul Saltzman (son of the founders) resigning as an executive director of Dis-Chem (JSE: DCP). He will stay on the board as a non-independent, non-executive director. Dis-Chem has been an incredible example of founders creating a legacy business and then trusting professional managers with it.
The digital generation has access to more information and tools than ever before. But the more things change, the more they stay the same: one of the most powerful tools of all remains the benefit of starting young and entrenching the right money habits from as early as possible in your life.
And yes, this includes investing on behalf of your children!
In this episode of Ghost Stories, Lauren Jacobs (Senior Portfolio Manager at Satrix) joined me for a candid discussion about her approach to entrenching the right financial behaviours from early in her career and the journey of investing for her family.
We also talked about the value of learning by doing, which means testing out the market and banking the hard lessons sooner rather than later!
The concept of “time in the market” is one of the most powerful wealth creation strategies of them all. If you are looking for the inspiration to just start, or a refresher on why those tough-to-form habits are so worthwhile, then you’ll love this discussion.
Disclaimer: Satrix Investments (Pty) Ltd & Satrix Managers (RF) (Pty) Ltd is an authorised financial services provider. The information does not constitute advice as contemplated in FAIS. Use or rely on this information at your own risk. While every effort has been made to ensure the reasonableness and accuracy of the information contained in this document (“the information”), the FSP’s, its shareholders, subsidiaries, clients, agents, officers and employees do not make any representations or warranties regarding the accuracy or suitability of the information and shall not be held responsible and disclaims all liability for any loss, liability and damage whatsoever suffered as a result of or which may be attributable, directly or indirectly, to any use of or reliance upon the information. Consult your financial advisor before making an investment decision. Tax Free Savings Accounts: Annual limit of R36000, lifetime limit of R500 000, 40% tax penalty applicable for contributions above the limit, per individual.
Full Transcript:
The Finance Ghost: Welcome to this episode
The Finance Ghost: Welcome to this episode of the Ghost Stories podcast featuring the team from Satrix and this time around I get to speak with Lauren Jacobs again. She is a Senior Portfolio Manager at Satrix.
Lauren and I had a fantastic discussion earlier this year where we really got to understand so much about the nuts and bolts of Exchange Traded Funds or ETFs. I think the TL;DR of that conversation was that it might be a nice passive buy-and-hold investment for investors, but there’s nothing passive about what happens in the back-end for Lauren and her team – there is a lot to do all the time.
Fresh from another index balancing, Lauren, thank you for making time for doing this podcast. I know it’s been a busy time for you.
Lauren Jacobs: It’s good to be back again, Ghost. Thanks for having me. Yeah, we did have quite a hectic week last week, but we’re back in action on all the other things. So yeah, happy to be here.
The Finance Ghost: Yeah, fantastic. Another one under your belt there. Today we’re going to be talking about a couple of things, but the overarching principle of this podcast is around the importance of digital tools, not just for younger investors, but also for any investor, really. It’s just obviously younger generations of investors tend to be a little bit more familiar with some of the digital tools that are out there.
We’ll also just be talking about the importance of an early start and some of that as well.
And I think, Lauren, what’s going to make it extra fun is we’ll kind of be asking each other a few questions because I think you’re probably going to ask me a few about some of the tools that I use as well. So I’m looking forward to a nice dynamic conversation.
I think let’s jump straight into it and start with really the key principle here, which is that old story of: is it ever too early to start or is it always good to just start as early as possible in the market and why?
Lauren Jacobs: Yeah, Ghost, I think it’s really important to just start and whenever that is, whether it’s as a parent for your kids or as a young person, if you have a job but you earn some money and want to put some money away, it really is important to start early. And the really powerful concept here that we want to keep in mind is compound interest. Because when you invest, your money earns returns and then those returns earn returns and those returns earn returns, and it just snowballs. And obviously the longer you have to earn those returns, the larger your investment could be over time. It’s not just about the numbers – it’s also the fact that when you are young, you can take more risks, you have more time to recover from market dips and also you learn from an early point in your life, whether that’s age or just in terms of point in your life, you really learn to build financial discipline, which is important for anybody to learn.
The Finance Ghost: Yeah, absolutely. I mean, the benefit of doing this younger is that a market crash – maybe that sounds a bit harsh – but a market dip, whatever the case may be, almost becomes an opportunity rather than something else. You only have to look historically, long-term returns on the big market indices, the big equity indices specifically, it recovers every time, it takes time – not at individual stock level – but at market level.
And that’s the benefit of ETFs, right?
Lauren Jacobs: So when you’re young, you have this major advantage of time. And time allows you to take on more financial risk because you have these years, even decades, to recover from those market downturns. And markets go up and down, like you said, I mean, it’s normal. One day it’s up, one day it’s down. Maybe it’s down for a significant number of months.
But if you start investing early, you can ride out those dips. You don’t need to panic when the market drops 10%, 20% because you’re not planning to take your cash out next year. You’re investing for the long-term.
In that regard, what does risk really mean? It’s not gambling or chasing the hype or whatever that you think, oh, risks, it’s dangerous. But it really means that it gives you the opportunity first of all to have a higher equity exposure in your portfolio because you’ve got this long-term view. You can invest more in growth focused, maybe ETFs or things like emerging markets or thematic funds, because you just have time to feel out the market and to really ride out all those dips and also to ride out all the gains. So just thinking around, “I can take more risk,” which as you and I know because we’ve been in the game for a long time, also talks to higher return.
Time in the market is what is the most important thing when it comes to investing and investing from an early age.
The Finance Ghost: And I think there’s risk in not taking risk. That’s something that people don’t always realise, is if you’re sitting in an economy with high inflation and you think you’re playing a smart game and you’re just keeping your money locked up in the bank and you’re earning a couple of percent, the reality is that actually you’re hurting yourself, specifically if you’re young. I always personally get frustrated when I see stuff like someone who’s young doing their tax-free savings allocation into a bank interest-paying account. Number one, a big portion of your interest every year is already not taxed, let’s just start there. You’ve got to have quite a lot invested before it gets taxed. Number two, the tax-free savings account benefit is that your gains are not taxed – so my approach is to go and invest in stuff that has the maximum possible gain so that I get the maximum possible tax benefit from my tax-free savings account.
So it all dovetails, right? This stuff all works together at the end of the day.
Lauren Jacobs: It does. I think, exactly what you said – what’s the point in putting it in money market if in the money market you’re already getting your interest tax-free, basically. I talk a lot to young adults, university students and so on, and we talk about taking the risk. If you get a SatrixNOW voucher, for example, you know it’s a R100 voucher, go buy 10 different ETFs, because you can invest R10 in each of those ETFs.
Just see what the market is like, see what risk really means and see how when things go up, they can also go down. When things go down, they then go up. And it’s just really learning and interacting with the market. So that also builds your financial education over time.
And risks are there not only to improve your return over time, but you also need to manage your risks. In the future, maybe when you’re older, then you can understand, okay, I took all this risk when I was young, but now I’m in a period of curtailing that risk, planning for marriage, weddings, children, whatever it is, but you learn over time how these things move. And it’s a great exercise in just educating yourself. Because if you start early, you are also taking the time to educate yourself around what do markets do? What is investment? What is the difference between investing and just saving in a bank account?
Just taking that “just start” stance and investing the money and keeping it in the market, so spending that time in the market, all of those things talk to – whether you start early or start a bit later – as long as you just start. That’s the important part.
The Finance Ghost: I think you’ve raised such an important point there around the value of learning as young as you can. Because then you can make mistakes with relatively small amounts of money versus your long-term wealth, hopefully, obviously assuming everything goes well.
Because there will be mistakes, there will be the temptations to go and do things in the market that maybe aren’t necessarily great. You’re going to do that thing where you panic-sell a dip and then watch it merrily come back without you. It’s a lot cheaper to panic-sell that dip and lose R500 than it is to lose R5,000 or R50,000 or more, depending on how much money you make one day.
And also buying right at the top, buying into the hype, that’s the other big mistake that people make. Again, rather make that mistake with a few hundred bucks. Start young, start slowly, build up the confidence. Especially I think when you’re doing single stocks, which is obviously outside of the ambit of Satrix, which is an ETF house, and such a useful way to just build that broad market exposure – but the start young lessons are equally applicable. A Satrix Top 40 ETF was the first thing I ever bought in the market all those years ago, I remember, and it really just felt very cool to be like, hang on, I actually have this basket of stocks. It’s the JSE Top 40. It’s in one investment. It was such a great thing to learn about at the time. It’s still such a good memory.
Lauren Jacobs: And I think what you just spoke about, riding out those waves and not selling at the low because you’re scared, it really talks to financial discipline. Because when you start young, you learn how the market moves and knowing that you don’t have to sell when the market is in a dip. You’re training yourself to delay gratification, to learn long-term thinking and also you’re learning to pay yourself first because you’re really paying your future self when you invest, when you start investing young and also when you invest consistently.
And these habits, they spill over into other areas of your financial life. As you learn and grow, you become more intentional with your spending, you’re more aware of what your financial goals are and what the risks are. And you know, risk is a double-edged sword. It’s your risk tolerance but also your risk capacity. So if you have R500 and you need to spend R400 on something specific but you have R100, that’s your capacity of what risk can I take off what income I have.
And also it makes you more confident in your money-making decisions in the future. I think it’s not just about the money you invest, but it’s also the mindset that you develop over time. That’s quite important when you start investing young.
The Finance Ghost: Absolutely. And you can easily get to a dangerous space where you say to yourself, well, I can only invest R500 a month, what’s the point of that long-term, I’ll catch up one day when I earn more. The reality is that is very dangerous thinking because your overheads go up as you get older, on average, for a lot of people. If you don’t learn how to save what you can save when you start doing that, then those bad habits are going to follow you forever. It’s going to always be oh well, I’ll catch up, I’ll catch up, I’ll catch up. And actually, if you wait too long, you can’t catch up, because now you are on the wrong side of compound returns versus someone who actually started young and was consistent and allowed their money to just keep on growing. That’s the point – it’s building balance sheet over time, using your income to build a balance sheet.
It’s like treating yourself like a little company. You have your own income statement, you have a salary and expenses, you build your balance sheet with the profit and if you spend everything, there is no profit and you are not going to build your balance sheet – you’re living hand-to-mouth for the rest of your life. That is not particularly where you want to be.
Lauren Jacobs: And I think what we tend to see where you’ve started investing young, you see that people then tend to save more over their lifetime because they know – like you talk about your income statement, balance sheet – I pay myself first and then I pay all the other things that I want or need and so on. So they tend to save more over their lifetime.
They also, I think, tend to avoid higher interest rate debt because they have this concept of saving. So if you’re paying away more, I think there’s an education thing there around “Actually I want to save more, so why would I take on more debt?” These kind of things could manifest from investing young and also thinking about lifestyle choices. Like you said that bank balance sheet, income statement, how do they manage their financial life around investing and debt and future aspirations and really just staying calm during market volatility.
That discipline of “Even if the market is down, I’m still going to invest my money because I know over time, the market does rebound.” And you think about it like going to the gym, right? You start early, and then the stronger your financial muscles become, it’s just like physical fitness. As long as you’re consistent in your fitness, you know that that consistency is really key.
So even if you start with, like you say, R500, R100, on SatrixNOW it’s R50, you’re just building that habit that can really shape your financial future.
The Finance Ghost: It’s actually such a good analogy because your financial journey is so much like your health. If you drop the ball badly enough and you let it go too far, you may never get it back to where it started or where it could have been. You kind of fall off a certain trajectory and you cannot get back on it.
So that’s actually a great analogy. It really works very well. So, yeah, I like that, I must say.
Lauren Jacobs: And the other thing that I learned specifically when I started investing, it was also around your annual increase. If you are investing R100 a month or whatever that number is, next year, maybe you work in a corporate, you get an increase and it’s 5% more than what you were earning last year, you need to increase that R100 a month by 5% as well.
Because again, it’s in that balance sheet and income statement – you need to do it consistently across everything, from your investing to whatever else you’re planning to do with your finances, you just need to be consistent. Instead of spending that extra 5% on something that doesn’t have future value, spend it on yourself, spend it on your future, your future self.
The Finance Ghost: Yeah. And I think one of the most damaging behaviours that people do when they’re in a corporate environment, specifically two things, actually. One, they assume their salary will be there forever. You only need to have been exposed once to some kind of retrenchment program, whether it affected you or not, but it affects your peers around you. And you see people who just assumed their salary would be there forever and they didn’t need to save anything excess, and they could just kind of bring their overheads up every time their salary went up. And then you get this rug-pull, and now you’ve got to go and potentially find a new job in a country where it’s not easy, etc. etc. – and that can be really bad.
So what that drives is that salary sometimes drives bad behaviour around just this overarching assumption that it will always be there. So, interestingly enough, entrepreneurs often manage their money better because we know that it’s not guaranteed. You’ve kind of got this business where you have to work so hard for everything that comes in, and your income varies so much, that you end up living your lifestyle to one of your lower income months, or that’s what you should do, at least. When you have the high months, it’s like, thank you very much, that goes into the balance sheet. That’s the little nest egg! And so that’s one of the dangers of having a salary is it can actually become this quite dangerous thing that you rely on.
And the other thing that I’ve seen people do is they also spend basically their whole salary and they save their bonus, in theory, which assumes of course, they will get a bonus. And, you know, the word tells you everything – a bonus is discretionary! Like, there’s no guarantee. Have a bad year…
Lauren Jacobs: …do not lay all your eggs on that bonus being paid.
The Finance Ghost: No.
Lauren Jacobs: It’s discretionary.
The Finance Ghost: And look, obviously it sounds very preachy and it’s not meant to because I equally understand, particularly when it’s like school fees, etc. there’s that crunch time in your life where you’ve now started a family and you’re trying to pay off a bond, potentially, if you bought a house, it’s the expensive part of your bond, it’s the worst part of it before your salary increases over many years go up and make your bond so much more affordable, it’s the school fees. It’s that absolute crunch time and for so many of us at an age then where parents sometimes need help as well, there’s a whole generational vibe going on there. So it’s difficult.
There are eras of your life where you are probably not going to save as much as you want to. And then it goes back to the point of this whole podcast, which is if you didn’t start young, when you could save, if you kind of just YOLO’d absolutely all your money, in your 20’s, in the hope that you’ll catch up in your 30’s, I’ve got some really bad news for you about what life looks like in your 30’s, then you’re in your 40’s, and now you’re 20 years out of retirement and you’ve got nothing saved.
That is an ugly trajectory. All the fun you had in your 20’s is going to hurt you later on.
Lauren Jacobs: It’s scary. And I think again, when you talk about “Maybe this month, I can’t put R500 away,” but what a platform like SatrixNOW or EasyEquities or any of those platforms where you can invest as little as whatever the number is – yes, you want to do a debit order, that’s always going to be your first port of call, but the point is that you have the opportunity to invest today, you can invest tomorrow, but you can skip next week and you can skip the week after that but then, when you have another R500, you say, “Okay, wait, I can quickly put this one away.”
So it just gives you that flexibility – as long as you remain consistent, I think that is really the key about building that confidence and that consistency in putting away money that will really set you up for the future. And like you say, investing in your 20’s is almost maybe going to help you in your 30’s because you have that little bit of a cushion to say, okay, I can maybe send my kid to a more expensive school because I have this little bit extra from my 20’s saved up. It affords you also opportunities to enhance your lifestyle in the future.
The Finance Ghost: Yeah, and your money then sits and compounds in the background. Even if you – I mean I’ve seen some of these calcs before where people show the value of saving really hard in your 20’s and like early 30’s and then saving nothing, at all, just letting it compound versus someone who started really late. And the numbers are really scary.
Having said all of that, of course, and this is definitely an important point because I sometimes see you get these, I’m trying to remember what it stands for – it’s FIRE, it’s “something, something, retire early” – basically the principle is save everything and just retire as early as possible.
I also think that’s really crummy advice because you’re also only young once and also – what are you going to do with all your time? In reality your best source of financial wellbeing is having an income and then making sure that you invest a piece of it as well as you can. So you’ve got to make sure you’re looking after yourself. You’re not burning out, you’re living your life, you’re having fun, you’re staying motivated. All of that is absolutely key, but just try and avoid the overly damaging financial choices, especially when you’re young.
I cringe when I see someone doing stuff like financing an R800,000 or R1 million car in your 20’s. I’m like, do the maths on where this ends for you. It’s just horrible and people still do it. They still do it. And this is maybe where the digital tools are so valuable. It’s all out there. You have access to a zillion articles and podcasts that will talk you through why this is or isn’t a good idea. You’ve got access to all of the interest calculators online to go and show what the true cost of this debt actually is. You can go and do all the research on almost anything you can think of and you’ve got access to the budgeting tools to make it as easy as humanly possible to track your spending and see how much you can save at the end of the month. There’s all this stuff that can read your bank statements, read your credit card statements. Generations before us never had this stuff, so use it. It’s there.
Lauren Jacobs: You have no excuse, you really have no excuse to say, “Oh, I didn’t save in my 20’s, or I don’t know how to save,” because the plethora of information and tools that are available online is just incredible. We didn’t have that opportunity when we were younger, so we had to figure it out.
And maybe just to step back into just one more thing on the savings before we talk a little bit about the tools and that – the other thing, obviously, as you get a little bit older, you start thinking about retirement. And one of the big things that impacted me when I started working, few years into work, and the person that I worked for at the time, she said to me, “What you actually need to do when you are not earning an extravagant salary, is start putting away the most that you can for your retirement.” So that’s the 27.5%, right? Because as your salary increases, it becomes more and more difficult to now put away 27.5%. But if you’ve been doing that consistently from the time you start working, it doesn’t affect you because your income after tax is not affected when you now change from 20% to 27.5%. So that’s just something that really stuck with me.
And I talk a lot to new people coming into the business or younger people coming into the business just around considering putting away the most for your retirement from the beginning. So it continues, as your salary grows, so does that 27.5% and you don’t, at some point, need to switch from like a 21% to a 27.5%. And you don’t want that also to be when you’re 45, 50, because it’s not going to be enough at that point. So that’s just something around retirement that was important for me and my financial goals.
The Finance Ghost: Yeah, absolutely. So maybe something just personal about me from that. Obviously I run my own business, so income is variable. But I’ve learned a lot where it ends up and how to get there and everything else. So I generally run my life in such a way that I take a salary based on the lowest amount the business earns and then I save – it is about 20% actually of that salary now that I think about it – and then obviously in a month that’s better, that’s just gravy that goes to the nest egg, literally because you just never know. You never know when you run your own business and I wish more people who earn salaries would also take a “you never know” approach because they don’t actually know. They just like to think that they will have this lovely salary forever and ever and AI won’t take their jobs and they’ll never be retrenched and nothing will ever go wrong. Unfortunately, life is not – adulting is not called adulting for nothing.
Lauren Jacobs: Not for the faint hearted.
The Finance Ghost: No, it’s not for the faint hearted at all. I guess before “adulting” there’s obviously “kidding” which is particularly lovely for the little ones. And maybe that’s something to chat about now as well.
Is it is actually possible to invest when you’re a kid? But it needs to be, I would imagine your parents opening an account on your behalf and I guess there are pros and cons to that. So what’s the story with that?
Lauren Jacobs: As a parent I’ve tried to be consistent to save for my kids and to show them what it means to save and how instead of just using all your money, you can use it to enhance or to create value from that money. And I think it’s important that not only as a parent, but maybe as an aunt, an uncle or seeing your other friends’ kids, it’s important to also bestow that on them. So with SatrixNOW you can invest for your minor child. You have to be the legal parent or guardian in order to open that account. You, as a parent, have to have a registered account with SatrixNOW before you can then add your minor child to the account. For the minor account, obviously they would then have to verify the minor as well with a birth certificate and then a clarification through you as a parent, on the birth certificate is your name.
But generally it’s quite easy as long as you are a registered account holder. If you go onto SatrixNOW, where your account information is at the bottom there is a little tab that says add minor account. And then there they will ask you for all the information they require and the team will come back to you.
Once the account is opened, your child will have their own username and then you would create a password and then from there you can obviously use the tax-free savings account as well. It just means that you have more time to save and you have that tax relief over time. Again talking about taking more risk in the portfolio, it is quite easy actually to do that.
Then if someone else wanted to invest on behalf of your child, we have options in SatrixNOW of vouchers. You can have a debit order where someone else is doing a debit order into your child’s account as well. There are obviously a few forms that you just have to get signed off by that account holder. But there are very many options to then allow your child to get money from other people. You can also give them the account details of the SatrixNOW account, so for birthdays you maybe ask instead of gifts, they can pay into the SatrixNOW account.
So it’s pretty easy and it also then helps you to show your child. One of the things that I did with my child, he had a school trip coming up and I showed him, well, you’ve got a little bit of money, let’s put some of that into your SatrixNOW account and you can see how it grows over time. You have 3, 6 months to save a little bit of extra spending money for your trip. So over time, until it was time for him to leave, we actually said these were the number of units he bought with his money and this is how it moved over time.
And we could see in that time, it grew a little bit, which was great for him to also experience because sometimes we’re investing on behalf of our kids, they don’t really know what’s happening or where the money’s going. They only see later on in life when we give it to them as a gift or if we need to use it for something. But yeah, I think that was quite a great experience to show your child specifically how this number has grown over time or if it went down at a certain time you could also see that. So that was quite interesting from a minor’s perspective.
The Finance Ghost: Yeah, that is super interesting. I guess the con – and I guess it really does come down to the kid and I mean there’s a broader discussion here around parenting – the con is that when your kid turns 18, that child would then have access to that money, right? So if you’ve actually maxed out their tax-free savings account, technically speaking, on their 18th birthday, they could hold the keys to half a million rand, which – even the best 18-year-olds are probably not going to make amazing financial decisions like that.
But yeah, what are your thoughts on that? That’s probably something you’ve considered for your own kids.
Lauren Jacobs: So that is the situation that I sit with now because my kid turned 18 last year. So we’ve had to have very serious conversations like this, it is a large sum of money you need to actually be very conscious of. This is not here to do whatever you want with it. It’s for big financial decisions and we’ve asked that any of those decisions are talked about. We are considered in those decisions that we can then discuss it and see whether those financial decisions are the right ones for that amount of money.
The other discussion also that I think a lot of people should have beforehand is, “Am I actually saving this for your education?” Because education is expensive, tertiary education is expensive. If you are using that, also, maybe just you say: “Why are we saving this money?” We’re saying when you want to go and study, or you want to go and work overseas, or whatever that is, this is there as your nest egg for that. So it’s really a conversation that you have to have as your child gets older. When they become 18, just around what is this really for? It’s not just some fun gift. It’s really a big deal.
The Finance Ghost: Yeah, I think that’s probably the best way to do it because if you then also cover all of the studying fees and everything else, it starts to become, it’s almost just – even if you’re in a position to do so, it’s a lot of money to have responsibility over at a super young age. It really is. So very interesting stuff – it’s such an emotive thing, right? Because any parent knows this – it’s your child and you always want the best for your child and you always have that little fear in your heart as well of: what is the best? Is the best to just give stuff? Is the best to teach them? Obviously it’s to teach them the value of it and to make sure that they can make good decisions.
It’s all very interesting, and I think anyone who goes through the emotional pain almost of thinking through it is already doing the right thing, you’re already a good parent. If it’s hard, you’re doing the right thing. That’s always what I seem to remind myself. It makes me feel better sometimes as a parent.
Maybe let’s chat through some of these digital tools as well. I mean, we’ve had such a cool conversation about just the benefits of starting young, obviously thinking about doing it for your kids, pros and cons, etc. Let’s talk about some of the digital tools, maybe for just a few minutes.
In your world specifically actually, I’m curious about what’s happening there. Obviously, the nuts and bolts of ETFs, a lot of that is very operational processes, etc. Your world, just to be clear to listeners who maybe haven’t listened to the first podcast we did earlier this year, you’re not picking stocks, you’re not doing the asset management of these things. You are making sure that these ETFs do what they say on the tin, which is track the indices that they promised to track. And I would imagine that in your world there’s been quite a few digital tools coming through. So to the extent you can talk through one or two of them or just give any insight, just how rapidly are things changing for you?
Lauren Jacobs: Yeah. So just to put it in context for anyone who didn’t listen before, I’ve been at Satrix for 11 years, and when I started at Satrix, there were spreadsheets. Basically, we had to source data, put it into a spreadsheet, use that data in a spreadsheet.
The Finance Ghost: Good old Excel.
Lauren Jacobs: Good old Excel!
The Finance Ghost: Leading to that lifelong dating advice: don’t hook up where you Vlookup! This was an excellent piece of corporate advice given to us all in our 20’s. Anyway.
Lauren Jacobs: Oh, gosh, yeah. And I’ve seen such a huge change since I’ve started to where we are now because, as you can imagine, the volume of trades that we do on a rebalance on a daily basis is quite intense. It’s lines and lines and lines of trades, and it’s also the number of indices we track.
So we track almost 50 different indices, which means there’s two sets of data in index tracking. One is your index data and one is your portfolio data. And that’s your main sources of how you’re tracking an index or how you’re managing your portfolio. So when it comes to index data, you’ve got this constant – you have to know what is in the index at a point in time, you have to know what the price is, you have to know what corporate actions are upcoming, index reviews are upcoming, and that is all data.
When we look at how do we best execute to reduce tracking error, it’s about using the data as efficiently as we can. And over time, we’ve worked quite closely with a number of index providers where we get the data through FTP sites and then we have internal systems that then route that data into a user-friendly front-end. So we are no longer copying and pasting data from an email into Excel. We’re using all of these options around FTP sites and using scripts internally and certain systems that have been developed specifically for Satrix. So we’ve got a lot of proprietary systems that we use where we then can use all that data from the index providers and then we get all of our data from our portfolios, from our administrators – and how do we match it? We then have a specific system, a proprietary system that we use that’s really developed over time and is constantly developing because it’s changing all the time – the indices change, the types of portfolios that clients want also change.
So it’s a constant enhancement of these internal systems, and it’s just a marrying of your index data and your portfolio data. I’m making it quite simple, but it’s a lot of data. So we’ve got this big data issue that we try and streamline through different systems so that when I open my portfolio, I can see my portfolio, my index, and it’s quite clear what needs to be done. But we’ve just used technology to enhance that big data and how we use it internally. So that’s been the biggest stride for us in terms of using technology internally.
The Finance Ghost: It’s super interesting. I mean what it talks to as well – and again it goes back to that importance of just starting to invest young, etc. – is the world is changing, careers are rapidly changing. You either need to make sure that you are someone who gets to the level of being an expert with what the technology can do for you. So in other words, you’re the person who is using the end product, is driving the need for it, is actually understanding the real world application properly, or the person who’s creating the technology. Those are kind of your two choices right now in the world actually from a career perspective, outside of the obvious stuff that doesn’t apply there.
But I’m talking particularly in a professional services environment, those are your choices right now. And it’s an interesting time to be a young person. The world is rapidly changing. The technology is really coming through hard. You got to try and find some space to save. You’ve got to obviously try and think, well, what direction is my career going? It’s not easy and it’s not made easier by putting yourself under financial strain as well. So I think it just all ties together at the end of the day into the stuff you need to be thinking about relatively early in your life, right?
Lauren Jacobs: Yeah. And the thing is with technology and with these different apps and tools, it makes it more transparent. You’re not wondering, “Should I be saving this or should I be doing this?” There’s all these tools and these YouTube channels and these podcasts like this, where people talk about how you should think about your finances and pay yourself and start. Young people nowadays have such, just compared to when we were young, they have such a huge opportunity to really learn and invest and be consistent over time. Whereas for us, it was a little bit of a black box. We didn’t really know and for our parents, it was very different. There really is an opportunity because of the wealth of information that’s available to them. And it’s not only apps like SatrixNOW. Even on your normal banking app, most banks have a money market or other sort of investments that you can also invest in. There’s just an opportunity there to invest. Even if it’s just doing like a little bit every month, just your banks even have those opportunities for you to put something away.
The Finance Ghost: Yeah, it’s like layers of a cake, right? There’s a money market layer, there’s the ETF layer, there’s if you want to do a little bit of stock picking, there’s all of these different layers in the cake and it’s a nice way to think about it.
Lauren Jacobs: So, Ghost, I mean, I’ve talked quite a bit about index tracking and how easy it is to – well, how easy everybody thinks it is for us to match an index. But I’m sure in your line of work, you have to use some sort of tools or how do you look at different stocks and through research, have you found any applications or online tools to help you with specifically stock picking?
The Finance Ghost: Yeah, absolutely. So there’s a lot out there. There’s a lot of free stuff and the free thing is called reading, which means go and find as many of the investor presentations and earnings transcripts that you can, all of which is available on this wonderful thing called the internet, and then read them! You will be amazed how much you learn from that.
If you are someone who wants to take your stock picking more seriously and maybe you’ve got a bit more money that you are investing in the market that makes it worthwhile, you can then consider some of the platforms that are aimed at retail investors, like TIKR is the one that I use. It’s like a Bloomberg- or Capital IQ-lite, very lite, but good enough so you can do stuff like chart over multiple years what the valuation multiples of a company have done and that lets you very quickly visually see, okay, is this thing relatively expensive or relatively cheap to where it has been? Without something like that, it’s actually quite difficult to really make a success of stock picking specifically.
There are other ways to do it. I haven’t looked in a while, but I remember at one point on Yahoo Finance, you could actually export quite a lot of data into Excel, your old platform there Lauren, do the spreadsheets, do the hard yards, go and build out the stuff. But that is a slog. If you’re someone who really wants to get quite serious about your stock picking, then I think some of those platforms are a very worthwhile investment.
And there are others – there are share trading platforms that allow access to some of this stuff. There are data platforms that allow you to get your hands on this stuff as well.
And then in terms of AI, which I think is obviously on everyone’s lips at the moment, I’m getting very mixed results using something like Copilot, for example. Google AI I do not trust – Google AI is about as reliable as my 3-year-old when it comes to telling stories. Incredible amounts of confidence, low levels of credibility has been my experience with that. Copilot has been a little bit better, but still it’s very limited. I find it’s better for narrative-type stuff. If you actually ask it for “give me a bull case for XYZ stock, give me a bear case” – it’ll give you some generic rubbish every time, but it’ll also probably give you some quite good stuff. It’s got a lot of thinking in the back-end around in the bear case, it will go and see if there’s any major legislative risks or that kind of thing. Again, it works a little bit better on international stuff, but it is something to keep in mind.
So there’s an example of a digital tool that does help, but certainly just reading as much as you can and going and looking at charts. I think people who pick stocks are sometimes – they believe too much that it’s not what they pay for the stock, it’s just whether or not it’s a good company. Unfortunately, that’s not how investing works. You can buy the best company in the world, if you overpay for it, you’re going to have a bad time. Ironically, or conversely, you can also buy a really bad company, but if you pay a really amazing price, you can end up with much better returns than your friend who bought the market leader and can’t understand why they’re 10% in the red.
So those are some of the digital tools, as I say, for those who want to take it a bit more seriously, or quite a bit more seriously, you can look at something like TIKR, you can look at some of the trading platforms out there, see what they can offer you. And I really do believe the key is to be able to draw charts of multiples over time, how the valuation has moved over time, so you can see those averages, you can see the trend. That’s the key piece that you’re not going to get by reading annual reports, reading earnings transcripts. You need a system that’s doing the maths for you.
So, yeah, that’s the world of stock picking. Not quite the big data, data matching – it’s two very different worlds, right? I mean, that’s the beauty of the markets is we both have such different lives, actually, but both in the markets!
Lauren Jacobs: And talking about charting. Maybe just to chat a little bit about charting, even on SatrixNOW, if you go into SatrixNOW, if you’ve made an investment or if you just tap into one of the ETFs, there are charts in there. So it’s quite great that you can see how the market has done over that time.
The Finance Ghost: Absolutely.
Lauren Jacobs: In an ETF, you’re buying the market. So you can go to a Satrix 40 and you can get, since inception, a chart, or you can get for the past three years, a chart. So that’s also quite cool on SatrixNOW that you can then look at what your stock’s doing, look at what the market’s doing, and measure it that way.
The Finance Ghost: And you can learn a lot from fact sheets as well. So the last Satrix podcast that I did was with Siya and we talked a lot about “ETFs like a box of biscuits” and the fact sheet will tell you what’s inside.
And again, it’s very true – I think the overarching point here is just the younger you can expose yourself and your money to the markets, the better. The earlier you can teach yourself good financial habits. The stuff sounds so obvious, but people hear it and it’s almost in one ear and straight out the other again because then they see a brochure for a nice shiny car with a 40% balloon payment and prime less 4%, which is literally financial suicide. But there’s only one way some people learn this, and that’s by going and doing it and then crying the whole way through their 30’s as they recover from that. It is what it is. I’m almost tired of talking about what a bad idea it is because some people just don’t want to hear it.
But anyway, yeah, use the digital tools that are out there. I think if you can turn investing into something you are passionate about, then it will make a gigantic difference because not only are you then doing the right thing for yourself, you’re also enjoying it, which is just a fantastic Venn diagram. That’s the key to success.
So, Lauren, I think we can probably leave it there. Thank you so much for your time. Again it’s been so lovely to chat to you once again. And I would say for listeners who have enjoyed this chat, if you’d like to maybe hear more from Lauren, and if you’d like to learn more about how ETFs actually work in the back-end, go and find the previous Ghost Stories podcast with Lauren. There is only one other one so you can’t get it wrong, and that talks all about the nuts and bolts of ETFs and how they actually work in the background, how they do the index tracking. It’s super fascinating. It was a very popular podcast, so if you haven’t listened to it, go and check it out. Otherwise, Lauren, all the best for the rest of this year. I don’t think we have another one scheduled this year, but hopefully we’ll get you back on in 2026. And yeah, just all the best for the end of 2025.
Lauren Jacobs: Thanks so much for having me Ghost. It’s been lovely chatting to you. Have a good rest of the year to you too.
Traders might find the share price chart rather interesting
Altron has been in turnaround mode for a while now, with the share price more than doubling over the past three years. Recent trade has been choppy though. I’m no technical expert, but there’s been quite the double top this year in this share price, a pattern made more obvious by drawing a 5-year chart:
With that kind of volatility, traders may want to take a closer look at the chart. For investors with a longer-term lens, the latest update reflects an expected increase in HEPS from continuing operations of between 16% and 24%. If you look at total group operations instead, the expected move is 12% to 19%. The difference between the two is Altron Nexus, which seems to make a difference of roughly 10 cents per share in the latest period vs. 5 cents per share in the comparable period.
Full details will be released with the interim results on 3 November.
Blu Label gives a summary of Cell C’s financial outlook (JSE: BLU)
Margin expansion is key to the story
Blu Label Unlimited (the new name for Blue Label Telecoms) has released an updated financial outlook for Cell C ahead of the planned listing of that asset.
For net revenue growth, they expect the typical mid-single digits outcome that we see in many companies in South Africa. This feels like an achievable target, as top-line growth above these levels is hard to find in our country.
EBITDA margin is expected to expand thanks to a change in mix and ongoing efficiencies, increasing from the low twenties to the mid twenties in coming years. Targets like these are often deliberately vague. The same direction of travel can be found in the EBIT margin.
Free cash flow is boosted by a decreasing capex requirement, with the capex-light operating model as a key feature of the business. The group has guided for dividend payouts of 30% to 50% of free cash flow. That isn’t quite the cash cow that you might have expected, with Cell C needing to run at a sustainable level of leverage.
These are decent targets, but are by no means earth-shattering or quite as exciting as one might expect to see based on all the bullishness in the market around this name. Having had an incredible run in price this year, the share price recently corrected and is now trying to consolidate:
Gemfields just cannot catch a break (JSE: GML)
Illegal miners are now impacting the Mozambican operations and even the latest auction wasn’t great
Earlier this year, Gemfields was at serious risk of being a corporate failure. They had run the balance sheet too hot for too long, with a vast capital investment programme and dividends to shareholders at a time when the core business was facing almost existential risks. Luckily, major investors were happy to support a rights offer and give the management team another chance to run a more conservative financial strategy.
The problem is that Gemfields still faces significant risks throughout the business, ranging from the realities of operating in difficult African countries through to the impact of fluid supply and demand dynamics in the gemstones market. Both of these issues are on full display in the latest announcement.
Let’s start with the really bad news, which is that the all-important second processing plant at MRM in Mozambique has been significantly impacted by illegal mining activity in the past week. Plant supply infrastructure is being sabotaged and illegally mined rubies are being removed from the area. Although final commissioning of the plant is expected in October, Gemfields has had to defer the November / December ruby auction to January / February next year. This is a very good example of the kind of thing that investors do not want to see.
We now move on to the mixed news, being the latest auction results that achieved revenue of $11 million. Only 62% of the carats on offer were sold at a realised price of $59.43 per carat. The pricing itself doesn’t tell us much unfortunately, as the grade of rubies varies at every auction. It seems as though the smallest and lowest grade material didn’t sell, with Gemfields taking a gamble here on what they actually brought to market. They will “leverage the market feedback received to refine future offerings” – in other words, the gamble didn’t really work.
I was quite surprised that the share price fell by only 6% on the day!
Jubilee Metals is getting closer to being a focused Zambian copper business (JSE: JBL)
The disposal of South African operations is expected to be completed this year
Over at Jubilee Metals, their sights are set on one thing and one thing only: copper in Zambia. To give themselves as much flexibility on the balance sheet as possible, they are selling off the South African chrome and PGM operations. The first tranche of the sale of $15 million has been received and they are busy with remaining conditions for the deal, including Competition Commission approval. They reckon that the deal can be completed by the end of 2026.
It’s important for Jubilee to keep the market informed about the plans for Zambia, where they have three distinct business units.
The Roan Concentrator is a tailings business that purchases and processes run-of-mine material. Production was in line with guidance in the first quarter, with the upcoming rainy season making it more difficult to forecast how production in the next quarter might be affected. They have experience with the seasonality of course, so perhaps their predictions won’t be far off.
The Sable Refinery is currently being expanded to allow for increased production from nearby mines and near-surface assets, with the expansion expected to be completed in the third quarter this year. They need another $5.5 million in capital at Sable, which they expect to fund from existing cash resources and the proceeds from the sale of South African assets. Importantly, the Molefe Mine (previously called Munkoyo) is delivering run-of-mine to Sable, with improving copper grades. They are busy negotiating with potential joint venture partners regarding this business, including for further mine development.
Finally, there’s the Large Waste Project, which is much earlier in its journey. Final designs for the project are expected by the end of the third quarter and they are in talks with a potential funding partner.
As these assets are all located in Zambia, they aren’t entirely independent of each other in terms of future plans. There are various integration opportunities that the company can look at.
The market has been less than thrilled with the timing of the PGM and chrome disposal though, as that sector is rallying like crazy at the moment. While the big PGM names are registering huge positive share price moves, Jubilee is down 18% year-to-date.
Ugly momentum at Mondi – and not just in the share price (JSE: MNP)
The share price is back where it was 10 years ago
There are certain sectors that I simply don’t invest in. Anything related to paper is one of them, even if there’s a packaging business to try and smooth things out. Cyclical industries scare me on a good day. This chart of Mondi shows you exactly why:
If you have great memories from 2014 that you want to keep alive, then owning Mondi shares will help you think of that year whenever you look at your portfolio. Who needs music and photos when you can just own stocks in the paper industry?
The reason for the 16.5% price drop in response to the latest quarterly update is that Mondi’s numbers are heading firmly in the wrong direction. Underlying EBITDA was €223 million in Q3, down sharply from €274 million in Q2 and €290 million in Q1.
Volumes were impacted by weak demand and paper selling prices declined in the quarter, so that’s a nasty combination. It’s never good when the best thing a company can do is focus on maintenance shuts during a subdued market.
It seems to be getting worse before it gets better, with oversupply in key markets and current selling prices that are even worse than what we just saw in the third quarter!
The only silver lining is that the group has completed its current investment cycle. In other words, they’ve spent a fortune on capital expenditure and they now have to suffer through a poor market for the improved assets. This is exactly why I tend to avoid cyclicals, as the chances of the investment cycle working out beautifully with the market cycle are slim.
This is deep inside the “too hard” bucket for me.
Sirius reports on a seasonally slower period, with ongoing growth in the rent roll (JSE: SRE)
The focus is now on bedding down the recent acquisitions
Sirius Real Estate has released a trading update for the six months to September 2025. Although the rent roll is up 15.2%, around two-thirds of this is thanks to the recent acquisition activity. Sirius has been raising capital and deploying it into assets in Germany and the UK, a strategy that Sirius investors are highly familiar with.
On a like-for-like basis, the rent roll increased by 5.2%. Germany and the UK produced very similar growth rates in this regard. This growth is based on lease escalations and renewal rates, as the asset management focus is on the newly acquired buildings that are excluded from this number.
There are some interesting growth drivers within the group, including in verticals like self storage and defence. The latter is a particularly strong opportunity in Europe, with Sirius appointing a retired Major General and now specialist supply chain consultant to help them optimise the opportunity.
They expect to announce further acquisitions in the next quarter, primarily in Germany. This will add to the almost €300 million in acquisitions across Germany and the UK this year. They have recently raised a significant amount of debt in the form of a revolving credit facility and a bond tap issue, so there’s no shortage of cash available for further deals.
Results for the six months will be released on 17 November.
Tharisa wins against SARS (JSE: THA)
It looks like a significant positive adjustment to earnings is coming
Tharisa has achieved a favourable ruling in the Tax Court against SARS. This relates to mining royalties and the approach that SARS took for the 2015 and 2017 years of assessment, although it has a much bigger impact on the approach that SARS is able to take towards mining companies.
I’m certainly no expert in this space and this is very technical stuff. It sounds like SARS had a difference of opinion to Tharisa regarding the application of an average PGM grade and the incremental cash costs to beneficiate the PGMs to the required standard. This approach effectively assumes a certain income level for a particular grade of mined materials, which is prejudicial to miners with lower-grade ore bodies.
Tharisa previously raised a provision of $56.8 million for this matter and will now recalculate it based on the ruling, with a “materially favourable” impact on earnings per share expected. They will announce more details once the calculation is finalised.
Vunani Fund Managers to merge with Sentio Capital Management (JSE: VUN)
This is why Vunani has been trading under cautionary
Vunani has announced the creation of Vunani Sentio Fund Managers, a merger of businesses that will lead to a combined R60 billion in funds in management. Consolidation of these Black-Owned fund managers makes sense, as scale is key to success in this particular industry.
The deal is structured as an acquisition of Sentio by Vunani. The end result will be that Vunani holds 63% in the merged entity, while current management of Vunani Fund Managers will have 15% and current management of Sentio will have 22%. Notably, Investment Managers Group (part of Momentum JSE: MTM) currently has a 30.05% stake in Sentio and will be exiting the stake entirely, as being diluted to a small stake isn’t part of its strategy.
Vunani Fund Managers is paying for the deal in cash and shares. If I understand the announcement correctly, shares in Vunani Fund Managers will be issued, not new shares in Vunani as the listed company.
The deal isn’t categorisable under JSE rules, so we won’t be getting any further details on it at this stage.
Nibbles:
Director dealings:
Discovery (JSE: DSY) directors and prescribed officers received quite the payday, especially Hylton Kallner as the CEO of Discovery Bank. I’m sure that his KPIs had big green ticks next to them after the bank recently turned profitable! He only sold the taxable portion of his shares, but the same can’t be said for all the execs. Other than sales purely to cover tax, over R40 million worth of shares in aggregate were sold by multiple directors and prescribed officers.
The chair of Mondi (JSE: MNP) bought shares worth over R1 million. He took advantage of a massive negative move in the price in response to results.
A director of Standard Bank (JSE: SBK) sold shares worth R338k.
eMedia Holdings (JSE: EMH | JSE: EMN) is getting value investors hot under the collar at the moment, even if the company seems to have paid a meaty price for the offshore investment in a visual effects business. This is balanced by a significant recent share repurchase programme, with 3.44% of N ordinary shares in issue having been repurchased since 30 September 2025. I suspect that the unbundling by Remgro (JSE: REM) led to plenty of shares being offered in the market, with eMedia only too happy to sit on the bid. The average price for the repurchases is around R1.81 per share, with the N shares currently trading at R2.05. Of course, the downside to repurchases of this magnitude is that they hurt liquidity in the stock, something that smaller companies always need to keep in mind.
In good news for Barloworld (JSE: BAW) shareholders who want to accept the offer from the consortium, the TRP has issued a binding ruling that the final consideration per share must be R120 per share, not the R118.80 that the consortium tried to get through as an adjustment to the price for a recent dividend. The offer is open for acceptance until Wednesday, 15 October.
MultiChoice (JSE: MCG) announced that Canal+ is up to a 72.46% stake in the company. There are further acceptances in place that will take them to 76.52%.
Visual International Holdings (JSE: VIS) is raising R2 million (for context, the market cap is only R55 million) through an accelerated bookbuild process. As the capital raise has been timed in such a way that they aren’t in a closed period, it looks likely that directors will participate in the raise. The way it works is that related parties have to buy shares at the price at which the book closes. The question will of course be whether the market is particularly interested in this raise. It would probably help if the company actually had a working website…
Assura (JSE: AHR) is going through the motions for the cancellation of its listing. The shares are suspended from trading on the JSE and will be delisted on 23 October. In case you missed all the news related to this company this year, Assura was acquired by Primary Health Properties (JSE: PHP), which remains listed on the JSE.
MTN Zakhele Futhi (JSE: MTNZF) has renewed its cautionary announcement regarding the final unwind of the scheme and the calculation of the residual value. They haven’t given an updated view on the timing of when this might happen.
With Jan Potgieter deciding not to stand for re-election to the board of Italtile (JSE: ITE), his long journey with the company (including 5 years as CEO) comes to an end. Notably, the ex-CEO of Pepkor (JSE: PPH), Leon Lourens, has been appointed as a non-executive director. No shortage of retail experience there!
Shareholders in Marshall Monteagle (JSE: MMP) almost unanimously approved the resolutions required to execute the equity capital raising activities of the company.
With the August / September earnings season behind us, it’s helpful to look at share price moves over the past 30 days on the JSE to see how sentiment has shifted.
The winner over this period is clear: PGMs. The winds of change aren’t just blowing in that space, they are positively gusting! There have been other positive standout performances, like Caxton and CTP Publishers and Printers, as well as Purple Group.
On the negative side, a couple of insurance names have had a tough month (like Discovery and Santam), while Sun International continues to struggle with casino demand. There’s been plenty of volatility in the local market, but these moves were particularly interesting to me.
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Transcript:
With the wild earnings season in September behind us, it’s good to look at the market and see where the ducks have been quacking. The Top 40 is up 8.4% over 30 days, an extremely strong run that you definitely shouldn’t just annualise and extrapolate, or we would all be very wealthy. Having said that, the year-to-date increase is 36%, which means that the JSE has put in an exceptional performance this year. These are returns on ETFs, so this is an investable return, not just what the index has done!
There’s one sector that has provided more ducks than anywhere else: mining. The Resources index is up almost 20% in the past month. Again, you can buy the index via ETFs by the way, which means you can have it in your tax-free savings account. Or, you can do some stock picking, with names like Sibanye Stillwater, Northam Platinum, Impala Platinum and Valterra Platinum all featuring strongly. The winds of change are blowing in PGMs at last. This also means that poor Anglo American has kept its unenviable reputation for unbundling companies that go on to rally strongly. Perhaps it’s time to separately list De Beers and unbundle it, as that might be the last hope for mined diamonds!
Jokes aside, there have been some notable moves among mid-caps on the JSE as well. The market responded positively to STADIO’s strong results, but that was nothing compared to the rally enjoyed by Caxton and CTP Publishers and Printers in recent weeks:
Caxton released results in mid-September that reflected 12% growth in normalised HEPS and 16.7% growth in the dividend. They managed this with revenue growth of less than 1%, so this was a story of incredible efficiencies with operating costs up by just 0.1%. It’s rare to see operating leverage coming through for a company with such a tepid growth rate!
The share price is up 17.5% in the past month, a good example of a typical value play, which means a really cheap stock (in terms of the valuation multiple) that is doing better than the market expected. This isn’t to say that things are easy at Caxton, or even that they are going particularly well overall. The company finds itself on a difficult growth treadmill, so this is a particularly commendable performance that was enough to get value investors excited. It’s all about finding stocks with low expectations that then do better than the market thinks they will.
I don’t have a position in Caxton unfortunately, but I do have one in Purple Group. It seems like a rather appropriate thing to check my return on the EasyEquities app, which is of course the key business inside Purple. The price is up 38% in the past month, which means I’m now sitting on a 122% increase in my position. Lovely!
Being patient on this one definitely paid off as I waited for the valuation to come back down to earth. Along with the excellent strides they’ve made in the business and particularly the extent of annuitised income vs. reliance on brokerage fees, Purple eventually got to a point where I was ready to jump in. I’m glad I did!
Why the jump in the past month? It’s certainly not been driven by news, with Purple’s last SENS announcement being in April this year. Based on the absolute cracker of an interim period that they had in the six months to February 2025, I wouldn’t be surprised if we see a trading statement in coming weeks dealing with the full year to September 2025. The market isn’t blind to this either, with EasyEquities rallying at a time when the broader market is rocketing in value as well.
I’m in this one for the long haul, as it feels like a company that has plenty of growth runway.
And as always, the market has winners and losers. Among the companies that had a far less inspiring start to spring, we find some financial services names featuring prominently, like Discovery down 9.6% and Santam down 8.9%.
Santam released results right at the beginning of September and the numbers were actually really good, with a big jump in net underwriting margin from 6.5% to 11.3%. The interim dividend was up 10.3%. Discovery also released an update in September and their earnings were excellent, with HEPS up 30% for the year to June. So, why the bearishness in the market?
I’ve heard theories around a cooling off of growth in certain products and a concern around the sustainability of the current margins. But even then, it’s pretty weird that Santam has suffered such a negative move, with a year-to-date return of -2.9% vs. Discovery up 4% and OUTsurance up 12%. For traders looking for interesting volatility in the local market and perhaps some pairs trading opportunities, that sector is dishing up some pretty big short-term moves.
Here’s another one that really caught my eye: Sun International, down 8.5% in the past month. The casinos are struggling, with income headed in the wrong direction. The Resorts and Hotels part of the group isn’t exactly a rocketship either, but at least it was in the green. Still, this is a company that reported dividend growth of 6.8%, yet the share price took a knock even after you adjust for the dividend that was paid in September.
Yes, there are some adjustments that would typically be made for stocks trading ex-dividend after results, but those adjustments don’t fully explain these recent moves. We’ve seen some major shifts in sentiment, which is a timely reminder that markets are always forward looking. That’s certainly the only good explanation for the recent rally in PGMs, as they released mostly crummy results in their recent financial periods.
What will the end of the year hold and can the Top 40 continue its march to the top-right-hand corner of the page, with the South African market showing a spectacular performance thus far this year? Heading into the final quarter of 2025, there’s all to play for.
Old Mutual will repurchase up to R3 billion in shares (JSE: OMU)
For context, the market cap is over R61 billion
A quieter day of news gave me the opportunity to dedicate space to digging into share repurchases and why listed companies do them. Old Mutual is the latest example, but by no means the only example or even the best example.
The “why’ of repurchases goes like this: if a company believes that its shares are undervalued in the market, then it makes sense to buy those shares back with excess capital rather than pay special cash dividends to shareholders (or worse, feel compelled to do sub-par projects / acquisitions). This boosts HEPS growth over time, as the number of shares in issue reduces each year.
That’s the theory, at least. In practice, we regularly see situations where companies repurchase their shares even when they aren’t undervalued. Companies in the American market (particularly in tech) are by far the worst, using share buybacks to offset the dilutionary impact of share-based compensation to staff. As the icing on the cake, they then disclose adjusted EBITDA that ignores the expense of share-based compensation, even though there’s a cash outflow from the company to repurchase enough shares in the market to offset the issuances. Be thankful for the use of IFRS accounting in South Africa and especially our local concept of HEPS, as it removes much of the scope for nonsense in corporate reporting teams.
Onwards to the mechanics of how this actually works. Most companies ask shareholders at the AGM for authority to repurchase shares, with Old Mutual having been granted a mandate to repurchase up to 10% of shares in issue (this is normal). The words “up to” are critical here, as it gives the company flexibility. Old Mutual received the authority back in May and is finally getting on with it, kicking off a share repurchase programme of up to R3 billion. This is just under 5% of the current market cap, or approximately half of the authority granted at the AGM.
The way this works is that the company appoints brokers (usually large banks) to sit on the bid and buy shares in the market, with the goal being to avoid doing it in such a way that it artificially pushes the price higher and makes the repurchase less attractive for the company. This is why on-market share repurchases are mainly viable for companies with significant liquidity in the stock. Companies with tightly held share registers are more likely to make specific repurchases in negotiated transactions with shareholders. There are far more regulatory requirements for specific repurchases, as you might imagine.
Old Mutual’s share price is flat over 12 months and is trading on a dividend yield of 6.8%, so it’s probably a good candidate for share buybacks. This isn’t exactly a demanding valuation.
Orion Minerals has increased the size of its capital raise once more (JSE: ORN)
Sentiment has swung sharply in their favour recently
For junior mining companies, access to capital is the difference between life and death. Projects require substantial investment to develop them from dreams in the ground to commodity producing assets. Sentiment can also shift quickly in this space, as it takes just one or two major milestones for a company to go from basket case to junior mining darling – and vice versa.
Orion Minerals was in serious danger of slipping into the “too hard” bucket for the market, which is a dark place that few companies emerge from. After a change of management and a subsequent funding deal with Glencore (JSE: GLN), Orion suddenly finds itself in a position where they’ve upsized their current equity capital raising activities for the second time!
Having originally planned to raise R57 million, they increased it to R89 million based on market demand and now they’ve upped it further to R99 million.
This is the share price chart for the past year and it’s quite a thing, with important further context being that the current capital raise is at a price of 17 cents per share (i.e. below where it is currently trading):
Tharisa to transition the Tharisa Mine to underground mining (JSE: THA)
The increase in life of mine doesn’t come cheap of course
Tharisa has announced that they will transition the Tharisa Mine from a large-scale open pit mine to underground mining. The current life of mine shows that open pit operations will be depleted by FY35, so they need to take action to ensure that the mine has a future beyond that date.
They expect total capital expenditure for this project of $547 million, with a peak funding requirement of $173 million. The project internal rate of return (IRR) according to the accompanying presentation is more than 25%.
The investment is spread out over several years, with Tharisa noting that they will need to use internal cash and external funding lines. At the very least this suggests the use of debt, which is no surprise. There’s no indication at the moment that they would need to raise any additional equity capital.
One of the hardest things about mining comes through in this announcement: the company needs to plan a decade ahead, despite great uncertainty over how commodity prices will move.
Nibbles:
Director dealings:
A number of directors of Truworths (JSE: TRU) sold shares worth R11.3 million to “rebalance their investment portfolios” – if I worked at Truworths, I would also sell every single one of my shares to rebalance away from that business.
A director of Thungela (JSE: TGA) sold shares worth R6.5 million.
A director of Sabvest (JSE: SBP) bought shares worth R587k.
Not exactly director dealings in the traditional sense, but a good reminder of the sheer size of the balance sheets of the likes of Christo Wiese: Titan Fincap has bought shares in Shoprite (JSE: SHP) worth R1.05 billion to settle scrip loans. The same Titan entity also entered into a total return swap for the same value.
Labat Africa (JSE: LAB) has new auditors in place and is finalising the financials for the year ended May 2025. They are planning to release them by 15 October.
Globe Trade Centre (JSE: GTC) only has trade in its name, not in its listed shares on the JSE. Still, the company has given us an interesting data point for debt pricing, with senior secured notes due October 2030 priced at a meaty 6.5%. This is by no means investment grade debt, but it shows you how much funding pressure there is for lower quality European companies with speculative credit ratings. Globe Trade Centre has recently suffered credit downgrades by rating agencies.
Pantene, or panettone? When the name of your business makes people think of shampoo brands and Italian fruit cakes, you need to work hard to carve out a space for yourself in the consumer consciousness. Fortunately, a little Y2K panic helped Pantone do exactly that.
When the clock struck midnight on New Year’s Eve in 1999, the world braced for catastrophe. Y2K, also known as the millennium bug, had been on everyone’s mind for months. Since many year dates on computer systems were stored using only two digits (like “98” for 1998), there was fear that the dawning of the year 2000 would cause the computer systems that controlled everything from banking to flights to misinterpret “00” and cause a critical error.
Planes were predicted to fall out of the sky, computers were supposed to implode, and ATMs were expected to become unusable. Caught up in the panic, many people worldwide withdrew as much cash as they could and stocked up on canned goods, toilet paper and water like the apocalypse was coming. It was a tense time to be alive.
At Pantone’s New Jersey office, a group of executives sat around a table and tried to answer a question that would go on to change the outcome of their company. That question was: if there was one colour that could calm the whole world at once, what would it be?
Back to where it started
The Pantone story starts in the 1950s, with a modest little printing business named M & J Levine Advertising, run by two brothers. In 1956, the brothers hired a young Hofstra University graduate named Lawrence Herbert. He was hired for his chemistry degree, but it was his unexpected obsession with tidiness that created real value. Herbert was dismayed by the chaos that ruled the shop’s ink stocks. Colours were messy, inconsistent, and difficult to reproduce. He set to work creating order and streamlining the colour mixing process, and quickly turned the company’s ink division profitable. In 1962 – just 6 years after starting his job – he bought the company’s technological assets for $50,000 and gave them a catchy new name: Pantone.
From there, Herbert set his order-craving sights on the world. He created the Pantone Matching System (also called PMS) to fulfil his vision of a universal colour dictionary. Herbert’s categorisation of colours would allow designers and manufacturers to ensure consistency, whether they were printing a logo in Tokyo, dyeing cotton in Milan, or molding plastic in Detroit.
But wait – why did we need a dictionary of colour?
Before PMS, colour was completely subjective. A colour described as “sunset orange” in one factory could look like “muddy terracotta” in another. For brands, that was disastrous. Just imagine Coca-Cola’s red appearing as cherry pink on cans printed in the US and maroon on cans printed in the East. Pantone’s guides, which take the form of compact “fan decks” of swatches, solved that problem. The idea behind the PMS is to allow designers to colour match specific colours when a design enters production stage, regardless of the equipment used to produce the colour. Today, this system has been widely adopted by graphic designers and reproduction and printing houses.
By 2019, the catalogue had ballooned to over 2,100 colours. Brands got behind this idea in a big way, and soon, many approached Pantone to create signature “trademarked” colours for them. Just how trademarkable a colour really is somewhat of a murky question (and one that Pantone has skated around for years), but that hasn’t stopped the business from creating the signature blue for Tiffany’s (Pantone 1837), a golden yellow for McDonalds (Pantone 123c), deep purple for Cadbury’s (Pantone 2685c) and of course, a vivid pink for Barbie herself (Pantone 219c).
Enter Ms Eiseman
Herbert may have been a whizz at the science of colour, but he felt that he lacked the understanding of the psychology of colour that his clients – which soon included some of the biggest brands in the world – required.
In 1983, Leatrice Eiseman published her first book, Alive with Color, which was a mix of colour psychology, theory, and her own personal passion. Eiseman had been raised by a mother who was both an artist and an interior decorator, and grew up surrounded by colour; her understanding of the link between emotion and colour was therefore practically instinctive. The book caught Herbert’s eye, and he promptly phoned Eiseman and offered her a job at Pantone.
Eiseman was appointed as a colour consultant but quickly moved into the role of executive director for the Pantone Color Institute – a role she has held for 37 years. Eiseman’s magic touch came in the form of giving the colours names in addition to their numbers. Instead of Pantone 17-1463, designers could now refer to Tangerine Tango. She gave us Marsala (Pantone 19-1557) and Radiant Orchid (Pantone 18-3224). These names weren’t accidental – they were little emotional hooks, pulling buyers and designers into the narrative. With Eiseman’s input, Pantone transformed from simply cataloguing colours to shaping the desire to use them.
The birth of “Colour of the Year”
This brings me back to where I started this article – at the anxious turn of the millennium. One of the people seated at that table I described, wondering if a single colour had the power to calm the entire world, was Leatrice Eiseman.
She chose a pretty, optimistic shade of cerulean blue which reminded her of a clear sky. The Pantone team ran with it and announced Pantone 15-4020, or Cerulean Blue, as their first ever Colour of the Year. For Eiseman, cerulean wasn’t just paint on a swatch; it was hope, bottled and sold in a pigment code. The announcement soon caught fire. Newspapers ran with it, designers referenced it, and consumers latched on.
The millennium experiment proved such a runaway success that Pantone turned it into an annual tradition. These days, a big part of Eiseman’s job involves a kind of global treasure hunt, travelling the world to meet a network of elite “colour whisperers”: designers, trend forecasters, and cultural sleuths who have an uncanny sense of what the world will crave next.
Forecasting the future of colour, it turns out, is part science, part sociology, and part detective work. The Pantone team dissects everything from fashion week runways to museum exhibitions, film studios’ animation palettes, upcoming sporting events, and even viral TikTok aesthetics, tracing the shifting hues of global mood and desire, one colour trend at a time.
Sometimes, Eiseman and her trendy team nail it. Sometimes they spark outrage – like in 2019, when they announced the shade Living Coral (Pantone 16-1546) in a year that saw massive coral deaths across the Great Barrier Reef. Oops. Either way, they got attention. The genius of Colour of the Year is not the prediction itself, but in the positioning. Pantone has moved from being a niche brand to a global influencer. Designers, artists, advertisers, even tech companies began shaping products around the annual pick. In the span of 25 years, a once-obscure printer’s tool became the arbiter of global taste.
Beyond the swatch
If you want real evidence that the Pantone brand has become a household name, you only have to look at the success of Pantone Lifestyle, which was launched to capitalise on the brand’s cultural cachet. Imagine swatch-inspired umbrellas, chairs, notebooks, even flasks. The company has found a way to monetise the very thing it used to sell B2B: colour as an object of desire.
It’s a neat trick, if you think about it. Pantone doesn’t make the paint, fabric, or plastic itself. It sells the language of colour in the form of the system, and then it sells the story of colour back to us through lifestyle products and cultural moments.
Whether the world at large feels that Pantone gets its pick right or not, the fact remains that colour provokes. It reflects what’s happening socially, politically, and environmentally, even when Pantone misjudges the mood. The backlash, in its own way, reinforces Pantone’s central role in global discourse
The business of forecasting
Today, Pantone competes in a booming industry of trend forecasting. Alongside firms like WGSN, it publishes reports predicting which colours will dominate retail two, three, or four years in advance.
It’s a high-stakes game. Entire product lines – from Zara’s seasonal collections to Apple’s iPhone case options – may be shaped by these predictions. Get it right, and Pantone steers billions in consumer spending. Get it wrong, and you might end up with a warehouse full of coral-coloured sofas nobody wants.
On the surface, Pantone’s story is about swatches and pigments. But underneath, it’s about control – control of perception, of branding, and even of cultural mood. Pantone turned something ephemeral into something measurable. And in doing so, it built an empire.
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.
The US market is trading ~40% above fair value. What could cause those lofty valuations to deflate? This week on No Ordinary Wednesday, Chris Holdsworth, Chief Investment Strategist at Investec Wealth & Investment International, unpacks the key findings of Investec’s latest Global Investment View, highlighting risks for global investors and where opportunities lie outside the US.
This includes Europe loosening fiscal policy to support growth, China rolling out stimulus, with commodities rallying in response, and South African equities remaining cheap with commodities and improving SOEs providing tailwinds.
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.
Africa Bitcoin Corporation and core investment Altvest Credit Opportunities Fund released numbers (JSE: BAC | JSE: BACC)
At least they have fresh numbersfor the capital raise
Africa Bitcoin Corporation, previously Altvest, has been busy with a lot of things lately. Still, it’s disappointing that the trading statement for the six months to August 2025 came out on the same day as results were released. I’ll say it again: trading statements are meant to be early warning systems. I’m somewhat more forgiving of smaller companies, particularly when they’ve been snowed under with corporate actions, but it’s still not good enough.
We can skip the starter and go straight to the main course, as we have detailed results to work with rather than the trading statement. The company has thrown absolutely everything behind the bitcoin branding at group level and you’ll see that everywhere in the reporting. Gone is the Altvest style of branding that so much effort (and money) was put into. Personally, I think they should’ve just introduced a new class of shares for the bitcoin endeavours, as the entire structure was perfectly set up for that approach.
If you read the executive chairman commentary, you’ll see that the group is focused on two things: (1) building the bitcoin holdings over time, and (2) deploying capital to SMEs through the Altvest Credit Opportunities Fund (ACOF). There’s no shortage of ambition, with a dream of growing from the current level to having a top 100 market cap in Africa within 5 years. They plan to raise R3.8 billion over the next 3 years. Aim for the stars, hey.
Back down on earth, there’s a long way to go. You might be forgiven at this point for forgetting about Umganu Lodge (a sideways NAV story) and Bambanani Family Group (which can only dream of a sideways NAV). There’s little reason for investors to pay much attention to the A and B shares that represent these assets respectively, so don’t feel too bad about forgetting.
The C shares are a lot more interesting, as they give access to ACOF. ACOF is still losing money at an alarming rate. Although it is early in its J-curve journey, I was hoping to see a stronger improvement in the unit economics in this period. Profit before impairment and operating expenses (i.e. net of funding costs) increased from R2 million to R9.6 million, but operating expenses jumped from R10.3 million to R16.9 million. I don’t really understand why that would be necessary at this point. This means that the net loss for the period before tax was R14.6 million vs. R17.2 million in the comparable period. With ACOF looking to raise equity capital, they really needed to show a better rate of improvement in the underlying economics. Just how viable is it to lend at SMEs at such competitive rates?
Despite such a modest decrease in the loss, the valuation of ACOF has jumped from R163 million to R253 million. You can decide for yourself if that sounds reasonable.
Although Africa Bitcoin Corporation reported a profit at group level, this is thanks to the fair value gains on investments. In other words, you have to be comfortable with the incredibly spicy uptick in value in ACOF to feel good about this performance:
I’ve always appreciated the very constructive and candid approach that the top management at the company have taken in their engagements with me. But my concerns remain high and my money remains uninvolved in this story. The main thing I was looking for was a sign of vastly improved unit economics in ACOF. Perhaps it will come in the next period.
Curro has released the deal circular and expects to delist by December (JSE: COH)
This is truly a landmark deal in South Africa
The Jannie Mouton Stigting (Foundation) currently holds 3.36% of the shares in Curro. As we know from following Curro in recent years, there are a number of factors that led to an incredibly disappointing outcome for shareholders vs. the high hopes that the market had for the group a decade ago. Recognising the role that Curro plays from a societal perspective, the major players involved decided that Curro would be more suited to being a Public Benefit Organisation (PBO) rather than a for-profit company that is expected to show annual growth.
This is effectively a social enterprise approach, as Curro is certainly capable of washing its own face and doesn’t need handouts. The challenge is that the business model just isn’t appealing enough to investors, which is why the share price has been under so much pressure. This could’ve led to strategies that could be damaging to the core ethos of the business, like a reduction in capital expenditure at the schools.
Despite much of the ill-informed and often malicious commentary I’ve seen on social media, what we have here is an exceptional example of a billionaire (and those running his family legacy) stepping up and doing the right thing. Instead of trying to buy Curro at a cheeky price, the scheme of arrangement is priced at R13 per share, a 53% premium to the 30-day VWAP. It will be paid with a combination of cash and shares in Capitec (JSE: CPI) and PSG Financial Services (JSE: KST) – two of the best companies on the local market. If this trade was about the money, there is no world in which any profit-motivated party would swap Capitec and PSG Financial Services exposure for Curro. It’s like trading your Ferrari for a Fiat.
Incredibly, the fees related to the transaction add up to less than R2 million. This has to be one of the most efficiently priced schemes I’ve ever seen, with the advisors perhaps recognising the broader rationale and stepping up accordingly.
Bravo, Jannie Mouton and everyone involved.
eMedia Holdings is buying 30% in Pristine World Holdings (JSE: EMH | JSE: EMN)
There’s some clear momentum at the company
Someone seems to have lit a fire under their you-know-whats at eMedia Holdings. This company usually has fewer SENS announcements than reruns of Anaconda on eTV, but that changed recently. The Remgro (JSE: REM) deal injected capital into the business and significantly improved the liquidity of the N shares with a wider shareholder base after the unbundling by Remgro. People are suddenly talking about eMedia!
The positive momentum isn’t going to waste, with the company announcing the acquisition of 30% in Pristine World Holdings, an offshore company that focuses on providing visual effects services to the global film and television markets. Combined with further investment by eMedia in its visual effects studios in Hyde Park, the group will provide clients with the opportunity to use virtual advertising and will enhance its current productions.
The 30% stake will change hands for $6.9 million, or roughly R119 million. That’s certainly not a small deal, especially for a significant minority position rather than a controlling stake. The net asset value (NAV) of Pristine is $22.9 million, so they are paying basically paying the NAV. We only have a net profit number for 9 months rather than 12 months, with no indication of seasonality in the business, so all I can do is annualise the 9-month number to arrive at indicative annual net profit of $2.48 million. This puts the deal on a P/E of roughly 9.2x, which feels like a big number for a non-controlling stake.
It’s possible that earnings are weighted towards the final quarter of the year, but then why don’t they say that in the announcement? And if there isn’t any seasonality, then I struggle to understand the pricing of this deal.
Orion Minerals has increased the capital raise (JSE: ORN)
They seem to be enjoying strong demand from institutional investors
Orion Minerals recently announced an all-important funding deal with Glencore (JSE: GLN). This really kicked the company into a higher gear, with the market believing that things are finally happening.
This is of course an excellent backdrop to capital raising activities, with Orion taking full advantage of the demand in the market. They initially planned to raise around R57 million (the number makes more sense in Aussie dollars than in rands) from “sophisticated and professional investors” – i.e. not a retail raise open to the public. The raise is now up to R89 million thanks to the level of demand for the shares, so that’s rather encouraging.
Prosus is ready to Just Eat (JSE: PRX | JSE: NPN)
It’s time for the European strategy to be demonstrated
Prosus announced that the offer for Just Eat Takeaway.com is unconditional. The deal can now be closed, with 90.13% of the shares in Just Eat Takeaway.com committed to the offer. Remaining shareholders can still accept the Prosus offer until 16 October.
This is going to be the first really big test for Prosus CEO Fabricio Bloisi, as this deal has been conceptualised and executed under his watch. The thesis here is that Prosus can unlock growth in the tepid Western European markets using AI, with the recently announced acquisition of La Centrale in France following a similar theme.
I really like the Just Eat Takeaway.com deal, as it feels like Prosus pounced on this thing at the right time and at a decent price. All eyes are on execution now, particularly with the Prosus share price up 65% year-to-date. This is a chart that I’ve been very happy to own!
Trustco is on the wrong side of the JSE yet again (JSE: TTO)
How does this company expect to cope in the American regulatory environment?
Trustco has found itself in the naughty corner yet again, with the JSE imposing a public censure and a fine of R5 million on the company. The regulator doesn’t take this step lightly, so Trustco really managed to irritate them here.
How did this happen? Well, back in 2022, Trustco subsidiaries entered into a transaction with SBSL Investments that gave that company the option to subscribe for shares in Meya Mining. This was a category 1 transaction, which would require a circular and shareholder approval. According to the JSE, Trustco went ahead with implementing the deal across a couple of tranches anyway.
To make it worse, to date there is still no circular! The jokes about the company’s name truly do write themselves.
I must remind you that Trustco already has a poor relationship with the JSE and has made it very clear that they don’t want to be listed here. The grand plan is to be listed in the US instead. If Trustco treats the US regulators with the same disdain as the South African regulators, then they are going to have a very bad time.
Is R5 million enough for a company’s disregard of the rules for a circular? Personally, I don’t think so. The advisory fees alone would usually come to that number. The fine for non-compliance needs to be a lot higher than the cost of compliance, otherwise there isn’t a strong enough deterrent.
Nibbles:
Director dealings:
I take a somewhat asymmetrical view on director share awards. For example, a director of AVI (JSE: AVI) was awarded shares and sold only the taxable portion, but I don’t really see this as a “buy” because the director didn’t need to put additional cash in. But when a director sells an entire award i.e. not just the taxable portion, it’s a proper “sale” in my books because the director would rather have cash than shares. This was the case for a director of an AVI subsidiary, with a sale to the value of R570k. Director dealings are ultimately only useful for their signalling value to investors, so my approach is based on the typical intent behind the various types of transactions. You may of course have a different view on this!
While on this topic, I should mention that I always ignore partnership matching schemes, in which directors get to buy shares in a subsidised manner (like at British American Tobacco – JSE: BTI). I also ignore situations in which multiple directors simply reinvest their dividends in shares, as we often see at Anglo American (JSE: AGL). Again, it’s all about how strong the signal actually is. These are weak buy signals that are more linked to employment and remuneration than a view on where the share price is currently trading.
And now we arrive at a director dealing that is actually useful, being the CEO of Santam (JSE: SNT) buying shares worth R317k.
Buy signals are by far the most useful form of director dealings, but we should never ignore sales, especially of chunky amounts. A prescribed officer of Standard Bank (JSE: SBK) sold shares worth R3.5 million.
Finally, we get to an off-market purchase that is clearly some kind of negotiated transaction rather than anything else. An associate of the non-executive chairman of Burstone (JSE: BTN), Moss Ngoasheng, has agreed to acquire a whopping R499.99 million worth of shares in an off-market deal. Quite why it is just below R500 million, I really don’t know. The price is R9 per share and the current traded price is R8.05.
If you’re a shareholder in Supermarket Income REIT (JSE: SRI), you’ll be interested in the fact that the fund has declared a dividend for the July to September period of 1.545 pence per share. There’s no scrip dividend alternative, so all shareholders will be receiving the dividend in cash. The exchange rate for South African shareholders will be announced on 20 October.
Telemasters (JSE: TLM) will pay its dividend of 0.2 cents per share (yes, just 0.2 cents per share) on 24 October. Try not to spend it all at once.
If you’re keen to catch up on Southern Palladium (JSE: SDL) and the company’s investment thesis, you can check out the presentation they did in Sydney.
Old Mutual Private Equity (Old Mutual) is to exit its 2018 investment in Medhold to Sanlam Private Equity (Sanlam). In operation since 1988, Medhold is a leading supplier of medical devices in Southern Africa. Its product range comprises critical healthcare devices including anaesthetic delivery systems, orthopaedics, robotic assisted surgery, minimally invasive surgery, patient monitoring, cardiology, maternal infant care, infection control, surgical workspaces and electro-surgical equipment. Financial details were not disclosed.
As part of its strategy to diversify and strengthen its revenue streams within its existing ecosystem, eMedia has announced the acquisition of a 30% strategic equity stake in Pristine World. Pristine World is beneficially owned by UAE’s Convergence IT Services and is a specialist provider of visual effects services catering to the global film and television and commercial markets. eMedia will pay US$6,92 million (R119,1 million) for the stake which will be funded out of existing cash resources and available facilities.
Remgro via its joint venture Pembani Remgro Infrastructure Fund II has invested US$20 million in Kenyan Internet Service Provider (ISP) Mawingu. The capital injection will be used to scale its long-term expansion strategy which aims to impact one million people across the continent by 2028.
Prosus subsidiary OLX has purchased La Centrale in an all cash €1,1 billon deal from Providence Equity Partners. La Centrale is an online French vehicles classifieds platform, the acquisition of which will accelerate OLX’s European strategy to grow highly profitable marketplaces using best-in-class AI tools trusted by dealers and consumers. The deal marks OLX’s entry into Western Europe, giving it a foothold and an immediate leading position in one of Europe’s largest used car markets.
Finbond Group South Africa, a wholly owned subsidiary of Finbond is to acquire a 74% stake in Benefits Bouquet from Eclipto in a transaction valued at R116,3 million. Benefits Bouquet is a provider of services and benefits to consumers, ranging from discount coupons, credit and debt assistance, legal advisory services, financial assistance to trauma and HIV support. The deal will diversify Findbond’s revenue streams and increase the profitability of its South African operations.
Norfund, the Norwegian Investment Fund for Developing Countries, has acquired a 10% equity stake in Anthem, a newly created utility-scale renewable energy platform by African Infrastructure Investment Managers’ IDEAS Managed Fund (Old Mutual). The US$86 million investment by Norfund is alongside Mahlako Energy Fund, an investment and advisory firm owned 100% by Black South African women. The partnerships will drive the platform’s success to deliver c. 11 GW pipeline under the development of Anthem.
In a voluntary announcement KAL Group has advised of its disposal of Tego Plastics and Agrimark operations for an undisclosed sum. The disposal forms part of the company’s strategy to streamline its operations and focus on other segments of the group. It will however continue to purchase agricultural packaging products from Tego. Financial details were undisclosed.
In a move to head off the closure of ArcelorMittal’s local steel businesses, South Africa’s development finance institution, the Industrial Development Corporation (IDC), is said to be preparing to make a bid for the business. In an article published by News24, the IDC’s c.R8,4 billion bid would end two years of negotiations and pave the way for the entry of other international steel companies as the IDC plans to seek strategic investors to run the plants.
The acquisition by Prosus of Just Eat Takeaway.com (JET) is unconditional with 90.13% of shares tendered or irrevocably committed by the closing of acceptances on 1 October 2025. JET will be delisted from Euronext Amsterdam.
On 1 October 2025, the parties to the Barloworld transaction agreed to waive the Standby Offer Condition relating to the receipt of competition regulatory approval by COMESA. Accordingly, in light of the waiver, all Standby Offer Conditions have been fulfilled or waived and the Standby Offer has become unconditional. Shareholders who still wish to accept the Standby Offer have until Wednesday, 15 October 2025 to do so. Results will be announced on 16 October 2025.
Unlisted Companies
Global leader in digital business and technology services NTT DATA has acquired EXAH a local Salesforce Consulting Partner and AI implementation specialist. The acquisition will deliver an end-to-end Salesforce and AI delivery experience to customers across the Middle East and Africa region. Financial details were undisclosed.
Cape Town-based The PURA Beverage Company which manufactures, distributes, markets and sells “better for you” beverages, has secured a R260 million investment from an undisclosed global investment firm. The capital injection will be used to scale the company’s international footprint and business. The investment will be leveraged to accelerate PURA Soda’s market penetration across major retailers predominantly in the US.
Emira Property Fund has acquired a further 130,160,464 SA Corporate Real Estate (SAC) shares on the open market. The shares were acquired for an aggregate consideration of R400,8 million. Together with the SAC shares acquired in June this year, Emira now holds a total of 229,56 million shares equating to an 8.7% stake in the company.
Orion Minerals initially announced a A$5 million (R57 million) capital raising exercise but increased this to A$7,7 million due to level of demand. The private placement comprises the issue of c. 515 million shares at an issue price of 1,5 cents (R0.17) per share – the issue of which falls within Orion’s 15% capacity for issues of equity securities without shareholder approval. A further 66,67 million shares will be issued to Tarney Holdings, subject to shareholder approval in November 2025. The funds raised will be applied to continue early works at the Prieska Copper Zinc Uppers mine and to finalise optimisation studies and ongoing site works at the Okiep Copper Project.
Cilo Cybin, the Cannabis SPAC has transferred its listing from AltX to the General Segment of the JSE Main Board, effective 29 September 2025. The General Segment of the Main Board was launched last year and has seen over 30 companies migrate to this segment, the listing requirements of which are less onerous for the smaller cap firms, providing a flexible, supportive regulatory environment, enabling capital raising measures and significant cost savings.
This week Africa Bitcoin (formerly Altvest Capital) listed on the Namibia Securities Exchange, effective 2 October 2025. The secondary listing coincides with the company’s equity capital raise and allotment of up to 1 million ordinary shares.
Following the successful take private of Assura plc by Primary Health Properties plc, Assura will delist from the LSE on 6 October 2025 and from the JSE on 23 October 2025.
The JSE has advised shareholders that Sebata has failed to publish its annual report for the year ending 31 March 2025 as required by the JSE Listing Requirements and, as a result, the shares in the company have been suspended.
Labat Africa has failed to submit its annual report timeously and consequently trading of its shares on the JSE is under threat of suspension. The company has until 31 October 2024 to rectify the matter.
This week the following companies announced the repurchase of shares:
South32 continued with its US$200 million repurchase programme announced in August 2024. The shares will be repurchased over the period 12 September 2025 to 11 September 2026. This week 1,083,864 shares were repurchased for an aggregate cost of A$2,94 million.
On March 6, 2025, Ninety One plc announced that it would undertake a repurchase programme of up to £30 million. The shares will be purchased on the open market and cancelled to reduce the Company’s ordinary share capital. This week the company repurchased a further 150,000 ordinary shares at an average price 204 pence for an aggregate £305,670.
The purpose of Bytes Technology’s share repurchase programme, of up to a maximum aggregate consideration of £25 million, is to reduce Bytes’ share capital. This week 515,775 shares were repurchased at an average price per share of £3.92 for an aggregate £2,02 million.
Glencore plc’s current share buy-back programme plans to acquire shares of an aggregate value of up to US$1 billion. The shares will be repurchased on the LSE, BATS, Chi-X and Aquis exchanges and is expected to be completed in February 2026. This week 8 million shares were repurchased at an average price of £3.29 per share for an aggregate £26,3 million.
In May 2025, British American Tobacco plc extended its share buyback programme by a further £200 million, taking the total amount to be repurchased by 31 December 2025 to £1,1 billion. The extended programme is being funded using the net proceeds of the block trade of shares in ITC to institutional investors. This week the company repurchased a further 632,298 shares at an average price of £39.29 per share for an aggregate £24,84 million.
During the period 22 to 26 September 2025, Prosus repurchased a further 1,576,035 Prosus shares for an aggregate €90,7 million and Naspers, a further 75,461 Naspers shares for a total consideration of R451,3 million.
One company issued profit warnings this week: Wesizwe Platinum.
During the week one company issued or withdrew a cautionary notice: Hulamin.
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