Harmony Gold has completed the MAC Copper acquisition (JSE: HAR)
The R18.4 billion transaction is just one example of large mining houses chasing copper
Harmony Gold announced the MAC Copper acquisition back in May 2025. It always takes several months to get deals of this size across the line. The good news is that the wait is over, with Harmony implementing the deal with effect from 24 October. The total equity value was R18.4 billion ($1.01 billion), funding using cash reserves and a bridge facility (debt).
Harmony will focus on integrating MAC Copper into their group over the next three months. They will give a detailed update on operational performance and key development milestones when interim results are released in February/March 2026.
Metrofile has released the circular for the Mango Holding take-private (JSE: MFL)
The shareholder meeting will take place in November
After many years of deals waiting in the wings and not materialising, Metrofile shareholders finally have a take-private to consider in the form of a scheme of arrangement. A special purpose vehicle put together by Mango Holding acts as the offeror, with the plan being for the offeror to obtain a platform across Africa and the Middle East. If you work your way up the chain, you eventually land at WndrCo LLC as the largest individual shareholder, a technology investment firm focused on consumerisation of software. That makes sense. There are some other entrepreneurs and high net worth individuals involved who have experience in software as well.
For Metrofile shareholders, it’s much simpler than that: the scheme is a way to sell their shares at a premium of 95% to the 30-day VWAP up to 25 March, the day prior to the release of the cautionary. Before you get too excited about that premium, you need to see a multi-year chart of the share price:
As you can see, the price was extremely depressed when the offeror swooped earlier this year. The price of R3.25 per share is in line with where the shares traded in July 2023, except the offeror would be getting control of the company for this price!
A deal isn’t a deal until the conditions have been met, with the most important one at this stage being the shareholder approval. Irrevocable undertakings have been received from holders of 52.81% of shares in issue. That’s a very good start, but it doesn’t guarantee a successful outcome. They need 75% approval for the scheme.
The general meeting for the vote by shareholders is scheduled for 24 November.
Orion Minerals looks back on a watershed quarter (JSE: ORN)
The share price really tells the story
Junior mining companies are required to release quarterly activity reports to keep the market updated about the progress being made. Even if you know nothing about Orion Minerals, this chart will give you an idea of how important the latest quarter has been:
The biggest driver of this change in sentiment was the signing of a non-binding term sheet with a subsidiary of Glencore (JSE: GLN) for a financing package of $200 – $250 million. They’ve also made a key appointment of a project director and focused on further work at the underlying projects.
If you follow the company, you’ll also know that Orion has been busy with post-quarter capital raising activities. The planned raise was upsized a couple of times to the current level of roughly R99 million. Cash on hand at the end of the quarter was only around R6 million, so these capital raises are very necessary.
Quantum Foods is enjoying much better operating conditions (JSE: QFH)
HEPS shot up in FY25
Quantum Foods released a trading statement for the year ended September 2025. We knew that it was going to be a strong year, as interim HEPS was up by a rather spectacular 244%. Yes, this means that interim HEPS more than tripled!
The full-year move wasn’t nearly as impressive, but nobody is going to complain about a HEPS move of between 58% and 78%. It’s actually worth isolating the second half of the year to get a sense of the maintainable growth rate. In 2H’24, HEPS was 58.7 cents (you calculate this by substracting the comparable interim HEPS from the comparable full-year HEPS). In 2H’25, HEPS was between 52.6 cents and 68.6 cents. You can therefore see that the move in the second half of the year was very tame in comparison to the first half. At the midpoint of guidance (60.6 cents for 2H’25), it reflects growth of 3.2% for the second half.
Why is this the case? Well, it all makes sense when you look at how severely the previous period was hit by HPAI outbreaks (bird flu) and load shedding, particularly in the first half of FY24. This effect was less significant in the year-on-year growth for the second half of the year. Another reason why 2H’25 was softer is because egg prices in FY25 were 17% lower than in FY24. Despite a 79% jump in egg supply, the egg operations actually suffered a drop in profitability year-on-year because of the prices.
Thankfully, the weighted average cost of broiler feed was down 2% and layer feed was unchanged, thanks to a drop in price of soya meal that helped them offset the impact of expensive yellow maize. This is one of the reasons why the farming business was the star of the show on a year-on-year basis, with much higher layer flock numbers driving efficiencies and better cost recoveries. They talk about “much improved earnings” despite a small HPAI outbreak and other irritations like an administrative penalty related to a farm in the Eastern Cape. On the broiler side of the farming business, volumes were up and cost recoveries benefitted as a result.
In the feed business, total volumes were up 9% as volumes supplied to the external market and internally were boosted by the recovery in flocks across the country.
In the other African operations, Zambia and particularly Mozambique were difficult, with the latter impacted by civil unrest and outright theft of 16% of the birds in an incident in December 2024. Uganda thankfully has a far more positive story to tell, with earnings heading in the right direction.
Full results will be available on 28 November. The share price closed 13.6% higher on the day of results, but this was on very thin volumes and you can safely ignore that move. Interestingly, the share price is down 12.7% year-to-date and down 23.6% over 12 months.
Safari Investments isn’t wasting any time with its plan to go private (JSE: SAR)
The circular is out in the wild already
On 17 October, Safari Investments released a firm intention announcement regarding a plan to repurchase all the shares not held by Heriot REIT (JSE: HET) and its subsidiaries. In other words, this is Heriot taking Safari Investments private, but using Safari’s balance sheet. They are in a hurry to get it done, with the circular already released and the delisting date penciled in for 23 December.
Safari’s stock is highly illiquid and Heriot already owns 59.2% of the fund, so a delisting makes sense here. Another reason for the delisting is that Safari plans to undertake developments going forwards, so that makes things difficult for a REIT in terms of consistent dividends.
Irrevocable undertakings have been received from holders of 34.03% of the shares eligible to vote. This is an important point to understand. Heriot and its concert parties have 61.28% of the shares in issue, so only 38.72% of total shares in issue are eligible to vote. From that voting pool, 75% approval is required and they’ve locked in irrevocables from 34.03% (i.e. 34.03% of the 38.72%, not 34.03% of all shares in issue).
Incredibly, the fair value range of the shares is between R7.67 and R8.54, despite the net asset value (NAV) per share being R11.77 as at June 2025. In determining this fair value range, Moore acted as independent expert and used discounted cash flow and capitalisation of earnings. They took note of the much higher NAV per share and applied a market-related discount of 35.16% (based on observable JSE discounts) to arrive at the fair value.
In summary: the NAV of JSE-listed property funds is about as useful as those stapled condoms that once made headlines in South Africa. We know this already, but here it is in black and white. REITs are valued on yield and yield alone. It’s time that impairments to balance sheets were recognised to take this into account.
Nibbles:
Director dealings:
To give you an idea of what truly impressive balance sheets look like, Capitec (JSE: CPI) announced a couple of transactions by the founders. Michiel le Roux executed an option transaction with a put strike price of around R2,754 and a call strike of around R5,251 (the current spot price is R4,030). The expiry date is 1.29 years on average. The options relate to 350,000 shares, or a casual R1.4 billion in shares based on the call price! Separately, an associate of Piet Mouton pledged shares worth R2.3 billion for a loan facility. What do the kids say again? Aah yes, “there are levels to this game”.
A director of OUTsurance (JSE: OUT) bought shares worth over R3.25 million.
A non-executive director of Hammerson (JSE: HMN), bought shares in the company worth nearly R180k through the reinvestment of dividends.
The CEO of Spear REIT (JSE: SEA) bought shares in his family investment vehicles worth R98k.
The CEO of Vunani (JSE: VUN) bought shares worth R4k, adding to his recent purchases.
Canal+ has begun the squeeze-out process to acquire the remaining shares in MultiChoice (JSE: MCG). The MultiChoice listing is suspended from trading with effect from 27 October and will be terminated on 10 December (subject to final regulatory steps). For this reason, MultiChoice will not be releasing its interim results on 12 November 2025 as would otherwise have been the case.
With shareholders having given their support to the Natco Pharma offer, Adcock Ingram (JSE: AIP) has confirmed that the listing will be terminated with effect from 11 November. The scheme consideration of R75 per share will be paid to shareholders on 10 November.
Pan African Resources (JSE: PAN) has officially transitioned from the AIM to the London Stock Exchange Main Market. The company hasn’t issued any new shares in this regard. They’ve simple transferred the listing from the development board to the main board in a move that should help them attract larger institutional shareholders.
Barloworld (JSE: BAW) announced that Nopasika Lila is retiring as group finance director. According to the announcement, she leaves from 31 November 2025 – a date that doesn’t exist on the calendar! Ghostly dates aside, new finance director Relebohile Sehoole will be in that role with effect from 1 December 2025. At least that’s a date that you can find in your Outlook calendar. This is an internal promotion, which is always good to see.
Africa Bitcoin Corporation (JSE: BAC) announced that BDO has resigned as external auditor. This is because Forvis Mazars in South Africa has been appointed as auditor of the subsidiary Africa Bitcoin Strategies, which is en route to becoming a significant component of the group. BDO is looking to avoid a situation where they need to rely on an audit conducted by another firm on a large component of the group. The company hasn’t announced a new external auditor yet.
How a tropical island experiment, a writers’ strike, and a collapsing TV economy gave birth to modern day reality television.
The year was 2000. Pants were worn low, bean bags were everywhere, and you had to hit the number 6 three times on your Motorola Razr to type a letter “o”. Most people were just happy to have survived the Y2K bug. Little did we all know that our lives were about to be permanently altered – because this was the summer that Survivor premiered.
Before this moment, prime-time television was either rehearsed laughter in sitcoms, carefully plotted twists in dramas, or polished faces on talk shows. Then CBS sent sixteen strangers into an island wilderness and waited for a different kind of storytelling to unfold. Instead of a script, the world tuned in to the slow, combustible chemistry of humans under pressure.
It is tempting to tell the story of Survivor as a show that arrived fully formed and changed everything overnight. The truth is messier and more interesting. Reality television had been inching its way into American homes for years. Fox’s Cops and America’s Most Wanted had already blurred the line between reportage and entertainment while MTV’s The Real World (born of the early 1990s) had proved that unvarnished young lives could sustain narrative arcs across a season. But Survivor altered the gravitational pull of the medium. It turned unscripted spectacle into an engine that could fill schedules, attract advertisers, and redefine what networks thought viewers wanted. In short: it launched reality TV.
The market that found its formula
When the finale of the first season of Survivor aired, 51 million viewers tuned in. For context, that number belonged to an era when network television still measured cultural gravity in tens of millions of viewers per event; that year, it was a rating only eclipsed by the Super Bowl. The ratings translated into advertising gold, with CBS reportedly charging $600,000 per 30 second ad slot during the finale. The rest of the industry quickly sat up and took notice.
But Survivor didn’t just succeed because it was entertaining; it worked because it arrived at the exact moment the old model of television was collapsing under its own weight. By the late 1990s, scripted programming had become prohibitively expensive. Networks were paying millions per episode to retain stars, and writers’ guild negotiations had grown increasingly fraught. The 1988 Writers Guild strike (one of the longest in Hollywood history at the time) had already exposed how vulnerable networks were to production shutdowns. Executives began quietly searching for formats that could bypass unions altogether – shows without scripts, without actors, and without the constant threat of collective bargaining.
When Survivor arrived, it offered the perfect economic solution. It required no name-brand talent, no residuals, and no writers’ rooms full of salaried professionals. The drama was human and unscripted, the labour non-union, the costs minimal. Reality television was a new genre, sure, but it was also a business model born out of financial necessity. It allowed networks to fill airtime year-round without the overhead of scripted production, and audiences, exhausted by formulaic sitcoms, devoured the novelty.
No surprise, then, that the following years felt like a chain reaction. CBS doubled down on the success of Survivor by launching Big Brother and The Amazing Race, while Fox answered with American Idol. By the mid-2000s, every major network had a version of reality that suited its brand – ABC had The Bachelor and Extreme Makeover: Home Edition, NBC ran The Apprentice and The Biggest Loser; while MTV pivoted from music videos to household sagas with The Osbournes and Newlyweds. The medium matured not into a single shape but into many: competition, voyeurism, makeover, talent. In 2003 the Emmys created categories to acknowledge the impact. Reality TV had shifted from a curiosity into an industry.
How real is “real”?
From the start, the producers behind Survivor wanted to manufacture chaos. Their original plan for the show’s opening was to literally sink the ship that the contestants were on and have them swim to the island. When that proved logistically impossible (and more than a little dangerous), they settled for the next best thing: loading sixteen people onto a vessel, announcing that they had ten minutes to grab whatever they could carry, and sending them off in rafts toward an island. Things went wrong practically immediately: the waves were rougher than expected, contestants were vomiting everywhere, and what looked like a short distance required more than two hours of rowing to cover. The cameras kept rolling, capturing it all.
The island itself was more wilderness than set. There were no amenities, no real shelter, and, as it turned out, not even sleeping quarters for the crew. Cameramen, sound operators, and producers found themselves camping on the same beaches as their subjects, with their notebooks dissolving in the humidity and their nights interrupted by rats and snakes crawling over their legs. Both cast and crew lost weight, battled parasites, and suffered heat exhaustion. By the end of the 40-day shoot, many were physically wrecked and emotionally frayed.
This is what made Survivor so strangely compelling: its reality was constructed, but the suffering wasn’t. The conditions forced out real tears, real hunger, real desperation. A confession filmed in the middle of that chaos might have been edited for drama, but the emotion itself was authentic; the product of exhaustion and exposure as much as narrative design.
That’s the sleight of hand that defines reality television as a whole. The illusion of pure spontaneity is built on careful orchestration, but the emotions it captures are not false. The cameras didn’t create the breakdowns, but they did make sure the breakdowns were seen. What audiences respond to isn’t factual accuracy, but emotional truth – the visceral, uncomfortable immediacy of watching people pushed to their limits.
The people left to pick up the pieces
The consequences of manufactured authenticity are both personal and institutional. Contestants returning from seasons of Survivor are often in poor physical and emotional shape. Parasites, weight loss, and psychological strain are not rare. The first season of Survivor had “therapists” on set that contestants could request to talk to – but these therapists were on the CBS payroll, and therefore occupied a conflicted place between care and production priorities. After months of deprivation and public scrutiny, many former players described an unsettling sense of betrayal. They had been invited to participate in an experience that promised adventure and exposure, only to find themselves subject to manipulation in service of entertainment.
That ethical tension followed the shows into the culture at large. Reality television has normalised certain types of voyeurism, and it raised questions about consent in pressured circumstances and the responsibilities producers hold toward participants. Those questions have still not fully been answered, even as 57% of new TV programming today is classified as reality TV. Since 2000, at least 38 reality TV participants have died by suicide. The genre built its empire on access to the most vulnerable parts of human experience, but in doing so, it forced us to confront an uncomfortable truth: the line between storytelling and harm is far thinner than television ever let on.
What it left behind
You could argue that Survivor taught television to trade in intimacy. Audiences learned to care about ordinary people in extraordinary situations, to root for underdogs, to analyse social gameplay with the same intensity critics applied to scripted narratives. The genre diversified, hybridised, and metastasised into shows about talent, transformation, and competition. It reshaped summer programming and rebalanced industry economics in favour of formats that could be produced quickly and cheaply.
Two decades on, Survivor itself endures, its edges refined, its craftsmanship slicker, its players more strategic and media-savvy. The island is less of an accident and more of a calibrated laboratory (rumour has it the crew have actual quarters these days). Yet the fundamental equation remains the same: remove the comforts that prop up civilized behaviour, challenge people to meet one another in a confined social field, and let the human drama do the rest.
After all these years, the tribe still speaks. We listen – sometimes appalled, often delighted – and we keep coming back for more, not because we believe everything we see, but because, for a few hours a week, television gives us a mirror that is discomfitingly human. There’s just far more reality TV to choose from these days.
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.
4Sight Holdings is a small cap to watch (JSE: 4SI)
The share price has more than tripled over three years
As the name suggests, 4Sight is a future-focused company that manages to use just about every tech buzzword that you can possibly think of. Unlike most international tech companies that mention AI, 4Sight is more about profit growth than revenue at the moment. This makes it far more interesting than the tech furnaces that burn investor capital in the pursuit of revenue at all costs.
4Sight’s revenue was up just 6.8% for the six months to August, yet this was good enough for operating profit to increase by 35.7% and for HEPS to jump by 30.2%!
The group has four customer-focused segments and all of them are profitable. Services range from consulting through to reselling software for international partners. It’s a model that is clearly working.
Adcorp’s earnings are much higher, but watch out for those once-offs (JSE: ADR)
The prior period included some big non-recurring costs
Adcorp released a trading statement for the six months to August 2025 that reflects a huge jump in HEPS of between 83% and 92.9%. Before you get too excited about extrapolating that growth rate into the future, the company points out that the comparable period included once-off costs of R25.6 million. I went back and checked last year’s numbers: operating profit was R42.3 million and profit after tax was R29.4 million, so not having those costs in this period would explain a big part of the positive year-on-year move.
It’s not the sole reason for the uplift though. Adcorp’s announcement speaks to the benefits coming through from restructuring activities, a necessary step to address challenges around demand and the impact of a stronger rand.
The demand pressure is particularly clear in the Professional Services portfolio in South Africa. You can imagine the negative impact that AI is having on hiring at the moment, with the disruption caused by LinkedIn as another major challenge. Adcorp is seeing its best results in the Contingent Staffing and Staffing Solutions businesses, which makes perfect sense as AI can’t do those jobs and LinkedIn is far less relevant.
It’s much the same in Australia in terms of areas of relative strength, although the Professional Services business on that side of the pond seems to be doing better than in South Africa thanks to the focus on the technology and consulting sectors.
Although the share price closed 13% higher in response to this update, it was on lighter than average volumes.
Yes, it turns out that Afrimat was indeed “primed for a big positive swing” as I wrote earlier this month (JSE: AFT)
Momentum is a powerful thing
Earlier this month, Afrimat released an encouraging trading statement that looked capable of changing the trajectory of the share price during a really tough year. In Ghost Bites at the time, I wrote that Afrimat looked promising for a positive swing and could rally back to the R50 level. After releasing full results on Thursday, the share price closed 14.4% higher at over R45. As I suspected, the market wants to close the gap on this one and see it go up.
But where does that leave us on a year-to-date basis?
As you can see, there’s a long way to go. Afrimat is still running way below the levels of profitability seen in the past few years, and not just because of the impact of the Lafarge integration.
The trick in this period was the second quarter momentum, where things got better in local iron ore sales and the ex-Lafarge cement factory. Markets absolutely love momentum, as share prices move in anticipation of future earnings. When the second quarter is better than the first quarter, the market focuses on the exit velocity for the period and buys accordingly.
For the six months, Afrimat’s revenue was up 29.9% and HEPS almost doubled, up 92.3% to 101.9 cents. For context, this is measured against a terribly weak base, as interim HEPS was 263.4 cents in 2023 before plummeting to 53 cents in 2024.
Part of the gap to historical earnings is that the cement business is still loss-making, despite revenue increasing by a whopping 118.8%. They truly did swing for the fences with the Lafarge deal and the jury is still out on whether it was the right call or not.
Iron ore export volumes need to be highlighted. Although they increased 13.5% year-on-year in the interim period, Afrimat has noted that the full-year volumes are likely to be flat based on expected pressure in the second half from maintenance activity on the Saldanha export line. There are also other major headaches in the local market, like the sad state of play in the ferrochrome industry and what this means for the Nkomati Anthracite Mine.
Afrimat’s share price has turned the corner for now at least. All eyes will be on the momentum in the ex-Lafarge assets in the second half of the year.
Do they ever sleep at ASP Isotopes? (JSE: ISO)
Subsidiary Quantum Leap Energy LLC has announced an acquisition
There are many listed companies that announce only one or two unusual things a year. ASP Isotopes certainly won’t be in that category, as the group is on an aggressive growth path that means plenty of capital raising and deal activity.
The latest such example is an acquisition by US subsidiary Quantum Leap Energy LLC. They are acquiring certain assets from a company called One30Seven, which focuses on decontamination solutions for water-soluble nuclear waste. There’s a lot of cutting-edge science involved here, with the overall goal being to increase the vertical integration of Quantum Leap Energy’s business in the nuclear fuel cycle through the development and commercialisation of the Creber machines that One30Seven is building.
The size of the prize is massive, as the Department of Energy in the US is on the hook for many billions of dollars to store nuclear waste. A solution that could process the waste rather than store it would obviously be of immense value.
As a further delightful little outcome, the initial isotope they are targeting is Cesium-137, which decays into stable Barium-137 – an isotope of increasing importance in quantum computing. It sounds to me like they have a few ways to make bucketloads of cash if this goes well.
The initial deal value is a cash payment of $150k and stock worth $2.85 million. When the first Creber Mini Unit is operational, they will pay a further $6 million. When a Creber Midi or Maxi Unit is done, there’s a payment of $11 million. These names keep reminding me of buying Chip ‘n Dip once a year when I go watch the Simola Hillclimb in Knysna!
The larger initial cost is the consulting agreement with inventor Brian Creber and his company B-Con Engineering Inc, with an estimated development cost of $4.5 million for the Creber Mini and $12.5 – $13 million for a Midi or Maxi Unit.
One30Seven was clever enough to lock in an ongoing royalty agreement, based on 6% of net revenues for 15 years per product. If this thing goes as planned, that’s the most lucrative part of the deal for them.
Liquidity in the stock is still limited on the JSE, but will hopefully improve over time.
Clicks has an outrageously good return on equity (JSE: CLS)
HEPS growth in the mid-teens doesn’t hurt either
Clicks enjoys one of the most demanding valuations on the JSE. That P/E multiple has been earned though, as the company boasts a defensive offering that is taking full advantage of the upward mobility of the average South African consumer in terms of having more disposable income available for health and beauty.
Clicks achieved a return on equity of 49.2% in the year ended August 2025. Yes, 49.2%! For context, that’s 3x higher than most South African legacy banks and with a more defensive underlying business than the banks. It’s little wonder that the market pays up for the story.
There’s also no shortage of growth, with group turnover up 5.3% in this period and trading margin up 60 basis points to 9.8%. Diluted HEPS rose by a delightful 14.1% and the dividend followed suit, up 14.2%.
The private label offering is a highlight, with growth in turnover of 10.7% in the in-house brands at Clicks. Another positive element to the result is the extent of store openings, with 55 net new stores and a total base of over 990 stores. Not every store has a pharmacy, as there are only 780 pharmacies in the store footprint. Pharmacy licensing is a complicated area and it contributes to the ability of smaller pharmacies to compete (if this interests you, be sure to listen to my podcast with Hugh Cunningham of The Local Choice Pharmacy in Harmelia).
When you see such an extensive store roll-out programme, you need to watch out for comparable or like-for-like sales to make sure that all the growth isn’t just coming from capex to increase the store footprint. Clicks managed comparable store turnover of 4.7% with volume growth of 2.1% and inflation of 2.6%, so that’s decent under the circumstances.
The Retail business continues to outperform the Distribution (wholesale) business, with turnover growth of 7% in the former vs. 5.1% in the latter. More importantly, Distribution suffered a decline in margin of 10 basis points, while Retail’s margin was up 70 basis points. The distribution business is key to Clicks’ strategy and needs to be there, but nothing beats the value of having the consumer relationship in the retailer.
In case you’re wondering about the OG of loyalty programmes in South Africa, Clicks ClubCard, they are up to 12.6 million active members who account for 82.6% of sales in Clicks.
As a final fun fact, one of the drivers of higher inventory in the group was demand for GLP-1 product, leading to buy-ins at the wholesaler. That’s an interesting read-through for Aspen (JSE: APN).
The group continues to work towards the medium-term target of 1,200 stores and will exceed 1,000 stores in the coming year. They also plan to get private label participation up to 35% of front shop sales, which will further boost margin. And yet, the share price is flat this year thanks to the extent to which this growth is already priced into the story:
Labat Africa has found a buyer for the cannabis assets (JSE: LAB)
They can now focus exclusively on technology
Labat Africa has been making huge strides recently thanks to the technology assets that were injected into the group. To create a pure-play technology company that might be of more interest to investors, they announced that they were looking at selling the cannabis assets.
After negotiations with several parties, the buyer has been announced. 64P Investments, an unrelated party, will be acquiring the assets for R23 million. This is well above the independent valuation of R15 million to R17 million. It’s much higher than the NAV of R5.3 million.
Here’s the funny thing though: these assets made a profit of R17.5 million in the last reporting period, so these earnings are clearly not maintainable as the independent valuation range suggests a P/E of less than 1x!
This is a Category 2 deal, so shareholders won’t be asked to vote on it.
Raubex’s earnings have dipped (JSE: RBX)
Australia is the problem
Raubex has released a trading update for the six months to August 2025. It’s not good news unfortunately, with an expected drop in HEPS of 10% to 20%.
The Roads and Earthworks division grew its operating profit, with SANRAL projects as the major driver of performance. They’ve won some impressive new tenders to keep things ticking over.
The Construction Materials division seems to be a mixed bag, with weather conditions in March and April affecting the performance in the first couple of months of the period. They have a wide variety of businesses in this space, with underlying drivers like the agriculture sector (positive in this period) and asphalt and aggregates (both off to a slow start that subsequently improved).
The Infrastructure division has been focusing on renewable energy projects and they’ve flagged a “substantial increase” in operating profit for this period, so investors will be pleased with that. The outlook for affordable housing projects is positive, with the company referencing the lower interest rates as a source of stimulus in this space. There are other major projects in process as well, like the parliament buildings in Cape Town and the Potsdam Wastewater Treatment Plant. They are clearly keen for more wastewater work, as they acquired a company called Hlumisa Engineering Services that specialises in this space.
The Materials Handling and Mining division is where some of the challenges are to be found. Their chrome operations were really rough in the second half of the prior year (a R351 million loss), so recovering from that to a break-even performance in this half is a great sequential story. Importantly, Kookfontein’s PGM plant has been commissioned and sales are expected to commence in the second half of the year, so hopefully the PGM market will remain favourable for them. Something else worth mentioning is that although Bauba is performing better than it was at the end of the previous financial year, Raubex is evaluating the long-term strategic direction of the business. When corporates talk like that, they are usually thinking of selling.
Australia is the problem child, with an operating loss this period thanks to a major underperforming project. They lost R210 million on a specific project that was terminated in September 2025. Although Raubex might be able to recover some of the losses, they’ve taken a nasty knock here. The rest of the Australian business is profitable and they’ve been busy with acquisitions and organic growth in that market.
Looking ahead, the secured order book has reached record levels and they are seeing positive momentum in infrastructure spend in South Africa. Things rarely go up in a straight line and Raubex is no different.
A big day for Sasol (JSE: SOL)
The share price closed 17% higher!
It’s hard to think of a better example of a stock that has driven a rollercoaster ride of emotions for so many investors, especially pandemic-era newbies who jumped on the Sasol train in 2020 / 2021. Just look at this share price chart:
When the Sasol price moves, it really moves. It closed 17% higher on Thursday based on the release of business performance metrics (like production volumes) for the three months to September.
The key highlight is that the destoning plant is delivering results, improving coal quality and driving better production at Secunda Operations. They also enjoyed better sales volumes in Fuels thanks to improved performance at Natref and Sasolburg.
It can’t all be good news, of course. Chemicals Africa volumes were in line with the prior period, but revenue was down due to weaker selling prices. The International Chemicals business has a more positive story to tell, with some pricing uplift seen in markets like Eurasia. This was good enough for the international business to achieve “significantly higher” revenue and EBITDA, with the latter supported by margin optimisation initiatives.
The story at Sasol remains one of driving margins in chemicals while doing the best they can in the fuels business and hoping that the oil price does the rest. The breakeven oil price for the quarter was in line with the market guidance of $55 – $60/bbl. Personally, I don’t have much faith in the oil price moving meaningfully higher over time, hence I don’t have a long position in Sasol.
Nibbles:
Director dealings:
The CEO of Vunani Limited (JSE: VUN) bought shares worth R10k.
A director of a major subsidiary of OUTsurance Group (JSE: OUT) bought shares for a minor child to the value of R7k.
Spear REIT (JSE: SEA) announced that the acquisition of Consani Industrial Park in Elsie’s River Industria has met all the conditions precedent. The registration of the property transfer is expected to take place in December 2025.
If you’re interested in Oasis Crescent Property Fund (JSE: OAS), a Shari’ah-compliant property fund that runs with no debt (something you won’t see anywhere else in the sector), then you may want to flick through their presentation showing the portfolio and the future plans.
Mantengu Mining (JSE: MTU) renewed the cautionary announcement related to the potential acquisition of Kilken Platinum. They are busy with the due diligence and assessing the price and regulatory requirements for the deal.
The offeror in the Barloworld (JSE: BAW) deal is up to a 67.3% holding in the company. If you combine this with the related and concert parties, it’s up to 90.6%.
Famous Brands is up, but on shaky ground (JSE: FBR)
The manufacturing segment saved this result– again
Famous Brands has had an extremely volatile share price in the past year. The company is way off the levels seen during the GNU exuberance, but has recently been moving higher after testing the 52-week low. For those who enjoy a bit of momentum trading, this chart might be interesting:
The business itself is doing better than the chart might otherwise suggest, although a deeper dive into the numbers will reveal where the risks are.
For the six months to August, revenue increased 5.6% and operating profit was up 5.8%. This means that Famous Brands achieved margin expansion despite that modest growth rate. HEPS increased by 8% and the dividend per share was also up 8%. It’s always good to see a higher growth rate in HEPS than in revenue, as it means that the company is using leverage successfully.
On the face of it, this looks like a resilient performance that investors should feel good about, particularly as the results for the year to February 2025 reflected pressure in almost every segment in the business. Have things actually turned around?
Let’s dig deeper to see where the improvement lies. Leading Brands (the typical takeaway outlets that the group is, well, famous for) grew like-for-like sales by 2.6% and system-wide sales by 6.0%, a significant acceleration vs. the previous financial year. Interestingly, only 27.8% of new restaurants were allocated to existing franchise partners, so there are lots of new investors who want to own a franchise. Unfortunately, this didn’t translate into any growth in operating profit, with an almost perfectly flat performance on a year-on-year basis.
Signature Brands remains a struggle. The trend of weak sales and a worsening operating margin continued in this period, with like-for-like sales down 0.6% and the operating loss margin moving from -6.7% to -7.0%. The company-owned PAUL restaurants haven’t even broken even yet. Personally, I think Famous Brands should just stick to selling burgers and pizzas.
In the SADC region, operating profit fell by 11.8% despite revenue growth of 2.7%. The AME region saw revenue fall 5.4%, with the operating loss only slightly better at -R19 million vs. -R22 million in the prior period. For context, the AME loss almost full offsets the operating profit of R24 million in SADC! UK Wimpy is just as bad, with operating profit of only R1 million. Why bother?
The supply chain side of the business has been a stronger recent performer, although I worry about how sustainable this is if the restaurants aren’t doing well. Has this continued?
Sure enough, manufacturing revenue increased 10.4% and operating profit was up 23.6%, with margins up from 9.3% to 10.4%. The logistics business runs at paper-thin margins, with revenue up 7.4% and operating profit down 14.8% as margins dipped to 1.1%. Finally, joining Wimpy UK in the why-bother bucket, we have Famous Brands’ retail business with an operating loss of R12 million from revenue of R171 million.
Customers are seeking better value all the time and Famous Brands operates in a very competitive space. Their group numbers look decent this period, but it’s more of the same in terms of relying on the manufacturing side to drive growth.
My view remains that the group is still too complicated and stretched too thin. Much like a pizza base, if you roll the dough too thin to try and cover too much ground, it breaks.
Quilter’s momentum in net flows continues (JSE: QLT)
They are already way ahead of the prior year – and only nine months in
Quilter is demonstrating the power of distribution. For financial services businesses to really make the big bucks, they need to be able to attract flows rather than just manage them. Quilter is doing an excellent job of that, with the third quarter in a row of net inflows in excess of £2 billion. Amazingly, third quarter flows were up 48% year-on-year and represent 7% of opening assets under management and administration (AuMA)!
This is why the third quarter year-to-date net inflow of £6.7 billion is already so far ahead of the full-year 2024 number of £5.2 billion. These are impressive numbers, with a positive story being told across the High Net Worth and especially Affluent channels.
From a profitability perspective, the business is becoming more productive over time (gross sales per adviser increased 10% year-on-year). This implies enhanced profitability at operational level. They don’t disclose profits for the quarter, but it’s hard not to believe that the full-year numbers will be strong based on these underlying metrics.
Salungano Group’s Keaton Mining has signed a coal supply agreement with Eskom (JSE: SLG)
As a reminder, the shares are still suspended from trading
Salungano Group recently released their financials for the year ended March 2024. No, you aren’t losing your mind – they are indeed very far behind. This is why the shares are currently suspended from trading.
Being suspended from trading isn’t the same as being prevented from doing business. It just means that the shares can’t change hands on the JSE in the normal way.
In the business itself, Salungano’s wholly-owned subsidiary Keaton Mining has signed a coal supply agreement with Eskom for the supply of coal from the Vanggatfontein Colliery. Deliveries will start on 1 November 2025 and run until the contracted quantity (6.5 million tons) has been delivered, which is estimated to take five years and two months.
Above all else, this obviously makes a big difference to the going concern assessment at Keaton Mining.
Vunani achieved revenue growth in every segment (JSE: VUN)
This addsto the positivityaround the recently announced Sentio merger
Vunani is having a year to remember. The group has been a tough story in recent years, with the share price still trading roughly 30% lower than three years ago. The stock is stuck in bid-offer spread hell right now, which is why the share price looks like this:
In the underlying business though, there are positive recent updates. Vunani will be merging with Sentio Capital Management to form a combined business with R60 billion in funds under management. Consolidation in that space makes sense, as margins are tight.
Even without the merger, Vunani’s business seems to be improving. The strong performance of the local market is good news for any fund management and securities broking business. Vunnai’s group revenue increased by 8.8% for the six months to August 2025, with each of the underlying segments achieving growth in revenue. The profit performance was a bit choppier, with two of the five segments still in loss-making positions.
By the time we reach HEPS, Vunani’s growth was a delightful 41.8%. They will certainly hope that this momentum can continue.
Nibbles:
Director dealings:
Jan Potgieter has sold more shares in Italtile (JSE: ITE), this time to the value of almost R2 million. I guess if he’s no longer going to be a director of the company, he would rather diversify his wealth. Makes sense to me.
The company secretary of AVI (JSE: AVI) sold an entire share award worth nearly R1.6 million.
Barloworld (JSE: BAW) announced that the PIC has disposed of all its shares in the company in terms of the offer by the consortium.
Marshall Monteagle (JSE: MMP) is selling the Nicol Garage property in Durban for R68.5 million. The purchaser is a private company that isn’t a related party. The property consists of a parking garage and multi-tenanted ground floor units with 129 small business tenants. The income at the property is R1.6 million per month. The net asset value is a whopping R132.7 million, so they are selling this way below book. The property made a loss of R9.4 million in the year ended March, which might explain why they are happy to let it go at this price.
In happy news for the overall functioning of the market, Insimbi Industrial Holdings (JSE: ISB) announced that the erroneous broker trades that we saw last week are being fixed by the broker. The announcement doesn’t clarify exactly how this fix is happening. This includes the CEO’s trades. This affected a number of companies, but I assume that Insimbi being corrected means that all of them are being corrected.
Hulamin (JSE: HLM) has noted that they are hosting an investor day on Thursday. Keep an eye out for the presentation!
aReit (JSE: APO) is still trying to get audited financials done. They’ve now submitted financials for the year ended December 2023 to the auditors who previously resigned because they ran out of patience. Those auditors are considering whether they will take aReit on as a client again or not. The financials for the year ended December 2024 are also ready. They would also need to get interims for the six months to June 2025 done before the suspension can be lifted!
AYO Technology (JSE: AYO) has received the compliance certificate from the TRP for the delisting offer. The delisting will be effecting from 28 October.
We all need somewhere to live, but that doesn’t mean that buying property should be the default decision. Most of all, it doesn’t mean that buying any property at any price is sensible. Data-led decision making is crucial when buying a home, especially in South Africa where house prices don’t automatically go up.
Hayley Ivins-Downes and the team at Lightstone Property are passionate about helping South Africans apply more science to the emotiv decision of buying a home. With incredible data on property across the country, Lightstone makes it easier to avoid turning a dream home into a nightmare.
On this podcast, Hayley unpacked topics like:
Relative property values across provinces and the trend over the years
Development activity and the types of properties being built
The effect of the interest rate cycle
Semigration trends and the impact they have on values
How the average age of buyers has increased vs. ten years ago
The question on everyone’s lips in Cape Town: has the property trend reached a relative peak?
Property is one of the most important financial decisions you can make. If you do the research before you buy stocks, you should certainly do it before you buy property. You can learn more about Lightstone here.
Listen to the podcast here:
Transcript:
The Finance Ghost: Welcome to this episode of the Ghost Stories podcast. Thank you for being here with us. You’ve probably clicked on this because you have an interest in the property sector, and I think you will be well rewarded for that by getting some fantastic insights into the South African property market because today I have the great joy of speaking with Hayley Ivins-Downes. She is the Managing Executive of real estate at Lightstone Property.
Lightstone is fascinating because they have all the data, just all of it, basically – it’s brilliant! I’ve seen the reports, I’ve seen some of the stuff that you’re able to put out there, Hayley. I actually asked an agent for a Lightstone report, quite literally this week because I’m doing some planning around real estate for myself personally over the next few years. Data-led decision making hey – that’s something I’m passionate about, it’s something that you’re clearly passionate about.
So, Hayley, welcome to the show. Thank you for doing this. I’m very excited to dig in and get some fantastic insights from you.
Hayley Ivins-Downes: Great. Thanks, Ghost. It’s really great to be here and to be able to share some of our insights and knowledge and data from Lightstone. I think it’s really important for any homeowner / buyer / seller to make sure that they’ve got all the right information and making these decisions.
The Finance Ghost: Yeah, absolutely. And you’ve been with Lightstone for quite some time, so plenty of experience on this podcast, which I’m excited about.
So let’s maybe get a lay of the land, quite literally, actually, when it comes to Lightstone. I think people know the name, but I’m not sure that enough people know that they can ask for these reports from their agent. They can even go and buy the reports themselves. So let’s just get an understanding of what Lightstone actually is. What is the data set, how has it been built and why is it important?
Hayley Ivins-Downes: Lightstone is actually part of the Halls Group, coming out of Nelspruit and Mpumalanga area. We started in 2005, really just focused around offering information and valuations. We started by developing a residential property valuation model that the banks currently use in terms of granting of bonds. And so we use a lot of the deeds data. We’ve got all the history, all the transactions, and we obviously get a lot of insight out of that information.
We have over the years built up reports and specifically focusing on certain segments of the market – your banking, your insurance and your real estate. And for the man on the street, the home buyer, the homeowner, the home seller, we also have valuation reports which you can purchase with a credit card, pay as you go, which really makes it a lot easier than having to sign up.
Just as a matter of interest, when I was looking for a property, it was actually really quite important to ensure that you have all of this information. So sometimes it is not a bad thing to sign up for subscriptions because you have a month, because it does give you a lot of information on the area that you’re possibly going into and what is actually happening in that area on the property side.
So we’ve built up obviously a wealth of information over the years, and that just keeps us going and providing more information for really anybody in the property industry or sector.
The Finance Ghost: You’ve raised a really interesting point there, which is that the banks use this for valuations and a lot of people get caught out by this when they go and buy a house. So sometimes you have a buyer who just gets too hot for the deal and the seller and the agent manage to make it work. I mean, this is a negotiated transaction so if you don’t have your wits about you, then you will overpay for property.
And then you put in your offer to purchase and it’s subject to bond finance. And you’re assuming you’re going to get a 100% bond, and you might get a 100% bond – on the value that the bank thinks it’s worth! And if the bank thinks it’s worth R1.5 million and you’ve offered R1.7 million, you’re going to get a R1.5 million bond because the bank thinks you’re overpaying and so they don’t have enough asset cover on the bond. Is that accurate?
Hayley Ivins-Downes: Absolutely. I think that’s one of the benefits of having a Lightstone valuation report. This is really the valuation that the banks see as part of the process of granting the bond. They obviously assess their own credit information on the back-end, essentially on the buyer, but they use our valuation model and what our estimate is to help guide them as to whether they should be granting the bond and the amount that should be granted. So it’s really quite important to also have that knowledge before you buy the property, to understand what the bank may be seeing in terms of the process, in terms of the valuation estimate on the property you’re looking to purchase.
The Finance Ghost: A lot of people listening to this will be investors in shares on the market. This is just doing the valuation work, but for the property. You wouldn’t go and buy a share at any price – or you shouldn’t go and buy a share at any price – but people behave this way with property because I think it becomes such an emotive decision. You fall in love with a house or sometimes you live in a market where you end up in a situation where you’re squeezed on where you’re going to be next because rental stock is not always available. You can tell I live in Cape Town, it’s a very much a lived experience there – rental properties are not always available where you want them!
Or you want to try and lock in a specific house because your kids are starting school – there are a lot of reasons why people overpay for property and a lot of them are well-meaning reasons. These are not irrational reasons, but it can become a real issue down the line, not only from a bond perspective, but also just in terms of – you might really regret it in years to come. If you significantly overpay for a property, you can end up effectively underwater in that thing. At some point the shine comes off and you look at this and say, wow, how much financial damage have I done myself here? As opposed to just renting or even better, buying at the right price. So I guess that is where Lightstone is just so important.
Hayley Ivins-Downes: So important. I think it’s really – once you purchase a property and at the end of the day we do need to live somewhere – but also once you make that decision in terms of purchasing the property, just understand also in terms of the growth of the area, in terms of where the properties around you are actually growing in value, are you investing in the property in the right way? So if you’re going to be spending money, is it the right investment that you’re doing? Because at the end of the day, five years down the line, 10 years down the line, will you get some level of return on your property?
And I think we’ll discuss further down in the podcast, but you’ll see that in many areas, property is not the greatest investment from a short-term to medium-term at the moment. We really need to be astute and understand where we’re actually investing and what property we’re purchasing.
The Finance Ghost: Yeah, I will beat this drum all day. I absolutely agree with you. You’ve got to buy a property for the right reasons. The property you live in – there are a lot of good reasons to buy the place you’re going to live in for a long time, I’ve run a lot of the numbers myself, what annual growth you need to see in properties to make it make sense over a 7-to-10-year holding period.
Because that’s the other thing people say: “This is my forever home.” Forever is a really, really long time – people’s jobs change, their careers change, their spouses sometimes change, their kids move school, things happen and so if you overpay – and I think a big part of the problem is obviously just the costs on the way in and on the way out, transfer duty, etc. is so onerous that you can’t just – it’s almost like having a kid, you can’t put it back, you can’t go and buy a property and then 12 months later say, oh dear, I can’t own this thing anymore, let me get out of it. You’re going to take a massive, massive bath.
And the problem is it’s going to happen on an asset that is worth millions because it’s a very over-leveraged position. It’s like going and buying shares in a company, borrowing money from the bank and then not caring about the valuation. You would never do that. So why do people do it with property?
Hayley Ivins-Downes: No, exactly. Exactly! Anecdotally, just to share with everybody. We used to live in a suburb in Johannesburg and we purchased the property 10 years ago or 12 years ago and we paid a price…
The Finance Ghost: …oh, my condolences. I know where this story ends. It can’t be good.
Hayley Ivins-Downes: No, we sold it two years ago to move. We made a loss on that property.
The Finance Ghost: Yeah.
Hayley Ivins-Downes: We got less for that property than what we had paid!
The Finance Ghost: Sho, never mind inflation.
Hayley Ivins-Downes: No, never mind inflation. So I think it becomes really important just to keep your head up when you’re buying a property and not let the emotions run too much. Be aware of the area that you’re buying into because areas can decay and that also obviously affects your investment. So yes, all of these factors play a really important part.
The Finance Ghost: No, they really do. I mean, the last maybe anecdotal piece and then we can dig into some of the data that you’ve got at Lightstone about property – I think we’ve really landed the point around how important this is.
So I did my articles in a banking environment, which means I had access to staff rates on a home loan. And conventional wisdom, certainly from my parents’ generation, was always: don’t pay someone else’s bond! I mean, how many times have you heard that? Every time you pay rent, you’re paying off someone else’s bond? Pay off, just every payment is one more brick. You have heard all this before.
I naively in my articles was like, well, I have got access to this incredible bank rate, let me buy this little apartment in Joburg, and I came out okayish but definitely down versus if I had just rented. Without a doubt, I absolutely should have just rented. There is no reason on earth why I should have bought that property at the age I bought it when there was so much uncertainty over where my career would take me. There were no kids that needed a stable environment. It was an absolutely nonsensical decision with the benefit of hindsight.
I always encourage people: property can be the best decision you ever make and also the worst decision you ever make. It’s not like pressing the “buy” button because you feel like some shares in Sasol, you can get out of those pretty easily. It’s not the same in property.
Hayley Ivins-Downes: No, no. Do the numbers, before you make a decision.
The Finance Ghost: So let’s do some numbers because I think this is what we’re really here for is to understand what you’ve got in the data. I think one of the big South African talking points obviously of the past decade, has been the shift of wealth. You’ve talked about it now from Gauteng to effectively the Western Cape. I think that’s where most of it has gone. Another big talking point has been something like how vulnerable the Eastern Cape economy has actually been. And of course the beauty of property data is this is one of the ways you can just see it unemotively. Take out all the politics, take out people shouting at each other, property prices, willing buyers, willing sellers en masse dealing with having to take a view on somewhere in the ground. There’s no better measure than that.
Hayley Ivins-Downes: Yeah.
The Finance Ghost: So based on that, I’m very keen to see what stats and what trends you might have around that whole shifting-of-wealth-around-the-provinces point.
Hayley Ivins-Downes: Great. I think let’s start – probably good just to understand the total value that we’re talking around. If we had to look at the full property industry in South Africa, we’ve obviously divided that into residential and non-res, and your residential component basically makes up 85% of that. Total number of property stock: 8.55 million, just to give a view in terms of the legally owned property. And looking then at the value, total value of R13.5 trillion and of that, 54% in residential.
If we start now trying to understand what’s actually been happening in terms of the market and how it’s been shifting. So it’s been really interesting just to see specifically after Covid – but if I just do a little bit of a dig in terms of where the property market value has shifted, I actually managed to find an older version – 2015 – in terms of where we kind of showed the shift. In 2015, Gauteng was basically sitting with 38.4% of the value. Western Cape was sitting with 26.8% of the value. Third one, always coming in third is your KZN, and that was sitting at 12.3% of the value. And then I’ll get into Eastern Cape a little bit further on.
But if we just bear in mind the differences specifically between Gauteng and Western Cape. Up until now, what we’re saying now, 2025, basically Gauteng is now sitting at 36.9% of the value, so basically a drop of 2%. Western Cape has jumped up to 30% of the value so climbed 3.5% / 4% of value. And if you think about the value, that percentage of the R13 trillion, it’s a big number.
If we start looking at where the big difference started to happen, it was really post-Covid. So 2020, what we saw was interest rates dropped, an all-time low in 50 years, so it was really a big drive towards buying your property. It was certainly a buyer’s market – owning your own property as opposed to renting. And we saw this shift starting to happen and we saw 2020, I mean Gauteng was sitting at 38%, Western Cape had already started jumping up to 28% and then it just started increasing. We started to obviously see that shift – and we’ll get into more detail around semigration further on – but we’ve definitely seen the shift of value move definitely more down to the Western Cape.
Gauteng is still sitting at the top in terms of value, but Western Cape has certainly started catching up. Gauteng dropping.
The interesting component of KZN is it really is flat. There’s been hardly any movement. If we look 10 years ago it was 12.3%, it’s now 12.15%. So really tiny in terms of the shift.
The Finance Ghost: It really is Gauteng to Western Cape. I mean that’s what it’s done, right? It’s incredible.
Hayley Ivins-Downes: It is, definitely the biggest shift. And I think just linking into that, we obviously saw the shift of the ability to be able to work anywhere. So you didn’t need to go into the office. There was definitely a phase where that was happening. And so people used the opportunity to really move where they felt they wanted a better lifestyle or the fact that they could have better experiences. And obviously, the biggest view is Western Cape is running better from a municipal / provincial angle, so that’s also an interesting conversation on its own.
And then if we drop into the Eastern Cape, so the Eastern Cape economy has really been struggling. And I mean, if we go back 10 years, the value of Eastern Cape was sitting at 6.4% of the value. It really is now 6.29%. So it’s actually been declining in terms of what’s happening in the Eastern Cape. And it’s almost like a bit of the forgotten province and yet the potential there is huge.
Anecdotally, I was just on a hike on the Wild Coast, and I just think the potential for that area is so big, specifically from a tourism point of view to lift up that area. But we’ve definitely seen on the property side, that there’s been a bit of a slide on the value side of it. Even on the volume in terms of activity and transactions, also a bit of a drop. So, yeah, it’s definitely been the one that’s stood out as the drop that we’re seeing. It’s been interesting just to see the differences in the provinces.
The Finance Ghost: I mean, there’s a lot of interesting stuff to unpack there. In some ways, it’s actually not as big a shift as maybe some people might have expected to hear, because everything you get fed is obviously cost of living, cost of living, but of course, the cost of living comes through in a slightly tweaked metric, which is to compare the value proportion in a province to the volume of properties, because you get so much less for your money in the Western Cape.
Obviously I still have friends in Joburg and we’ll sometimes just laugh about – not laugh, but you just say, like, what is this house actually worth? And it’s this fantastic home in Joburg for a couple of million rand. And in Cape Town you are getting, if you are lucky, a complex – you know, you’re sharing walls with people for that sort of price. Joburg, you’re leaving behind a whole standalone story with a garden and a pool and a braai and three garages and the whole shebang. So it’s incredible.
I remember when I was in high school and I would get my parents to sometimes take a detour because I used to love going through the old areas of Joburg, certainly never grew up in them, like Westcliff, Houghton – just absolutely stunning. I looked the other day for fun at houses in Westcliff and what they’re worth now and I remember what they were changing hands for 15, 20 years ago. And it is just horrific! Look, people who owned Westcliff houses at that time, I don’t think that they care too much to be super honest about where the value went, they’ll be okay, but still no one wants to see their houses go down in value. That’s the reality. And it’s when you look at that top-tier property band that I think the Joburg / Western Cape difference becomes so stark. It’s amazing actually because I mean the stat is Western Cape is 30% of the value of South African property. But what percentage is it in terms of volumes?
Hayley Ivins-Downes: So volume wise, also quite interesting, it is 18% of the volumes compared to Johannesburg of 34%.
The Finance Ghost: Yeah. So that shows.
Hayley Ivins-Downes: It’s a big jump in volume compared to value.
The Finance Ghost: Massively. And that makes sense.
Hayley Ivins-Downes: That leads to it, it leans into what you’re saying. Yeah, we’ve seen the super luxury areas of Johannesburg take quite a knock in terms of property and what sellers are actually getting for their properties.
The Finance Ghost: Yeah, absolutely. And the other interesting thing in everything you were talking about there was, I think you made a comment that during the pandemic it was quite a buyer’s market because obviously you could get access to finance. So of course, the contrarian investor in me flicks it around and goes, well, that makes it a seller’s market! And the buyer’s market is when I can walk in because there’s no one else who can buy it. But because I bided my time and I can therefore get the debt and I’ve got the deposit – and that’s the way to think, you’ve got to almost think countercyclically if you want to make money in property. It’s just like buying stocks. Almost exactly like buying stocks. You’ve really got to think that stuff through, in a big way, actually!
Speaking of stocks, of course the other thing that happens on the market is you end up with growth stocks that are very hyped up and nothing can ever go wrong. And actually I’ve used this anecdote on another podcast before, but I’ll use it again. So one of the best deal makers I worked for in my career sold this absolutely magnificent home in Cape Town 10 years ago now for an eye-watering amount of money. It had been on Top Billing. It was just, it was absolute perfection! And I just distinctly recall, he hosted a braai there, this amazing house. And I remember saying to him, why on earth would you sell this? And he said to me: exactly! And that was his answer. Because there’s nothing wrong. Because everything’s perfect. Because the sun is shining down on this right now and anyone who comes to visit it is going to think exactly like you think, except maybe they have the big number to get it out the door.
And he was right. He sold it at the absolute – probably the peak. We saw Cape Town properties kind of hit that bubble period and then there was a little bit of flatlining, etc. And the problem is if property prices are flat, you are losing money versus renting. That’s the maths. Because of rates, because of the costs of maintenance, because of all of the money you incurred on the way in and what you could’ve done with the transfer duty that you had to hand over to the government, etc. People forget the opportunity cost in a big way.
And anecdotally, it feels to me like the Western Cape has run out of puff a little bit, just because I can’t understand how people are affording these homes given the jobs available in Cape Town. Are you seeing that in the data?
Hayley Ivins-Downes: We’re getting a hunch of the fact that it’s slowing down. And I think for various reasons. I think there’s a reality check in the fact that potential buyers or renters are questioning what prices are being priced at and what sellers are wanting for properties. And then the other part of it is there’s also a limited stock issue coming in. We’re finding that you speak to the estate agents on the ground in Cape Town and some of the areas where there’s a big, obvious, focus around buying properties and there’s a great demand and those properties don’t even make it to the portals, they don’t even get listed because those estate agents are sitting with such a list of buyers, that they just let the buyers know that this property is coming on the market and it’s literally sold, some of them within hours.
We’re starting to see questions around some of the prices that are being asked. And then linked to that is obviously the fact that actually because there’s no availability of stock, the demand is there, but then people are going, oof, but you know, am I willing to actually pay that for the property? It’s quite interesting – I’ll touch on that when we start looking at indices, because I think the index gives us quite a good view in terms of what’s happening with the Western Cape property market versus the national. But we’re kind of starting to see that it’s not as rosy as it was.
The Finance Ghost: Yeah. Because it just can’t be – realistically, there are just only so many jobs that actually support houses that are R5 million / R6 million. I mean, let’s say you do have a bigger family, maybe I don’t know, in your 40s and I’m really stereotyping, whatever, late 30s, early 40s, earning well and you’re looking for a big family home. Joburg, R3 million – you’re styling! You really are! Cape Town, it’s R5 million+ to get the same thing or anything close – not the same thing, just to get something of a similar relative standard. That is a very big difference.
And then on top of that, I do think that a lot of the salary gap has closed, but the number of jobs is still completely outweighed by Joburg. And there’s been this big call back to office. People have been severely caught out. They went and bought a house in Hermanus, thinking that they could work on Zoom for the rest of time. Unfortunately, this hasn’t been real life, so semigration feels like it is slowing down.
Hayley Ivins-Downes: Absolutely. And we’re starting to see that as well.
The Finance Ghost: So, bullish the Gauteng property market, potentially.
Hayley Ivins-Downes: Yes!
The Finance Ghost: Because to your point, people need to live somewhere, you know.
Hayley Ivins-Downes: Have to live. Yeah. And then also just looking – and you mentioned semigration, I think that’s quite a good topic just to jump into because I think that also then aligns with kind of what we’re seeing with the Western Cape / Gauteng.
I also just want to just say, there’s a lot of talk around semigration, but the percentage of people moving – and what we define as semigration is obviously moving from one province to the next – let’s be really mindful that it’s like 4% to 6% of the actual number of transfers that happen over a year. So it’s really a small number. We’re just aware of it a lot more because we’re just hearing of it a lot more and it’s had a jump up since COVID.
If we had to look at what was happening – semigration happens all the time, but what we did see was after COVID, so 2021, 2022 and also 2024 actually interestingly enough, big jump up, spikes of semigration of people moving to Western Cape. 2024, we’ve had nearly 10,000 homes over 2024 and a little bit of 2025 and the majority of that coming from Gauteng.
Then just also looking at the interprovincial movement, once again, the biggest jump is up into the Western Cape. And interestingly enough, also a lot of people from KZN also moving to Western Cape. So it’s definitely your Gauteng and your KZN that are feeding into your Western Cape. But Western Cape is definitely the province where people are semigrating to, that we’re seeing.
And then Ghost, you mentioned earlier that this semigration – we spoke about the value of property and whether people are moving for a property value upgrade or to a bigger property. What’s really clear in the graph that we’ve provided is that semigrators who move to a bigger property, the percentage is really small in Western Cape. So they’re not moving to a bigger property when they semigrate to the Western Cape.
The Finance Ghost: No, definitely not. I can definitely confirm that.
Hayley Ivins-Downes: But what they are doing, is they’re getting a value upgrade.
The Finance Ghost: So this is what I’ve actually realised because people always talk about how cliquey Cape Town is and no one invites you to their home – and look, Capetonians are as flaky as can be. When you move down here, the majority of people you make friends with are ex-Joburg, ex-KZN, ex-wherever, basically, who have all moved here. That seems to be easier.
But I also think there’s a genuine reason for this. All of the standard jokes aside, it’s because people’s homes are just not big enough to have the big braais that Gautengers are so used to. You live in Gauteng in a typical middle-class area and you’ve got space for the braais, the pools, bring the kids, bring your friends. When people invite you for a braai, they actually mean it. When people say they will come to a braai, they will in fact come. Whereas in Cape Town there’s just no space. People who live in the city, it’s a complete non-starter and the ‘burbs, even the houses are much smaller than Joburg. So people do not entertain at home nearly as much as they entertain out of home. And I think it’s the property. I genuinely do believe that.
Hayley Ivins-Downes: Definitely, definitely around the size.
The Finance Ghost: It is. And the other thing that we always assume, of course, is that everyone just lives in a complex. The stats obviously tell us not and I’m keen to get some idea of those stats. But I think that also the reason we think that is because so much of the recent development we see is complexes and estates. We’re fed that all the time. I haven’t seen a ton of activity in building big new standalone houses. A lot of it is estates, etc.
So what do the stats tell us about how people are actually living? Complexes versus freestanding houses, etc.
Hayley Ivins-Downes: So if we look at complexes and freestanding, probably once again, just to bring it back so we understand the split – when we’re looking at total volume of properties, we had basically the 8.56 million total volume, of that 85% residential. Then the residential component, 80% is freehold, 13% sectional title and then 6% your estates. So that in itself is quite important just to understand what we’re seeing.
We did some numbers recently just to try and understand any stock coming online and what people are actually looking at buying. So we looked at provincial stock added since 2020 – so that’s all new properties coming in and being bought. Just to add to that, Western Cape was highest. It was basically sitting at 6.5% of additional stock that came in since 2020 and that’s clearly being driven by demand.
If we had to then look at the split between freehold, sectional title and estate, what we’re seeing, is that estates were sitting at 16% and sectional title at 31%. So if you just bear in mind the numbers that I’ve just mentioned around the actual stock component of it, you will definitely then start getting a sense that there’s quite a few more estates coming in and sectional titles coming in, in terms of developments, new properties on the market and what people are buying. So that in itself also just then speaks to what people are looking for in terms of a lifestyle or a preference. And we’re really starting to see that in the numbers and the change of that coming through.
The Finance Ghost: You made another interesting point there, actually, which is if you look at the value shift over 10 years, as in the percentage of total value, you’ve got to be quite careful as a homeowner to pat yourself on the back and go, oh, my Western Cape property has been an absolute gem because there’s a like-for-like value move, i.e. volumes hold constant, and then there’s share of total value. So if the bulk of new development has been in the Western Cape, then the Western Cape’s share of national property value would go up even if the underlying properties did not move in value, right?
Hayley Ivins-Downes: Correct. Absolutely, yeah.
The Finance Ghost: The magic of stats.
Hayley Ivins-Downes: Magic of stats. And just to be aware of that, just speaking around property values, we also looked at the average property value per province, which just speaks to everything that we’ve been saying. Where we saw the Western Cape average property value at a provincial level was R1.7 million. Compare that to Gauteng, which is just over R1 million and KZN which is just under R1 million. So it starts giving you a sense in terms of the jump up in terms of value and what we’re seeing.
And then obviously when you start breaking that further down into the different bands of property and the value bands, above your R5 million, R2.5 million to above your R5 million, the biggest portion of that is in the Western Cape, I would say probably about 25% / 28% of the properties. And the second one coming in there, interestingly enough, not Gauteng, is KZN, and KZN sitting at about 20% of their properties are sitting in those price bands. Very interesting also just to understand that as well.
The Finance Ghost: Interesting. And on a Zimbali-adjusted basis? No, I’m just kidding. But it is true though, that sometimes the specific estates do skew things. So I can tell you now in Cape Town, the number of new homes that have been built in Sunningdale is absolutely through the roof. And they are, technically speaking, freehold standalone houses, but they’re part of a bigger Garden Cities development where they all look almost exactly the same. There are strong rules, they are a complex in every way other than the boom at the start of the streets, because you don’t really need that down here like you do in Joburg. But in terms of the style of how people are living in those homes, it may as well be a complex. So that’s probably really skewing the stats actually.
That’s an important point maybe. A lot of these are macro stats and we’re talking about them because they’re interesting and they tell a story of South Africa. But when you’re doing property-level investing, and this is where the Lightstone reports are so helpful, you can buy a trend report for a suburb, you can actually just square it right down to the place you are looking.
What has this thing been doing? What are the recent average sales? What are the implied growth rates, etc? What is the value of this house in all likelihood? And that’s the true value of it. The macro stuff is very interesting, but you’ve got to be careful of stats.
My favourite quote about stats undoubtedly is about averages: “If you’re standing with one leg frozen in ice and the other leg on fire, then on average you’re fine!” But in reality, you’re not fine. So it’s always pretty important when you’re talking stats to remember that kind of stuff.
Anyway, that aside, let’s maybe go back to some of the other stuff that we can actually talk through. And I think one of the other points we definitely need to deal with is the impact of interest rates. Because while the SARB seems to basically be almost willing to sell their firstborn children before they will cut interest rates – I’m really not sure what more it takes than where we are, but be that as it may – if rates do actually come down, then it typically makes quite a difference to volumes in the industry, as any estate agent will certainly tell you, but then also the prices that can be achieved. And this is that cyclical point that I was saying, you almost need to flip around the definitions of buyers’ and sellers’ markets from an investor perspective to actually get the right deal.
But what did you see during the pandemic in terms of volumes? I mean, you mentioned it a little bit earlier. How much can you see the interest rate cycle in the numbers?
Hayley Ivins-Downes: So you can definitely see the interest rate cycle. What we saw – so, 2020, we obviously had COVID, 2021 and 2022 were really big volume years in terms of sales. So obviously speaking to your sellers, buyers, this is definitely when sellers were getting the price that they wanted and sometimes in areas that were really valued, they were getting more than they wanted, which is always a good thing.
We have obviously at that point, that was when the interest rate was at its lowest in 50 years. We then obviously started seeing the trickling back of interest rates going up. And 2023 was one of the toughest years we’ve had. The market really contracted and people then started looking at, well, if the interest rate is at this percentage and if I’m going to borrow money to buy a property, it’s going to be costing me a certain amount. And that’s when you start seeing the shift between the man on the street buying a property versus renting. Because you start doing the numbers and you start realising that when interest rates go up, it’s going to be costing me more to service my bond, my home loan, versus renting a place until the interest rate is either possibly down or I’ve saved enough money. So we’ve definitely seen the correlation. We obviously saw 2021, we saw sales of 280,000 over the year and 2024, we were down to 200,000. So quite a big drop in terms of the number of properties that had sold. And then quarter one, quarter two of 2025, we’re not even at 100,000.
I think it certainly then speaks to the fact that with interest rates not dropping fast enough, there’s always going to be questions around the affordability of actually owning a property with a bond versus renting. And it’s in these kind of instances where we see the swing in terms of sellers to buyers. Because obviously, as a seller, if you are in an area and you need to obviously move for – be it a job, be it whatever circumstance – you need to sell your property and the market is as it has been, 2023/2024, the reality is you’re not going to be getting the value that you would like to for your property.
Which means that, from a buyer’s perspective, it’s certainly in their hands that they’re going to be getting property at lower estimates in terms of market. But definitely very interesting. And it correlates very much with the interest rate. People are doing their numbers and checking out the sums.
The Finance Ghost: It’s very interesting to also see then what happens to rentals. So rates come down, bonds become more affordable. But then you have this very interesting situation where what typically happens then is the prices of properties go up because now it’s easier for you to afford, so as the seller of the property, I can now ask you for more. You don’t necessarily always just win as the buyer.
Or if I can’t find someone who’s willing to buy it at the price that I now think it’s worth, I’ll just keep ramping up the rent. And that’s where it then becomes inflationary for interest rates to come down – one of the many ways it becomes inflationary, which is what the SARB is so utterly terrified of, I think overly scared of, but I mean, it is what it is. So it’s very complex. Much as some politicians might wish it was different, we do in fact live in a free market. And that means that supply and demand does play out in property, even when it creates unsavoury outcomes and it upsets people and people get priced out of areas or into other areas.
Property is one of the very best ways to just see supply and demand in action, to see macroeconomics in action, to see the micro level stuff coming through in terms of how well a particular suburb is doing or not. This is why it fascinates me so much. I genuinely have always found residential property so interesting. Even though I personally enjoy the fact that I’m currently renting, I’m not going to rent forever. I think when you have kids and stuff, you’ve got to look through the cycle and say, financially, renting is almost certainly cheapest forever, but you also don’t want to have to move every couple of years and what happens if there isn’t a place then available near the right school, etc.
And I think that then talks directly to the age at which people become first time buyers. What have you seen in terms of – because my thesis would be that this age has moved out, I think everything is screaming that – you’ve got birth rates dropping, you’ve got lab-grown diamonds vs. mined diamonds tells you a lot about affordability of people when they’re at the age when they’re getting engaged. This all sounds so silly and anecdotal to people until you tie it all together and you ask people to just look around them, at their peer group, look at what’s happening, look at what people can afford and how they are living. It feels like a lot has changed over the last 10 years and not for the better in terms of people’s affordability.
Hayley Ivins-Downes: Definitely. We obviously, from a Lightstone perspective, track first-time home buyers as well as what we call repeat buyers, obviously people buying a property for the second or more time. And it’s always interesting for us to try and understand at what age are people actually purchasing properties. We’ve recently done some research just to understand on our data and the average age of a first-time home buyer nationally is coming in at 36 / 37 years old. A person is deciding to purchase their first home at that age, which for us is really high. If we had to go back 10, 15 years ago, it was definitely in the earlier 30s that people were looking at purchasing their first property.
It has certainly changed. A lot of that has to do with affordability and the fact that you can basically work anywhere that you would like to and you don’t need to go into the office and the fact that you can rent and there’s just so many options for people these days around where they would like to live and how they would like to live. I think that has definitely been interesting.
Saying that, we obviously then looked specifically at the Western Cape, which is always an interesting stat to look at. When we look nationally it’s kind of 36, but then in the Western Cape and this obviously speaks to the price of property, 15% of the purchases between first time and repeat buyers is happening between 36 and 49, and 18% between 18 and 35, which is interesting.
Are people buying in the Western Cape at a younger age and maybe a bit further out as an investment? What is actually – it’s actually really interesting, you can start really doing a bit of a deep dive on a lot of the stuff. Western Cape just seems to be the anomaly at the moment for our stats.
The Finance Ghost: So that’s really interesting. A lot of that could just be perception – it could be people feel safe to buy in the Western Cape because they think it’s a better investment, so they’ll buy younger?
I think a lot of it – and now this is just absolutely anecdotal speculation stuff, which by the way I really love, I think it really is something that people underrate in markets as a common-sense test – I think a lot of people who have semigrated to Cape Town have consciously done that instead of emigrating. So in other words, they’ve now said, okay, I’m going to stick it through, I’m not going to be that Springbok fan overseas who tears up every time they play the anthem. I still want to be here, I just don’t want to be in Gauteng. And they then say okay, well then I’ll buy in the Western Cape. This is the closest I’m going to get to leaving. It’s exactly what happened with me – ten years ago I had to make that call. Am I staying in South Africa? If I am staying in South Africa, where am I willing to raise a family? And the answer was not Gauteng, it was the Western Cape. And hence I semigrated. And guess what? I bought at that stage. So there we have it. It could well be a lot of that.
They buy because they feel like there’s a future in that area that they are buying in. I think enough people have been burnt or they have friends who have been burnt or they have access to information where they’ve realised you cannot be buying and then selling three years later. You’re going to lose an absolute fortune! If you’re going to buy, it’s like 10 years+. You better have a proper view on where you’re planning to be.
Hayley Ivins-Downes: Absolutely.
The Finance Ghost: Speaking of holding periods, which is maybe one of the last things we have time to talk about on this, what’s really been a very fun podcast. For there to be a buyer, there needs to be a seller. So we need these sellers out there, otherwise there’s no market. What have you observed in terms of the average holding period of these sellers before they let their properties go? So how long do they hold the properties for before they actually move on to the next one?
Hayley Ivins-Downes: So this we have found really interesting because I think this really speaks to the market and how tough it is actually for an estate agent or any kind of property practitioner. If we looked on a national level and we looked back to 2014, on average, people are living in their properties for eight years. When we did the stat for 2025, it’s nearly up to 12 years nationally. So people are actually hanging onto their houses for a lot longer than they were – speaks to activity in the market.
I think one of the areas that’s really the longest is Northern Cape – that goes up to 14 years. And then as I mentioned earlier, you get the Western Cape with its own numbers and the Western Cape – and this obviously speaks to the fact that maybe sellers can actually get property prices that are really worthwhile – and if we look at that, 2014, it was nine years that they were hanging onto property, and it’s really just gone up to about just over 10 years. So not a big difference in the Western Cape compared to what we’re seeing nationally, which is really interesting because there’s definitely been a shift to people hanging onto properties for longer. And that just speaks to a really tough market because basically it’s really hard to get stock for your estate agent or property practitioner stock to be sold. It really just speaks to that.
The Finance Ghost: Yeah, and it speaks directly to transfer duty. I still maintain if transfer duties were lower, I actually think the government would make more money because more houses would change hands more often. But instead we have this draconian transfer duty regime that means people have to hang onto their houses for longer. And then you end up with this situation. I had a little chuckle to myself when you gave that Northern Cape stat, because I suddenly just had this vision of someone living in this absolute middle of nowhere place in the Northern Cape, and they keep it for 14 years because that’s how long it takes until someone else drives past, wherever it is they happen to live, while looking at the beautiful stars!
We do live in a beautiful country with some very, very, very different provinces, all of which definitely have their pros and cons, that’s for sure.
Hayley Ivins-Downes: Yes, exactly.
The Finance Ghost: Maybe a good place to just end off with this, is actually to just talk about how people can then empower themselves using Lightstone. Because we’ve talked about clearly the importance of data-led decision making. Treat this as stocks you are buying on the market, but then also just remember that it is like the riskiest stock you’ve ever bought in your life because your concentration risk is enormous. You’re borrowing the money to buy it. Buying a house is a massive decision, you should never be making it lightly and the data is valuable.
So for people looking at homes, do they go through their agent? Do they buy from you directly? What is the right way to actually get the Lightstone data into your decision-making process?
Hayley Ivins-Downes: So it really works both ways. You can purchase the reports directly off Lightstone. We have two valuation reports available, actually, one for a buyer that gives a lot more detail around the area, possible costs that you need to understand that you’re going to be incurring if you’re buying a property. All of those components that the Ghost mentioned, things like your transfer fees, the bond costs, all of those elements.
Then we’ve got a seller valuation report which really just speaks to how much the seller would be able to get for their property, the value that they could anticipate getting in terms of market estimates. And I do think it’s really important to understand this information because if you’re dealing obviously with a couple of valuers or estate agents, it’s also good to empower yourself as a buyer or seller and know what your property market estimate is in the market. This is always an emotional time to be purchasing something like a property. Just make sure that you’ve got all the numbers and all the facts and all the data because it certainly then just helps the decision-making process to be a little bit more based on information as opposed to emotion.
The Finance Ghost: That’s exactly it in a nutshell. And really, I can’t stress this enough. If you get it wrong with overpaying for a home or your holding period doesn’t work out the way you thought, or something goes south for you, you can destroy generational wealth in a home. You really can. It’s quite hard in South Africa to create generational wealth in a home these days. It’s very easy to destroy it. We all need to live somewhere and renting versus buying is a classic decision and a hard one and there’s no one-size-fits-all answer. But I think the one-size-fits-all answer that is out there is use the data, empower yourself, get the piece of paper, point to the number. If you have a stubborn seller or whatever the case may be, you can bring them down with that number. And equally, to be honest, if you think you’re getting a bargain, go and check it against that and maybe you are getting a bargain as the buyer. Maybe you can pick this house up for way below what the estimated valuation is, in which case maybe that encourages you to get on with it and actually do the deal. Either way, having the data is valuable.
So, Hayley, I think we can probably leave it there. It’s been such a fun conversation. It’s been really, really cool. I would encourage people go and check out lightstoneproperty.co.za. It’s pretty easy. All of the products are there. You can either go for the subscription route or do it as a once off thing. It’s not “money” – it’s like 100-and-something rand to get the report. In the greater scheme of spending 2 or 3 million rand on a house, R126.50 I think is money well spent.
Hayley Ivins-Downes: Thank you Ghost and thank you to all the listeners who will be listening to this. And you know, we are available for any questions, if there are any questions. Happy to answer.
BHP had a solid quarter and is on track for guidance (JSE: BHG)
Copper, iron ore and steelmaking coal are among the highlights
BHP has released their review for the quarter ended September. Copper gets mentioned first of course, as that’s the commodity that everyone is in love with at the moment. Production increased by 4%. There are other highlights, like steelmaking coal up 8% and WAIO having a record quarter in terms of material mined, even if that didn’t lead to an increase in iron ore production due to planned maintenance.
Average realised prices were up for copper and iron ore this quarter both year-on-year and sequentially. Steelmaking coal and energy coal rose sequentially, but both were down significantly year-on-year. This is why diversification is important for mining groups.
BHP’s production guidance for FY26 is unchanged. The same is true for unit cost expectations across the board.
Metair’s investor day delivers deep insights into how the group thinks (JSE: MTA)
There are almost 100 slides to dig into!
Metair is such an interesting business. The group focuses on automotive components and has substantial exposure to the OEMs operating in South Africa. The significant disruption in the automotive industry forced them to execute a turnaround. They also decided to take a risk on the acquisition of AutoZone, which means taking a big step into aftermarket parts.
I think that it makes a lot of sense strategically, which is why this is such good story to follow if you want to learn about corporate strategy and turnarounds.
Metair hosted an investor day and made the presentation available. It includes slides like this banger about market segmentation:
Across nearly 100 slides, Metair goes into detail on the entire business. If you’re invested here, I highly recommend you check out the preso. Even if you aren’t, it’s a great example of how corporate strategists operate!
Oasis Crescent is delivering inflation protection for investors (JSE: OAS)
This is an example of how to do property without debt
Oasis Crescrent Property Fund is a Shari’ah-compliant structure, which means that the fund doesn’t make use of debt. Now, as we know from the broader property sector, debt is a feature of REITs rather than a bug. It tells you a lot about the structurally high nature of interest rates in South Africa that Oasis Crescent has managed a total return (NAV growth plus distributions) of 11.1% per annum since inception. That’s more than double inflation.
The six months to September 2025 saw a modest 2.3% increase in the NAV per unit and 5.2% growth in the distribution. So, more of the same really. The fund is incredibly illiquid, which I think is how they convince investors to reinvest distributions at NAV even though the fund is trading at a discount.
Reinet’s underlying fund NAV is trending slightly positive (JSE: RNI)
It looks like a flattish quarter
As a precursor to releasing the net asset value (NAV) per share of the holding company, Reinet releases the NAV movement in the underlying wholly-owned subsidiary, Reinet Fund. This isn’t exactly the same as the holding company, as there are balance sheet items that are outside of the fund. Still, it’s always a good indication of the direction of travel.
The NAV as at September 2025 was €38.87, just 0.85% higher than the NAV at June 2025. It was therefore a fairly flat quarter, although annualising that number would still give low single-digit growth in euros.
The Sirius Real Estate investor day gave plenty of insight into their strategy (JSE: SRE)
Buy low, sell high – and actively manage along the way
Sirius Real Estate hosted an investor day at the Hartlebury Trading Estate in the UK. They bought this property in August for £101.1 million, growing the BizSpace platform in the UK by 18% in square feet and the gross asset value by 20%.
The presentation was about the entire Sirius portfolio though. It goes into immense detail regarding the portfolio and the key metrics. There’s even a chart on the number of enquiries vs. viewings!
This is a busy slide, but that’s because Sirius is a busy company. Just look at the number of recent acquisitions vs. sales:
In the outlook statement, this comment makes it pretty clear why Sirius has been focusing on the defence sector in Germany:
“New pro-business German Government proposing an expected c. €900 billion fiscal stimulus, including c. €400bn in defence spend, over the next 10+ years”
Those defence businesses will need space and Sirius is only too happy to oblige.
South32’s quarterly update reflects unchanged production guidance for FY26 (JSE: S32)
Copper and manganese are among the highlights
South32 released the quarterly report for the period ended September. They are feeling good about the world, with a 12% increase in copper equivalent production at Sierra Gorda and a 33% uplift in manganese volumes thanks to the initiatives at Australia Manganese.
It was also a quarter of heavy investment, with net cash almost halving to $64 million as the group invested in Hermosa and experienced a temporary increase in working capital. It’s nothing unusual to see volatility in balance sheet numbers when viewed through a quarterly lens.
It’s not all roses out there of course. As a reminder, the current state of play at Mozal Aluminium is that operations will only run until March 2026. They cannot lock in an electricity supply at an economically viable price despite months of negotiations with the Mozambique government, HCB as the hydroelectric project and our very own Eskom.
Overall, with one quarter out the way thus far this financial year, their production guidance for FY26 is unchanged.
The Foschini Group had a truly horrible day (JSE: TFG)
The share price was thrown around like a rag doll
If you’re a shareholder in The Foschini Group and you haven’t looked at the market in the past day, I suggest you brace yourself. The share price closed 16.6% lower on the day. About the only happy news I can give you is that things were even worse in mid-afternoon trade, so it actually clawed back some ground heading into the close.
This takes the year-to-date share price performance to a rather spectacular drop of around 40%. It ain’t pretty:
The catalyst for the drop was the release of a trading statement for the six months to September 2025.
Before we dig into the numbers it’s important to remember to exclude White Stuff from the growth rates. This is the UK acquisition that is beyond my comprehension. I’ve written many times about the tough battles that TFG needs to fight in its home market and the risks of further distraction offshore, particularly in the context of the highly ambitious capital markets day they recently held, yet the group continues to stretch itself too thin across these markets.
Excluding White Stuff, group sales were up just 3.5%. Combined with gross margin pressure, that can only lead to a nasty drop in profits. The really bad news is the jump in finance costs of 14.5% thanks to the White Stuff deal and the extra pressure this puts on the balance sheet. This is why HEPS is expected to fall by between 20% and 25% for the six months. It’s also why the share price followed suit.
Is there a silver lining in TFG Africa? Not really, with sales up 5.3% as a disappointing outcome after a strong start to the year. Credit sales were up 7.9%, so consumer pressure remains evident as cash sales were clearly weak. Gross margin is perhaps the biggest concern, with a 100 basis points contraction in margins from winter clearance that moderated to 90 basis points by the end of the period. EBIT in South Africa fell by 9.7%, a really nasty story to have to tell in the immediate aftermath of the capital markets day.
TFG London grew sales by just 0.7% excluding White Stuff. There was much improvement in Q2 vs. Q1, but it’s still poor. White Stuff managed to grow its sales by 12.5%, so perhaps this will turn out to be a good deal after all. I just wonder if the market will have enough patience with TFG and the management team to allow that story to play out.
TFG Australia is a huge headache, with sales down 0.5% and EBIT down 18.4%. Down under appears to be the direction of travel for the business, not just its location.
Probably the only highlight in the numbers is online sales, up 55.3% at group level and now contributing 14.7% to total retail sales. This does include White Stuff though. For a cleaner view, TFG Africa online sales were up 40.2% thanks to Bash as an exciting growth engine in the group.
Tough, tough scenes for TFG and its shareholders.
Zeder impacted by valuation pressure at Zaad (JSE: ZED)
The NAV for the six months to August 2025 has dipped (after allowing for dividends)
When you look at the results of an investment holding company that is going through a value unlock strategy, you need to be extra careful. If the company has paid large dividends to shareholders, then this will naturally reduce the NAV per share. The trick is to consider the NAV movements after adjusting for any such dividends.
Zeder’s NAV per share has dropped by 47 cents per share between August 2024 and August 2025, now sitting at R1.68. A significant 31 cents of this drop is attributable to special dividends, so the remaining 16 cents is due to fair value movements.
The pressure is in Zaad, which represents 77% of Zeder’s sum-of-the-parts value. Zaad is a substantial business that focuses on agri-inputs in emerging and frontier markets across Africa, the Middle East and Eastern Europe. That’s clearly a high growth opportunity, but also a difficult business to manage. Zeder controls 97.2% of Zaad and has been following a value unlock strategy that has involved disposals of underlying subsidiaries where it makes sense to do so.
The TL;DR at Zaad is that the seed IP operations suffered a negative valuation move. This is why Zeder’s NAV per share has dipped.
The only other investment in Zeder is in Pome Investments, but the value of R65 million is tiny compared to Zaad at R2 billion.
Zeder’s sum-of-the-parts value is R1.68 per share. The share price is currently R1.26.
Nibbles:
Director dealings:
There’s been a meaty purchase of shares by a director of Sabvest Capital (JSE: SBP) worth over R14 million. The trade was effected through an off-market purchase of R11 million in shares and on-market trades for the rest.
The CFO of DRDGOLD (JSE: DRD) sold shares worth R7.5 million.
Here’s another sale in the gold sector: the CEO of Pan African Resources (JSE: PAN) sold shares in the company worth a total of over R4.4 million.
The company secretary of Hammerson (JSE: HMN) sold shares worth around R623k.
Heaven knows how these things happen in practice, but a prescribed officer of Acsion (JSE: ACS) sold shares worth R595 (yes, steak-and-wine money) without clearance to deal.
Sibanye-Stillwater (JSE: SSW) announced that the new chrome agreements with the Glencore (JSE: GLN) – Merafe (JSE: MRF) joint venture have been fulfilled. This increases Sibanye’s share of free cash flow due to higher feed and better recoveries from the Marikana Chrome Recovery Plants.
Pan African Resources (JSE: PAN) has taken the next step in adding a London Main Market listing to the story. The company will be moving up from the AIM, with the hope being to attract more international investors who typically wouldn’t invest in an AIM-listed company. There are no new shares being issued, so the release of a prospectus by the group is purely to meet the disclosure requirements.
Fortress Real Estate (JSE: FFB) shareholders are hungry for more NEPI Rockcastle (JSE: NRP) shares, with holders of 88.48% of Fortress shares electing to receive NEPI shares as a dividend in specie in lieu of cash. Notably, a number of Fortress execs (including the CEO) elected this option.
Copper 360 (JSE: CPR) is having a terrible year. The company has shed over 70% of its value year-to-date. I would normally not give much attention to non-executive director appointments, but I’ll make an exception here as Copper 360 has appointed Llewellyn Delport to the board. He has over 30 years of experience in mining and energy, with a track record in turnarounds and early-stage projects He is the former CEO of Trans Hex. His appointment will hopefully play a role in the company finding some positive momentum.
African Dawn Capital (JSE: ADW) is currently suspended from trading due to failure to publish financials for the year ended February 2025. The company hopes to distribute the financials by the end of November and the annual report by 19 December. They also need to release the interims for the six months to August, which they hope to achieve by the end of November. If they get all of this right, then they will look to have the suspension lifted.
Balwin is having a much better time of things (JSE: BWN)
Imagine what further interest rate decreases could achieve?
Balwin has been a tough story in the aftermath of the pandemic, as high interest rates really hurt demand for properties. Just take a look at this share price chart for context:
As you’ll notice on the chart though, there’s been quite a rally in the past few months. Balwin is up more than 40% over six months, rewarding those who managed to get the timing right.
The results for the six months to August justify the move, with a trading statement telling us that HEPS will be up by between 25% and 30%. The midpoint of the guided range suggests interim HEPS of 20.735 cents. If we make the dangerous assumption of annualising this number, we arrive at a forward P/E multiple of 6.6x.
Balwin isn’t dirt cheap anymore, but it’s still cheap – provided that this performance can continue and free cash flow looks good. To help with that assessment, detailed results are expected to be released on 28 October.
Another day, another Cell C presentation by Blu Label (JSE: BLU)
This brings the tally to three presentations in the past month or so
With Cell C being dressed up for its IPO, Blu Label is doing everything possible to keep the market appraised of the progress of the pre-IPO restructuring and the strategy of the company. That’s exactly what they need to do at this stage in the process, so this isn’t a surprise.
The trigger for the latest presentation is in all likelihood the Blu Label shareholder meeting that took place on Monday 20th October (the day of release of the presentation). There are many complex steps to this dance, as the web of balance sheet relationships between Blu Label’s subsidiary TPC and Cell C would make even the most ambitious spider blush.
Shareholders said yes to the dress on this one, with holders of 99.99% of shares present at the meeting voting in favour of the transaction. I think the other 0.01% of holders are probably still trying to understand the presentations.
To get involved here, investors would need to take a leap of faith. If you look at Cell C in its pre-restructuring form, growth in revenue was only 1.9% in 2024 and 2.6% in 2025. But after the adjustments for the restructuring, the pro forma 2025 number is 26.4% higher than the prior year (this isn’t an indication of maintainable growth). You’ll find a similar theme in EBITDA in terms of the adjustments to 2025 making a big difference. This limits the usefulness of historical numbers and makes the guidance that much more important, with Cell C expecting net revenue growth in the medium-term of mid-single digits and EBIT margin of mid-to-high teens. They intend to pay 30% to 50% of free cash flow as a dividend, while maintaining the balance sheet at a net debt to EBITDA ratio below 1x.
When all is said and done, the group will have gross debt to EBITDA of 1.3x. Importantly, almost half the debt is related to leases, with the rest related to financial debt.
Leases are a constant source of irritation in financials at the moment. For example, Cell C’s free cash flow conversion rate is 39.4%. That sounds unexciting for a capex-light model, but this is based on free cash flow as a percentage of EBITDA – and EBITDA doesn’t include the cost of leases, which you’ll now find on the net finance costs line. No matter how capex-light you are, you still need to pay for things like space!
Here’s the cash flow bridge that distinguishes between capex in the traditional sense and finance lease payments. It’s a good reminder that capex-light isn’t the same thing as capex-free:
Coronation’s assets under management grew nearly R100 billion in the past 12 months (JSE: CML)
Local market performance would certainly have helped here
There really are only three certainties in life: death, taxes and Coronation releasing assets under management (AUM) without giving a single comparable number in the announcement. This sends investors on a treasure hunt through SENS to find sensible numbers to give context to the latest AUM.
As at September 2025, AUM was R761 billion. In September 2024, they were at R667 billion. That’s a 14% increase in the past 12 months! The trading statement doesn’t give an indication of net flows vs. market performance, but there’s no doubt that the strength of the JSE over the past year helped them.
The HEPS move is badly skewed by the reversal of the SARS tax provision in the base period. If you exclude that, then fund management earnings per share is expected to increase by between 5% and 15%. It’s a pity that there isn’t more operating leverage in this thing, as I’m sure investors would’ve hoped for more exciting earnings growth in the context of this AUM move.
Coronation’s share price is up 22.5% year-to-date. The midpoint of HEPS guidance is around 473 cents, which puts the P/E multiple on just over 10x.
KAL group is having a strong year (JSE: KAL)
Will this bring some positive momentumto the share price?
KAL Group has released a voluntary trading update for the year ended September 2025. They plan to release detailed results on 27 November, so this update is just the hors d’oeuvre for investors.
It’s a tasty one, with the group indicating that recurring HEPS is expected to be between 7% and 13% higher for the period. When combined with a balance sheet in excellent shape (the lowest debt levels in 15 years), things are looking good.
Digging deeper reveals an acceleration across the business. The Retail channel grew trading profit by 6.4% in the second half vs. 2.1% in the first half, with better margins helping to offset some of the broader sales pressure. The Agri channel was the star of the show though, with growth of 12.2% in the second half vs. 5.2% in the first half. This was driven by better farming conditions and exports despite all the fears around tariffs. In the Fuel channel, growth in the second half was 7.7% vs. 2.8% in the first half, with better market share in farm fuel among other drivers of this performance.
This is a positive update with a strong read-through for conditions in the agri sector in South Africa.
Optasia has released the pre-listing statement (JSE: OPA)
Ethos Capital (JSE: EPE) shareholder will want to pay attention here
New listings on the JSE are such exciting things. Sure, you can already access Optasia through buying shares in Ethos Capital, but nothing beats direct exposure.
Optasia has released the pre-listing statement for an IPO that will see around R6.3 billion in value change hands, so this is a meaty transaction. Best of all, this is firmly an emerging and frontier markets story, with Optasia offering fintech services across 38 countries where levels of banking penetration remain low. They have a vast network of distribution partners and financial institutions, with Optasia operating as the platform that connects people to products like airtime credit and micro financing.
In the year ended December 2024, Optasia generated revenue of $151.2 million and had adjusted EBITDA of $75.1 million. From 2022 to 2024, they grew EBITDA at a compound annual growth rate (CAGR) of 13.1%. Things have really accelerated recently though, with EBITDA up 91.3% in the six months to June 2025! The J-curve is a beautiful thing.
The company itself will raise approximately R1.3 billion, while the other R5 billion will flow from new shareholders to the selling shareholders who will take money off the table. The selling shareholders reserve the right to increase the number of shares on offer if market demand allows it.
Up to 30.4% of the company’s shares may be on offer here at an indicative price of R15.50 to R19.00 per share. Participation in the offer is restricted to qualifying investors in South Africa, which means institutions and those who can acquire at least R1 million in shares. Before your hang your head in disappointment, remember that the shares will trade in the secondary market and hence there will be opportunities to buy shares, although the usual situation would be for the share price to start trading above the offer price. That’s the sign of a successful IPO.
If you’re keen to learn more about the listing, you’ll find everything on the IPO sectionof the website.
Sirius Real Estate’s defence strategy is on display in the latest acquisition (JSE: SRE)
This is a clever plan to participate in growth in Europe
Before you panic, Sirius Real Estate isn’t about to pivot from properties to panzers. Instead, they’ve recognised the defence sector as a clear growth area in Europe. These tenants tend to have specialist requirements, which is where the opportunity for Sirius comes in. To make sure they get it right, the group recently appointed a retired Major General.
Sirius is known for its dealmaking prowess and they’ve not wasted any time on announcing their first acquisition in this space. The target is a business park near Munich for €43.7 million, acquired on a net initial yield of 7.8%. The anchor tenant is Excelitas, which manufactures optical and photonic (light-related) solutions for the defence, aerospace, medical and industrial sectors. They occupy 72% of the park.
Knowing Sirius as we do, it’s no surprise that they will look to maximise rental from the rest of the space where there are far shorter-dated leases that create opportunities for rental uplift.
Southern Palladium looks to raise A$20 million (JSE: SDL)
The trading halt in Australia means we knew this was coming
Southern Palladium announced a trading halt in Australia last week in anticipation of the company releasing a capital raising announcement. The JSE doesn’t have an equivalent mechanism. The halt in Australia therefore serves as a warning that the announcement is coming, with the shares still able to trade on the JSE. This is just a weird regulatory issue for companies listed in both Australia and South Africa.
Southern Palladium will raise A$20 million at only a 2.7% discount to the 15-day VWAP, while also offering a share purchase plan of up to A$1 million to allow retail shareholders to participate. Bravo Southern Palladium – this is the model that I love to see!
The proceeds of the capital raise will be used to complete the Definitive Feasibility Study, the next critical milestone for this junior mining group. They will also be able to undertake near-term mine development activities with this capital.
The share purchase plan will allow shareholders to each subscribe for up to A$30k in shares. As for the rest of the raise, the company has achieved support from the largest existing shareholder and three new global institutional investors. It’s lovely to see this show of faith in the South African mining industry!
Spear is delivering on its mid-single digits promise (JSE: SEA)
For investors looking for yield and inflation protection, this is the kind of property fund that is appealing
Spear REIT is focused exclusively on the Western Cape, which means that the fund holds a solid portfolio of properties in the most stable province in the country from an investment perspective.
This means that investors are happy to pay up for the exposure, with Spear currently trading at around R11.15 vs. the net asset value (NAV) per share of R12.10. That’s a discount of only 8%, which is really light by property fund standards.
Spear’s guidance for the year is to grow distributable income per share by between 4% and 6%. The interim period is well within that range, with growth of 5.2%. Spear targets a payout ratio of 95%. If the payout ratio stays constant, then growth in the dividend per share will be in line with growth in distributable income per share.
It’s always very important to look at growth on a per-share basis, particularly when a property fund has been active with acquisitions. Although total distributable income is up nearly 56%, the number of net shares in issue is up 23.5%. The fund is much bigger than before, but it also needs to be divided into many more slices.
The balance sheet is in astonishingly good health, with the loan-to-value LTV ratio at just 13.85% vs. 27.09% as at the end of FY25. Most property funds run at 35% to 40%, so this is well below the average. Debt shouldn’t be seen in a negative light in the context of property funds. The idea is to be in a target range that optimises for financial risk vs. return on equity. There are at least three major acquisitions being implemented by Spear at the moment, so the LTV won’t stay down there (and nor should it).
A major driver of return on equity is the yield on which Spear can acquire more properties. Acquisitions during this period totaled R1.07 billion with an average acquisition yield of 9.54%. Debt funding is hard to come by in South Africa at lower rates than this, which is why capital growth is an important component of returns. The Western Cape positioning of Spear has been useful in this regard.
Looking deeper into the portfolio, it’s no surprise that the industrial and retail properties continue to enjoy strong demand. The commercial portfolio is the most interesting one to track, as there’s constant discussion in the market around the steady-state performance for office property and where demand will settle. A driver of growth that seems to be specific to Cape Town office property is the demand by international companies in the business process outsourcing and other sectors.
Overall, Spear remains a consistent and solid performer.
Nibbles:
Barloworld (JSE: BAW) announced that the offeror is up to a 62.2% stake in the company. Together with concert and related parties, the stake is up to 85.5%. Will they get high enough to invoke a squeeze-out and end up with 100% in Barloworld?
Metrofile (JSE: MFL) is running late with the circular related to the firm intention announcement that went out on 17 September. This does happen in the market from time to time. The TRP has granted an extension to Friday 24 October, so they need to get it out this week.
Copper 360 (JSE: CPR) renewed the cautionary announcement related to planned capital raising activity. The circular for the claw-back offer and rights offer is waiting for the sign-off by the JSE of the fairness opinions prepared by the independent expert in respect of small related party transactions. The share price is down by more than 70% this year!
I don’t often comment on non-executive director appointments, but my eyebrows were certainly raised by Nedbank (JSE: NED) announcing that ex-Sasol (JSE: SOL) CEO Fleetwood Grobler would be appointed as an independent non-executive director and member of the Nedbank Sustainability and Climate Resilience Committee. If guess if anyone understands how to deal with environmental activism and target setting, it’s a Sasol exec!
Wesizwe Platinum (JSE: WEZ) may have caught up on the financials for the year ended December 2024, but they still need to get the interims for the six months to June 2025 done. This is why the listing is still suspended at this stage.
AI has dominated the headlines this year and is the cause of seemingly bottomless investment in markets like the US. This is technology theatre at its finest, accompanied by flashy presentations and even flashier share prices at the world’s biggest tech companies.
But what impact is it actually having on the corporates on the ground who are the eventual users of the service?
To unpack where AI works (and doesn’t) in the real world, Shane Cooper (Head of Digital Advisory at Forvis Mazars in South Africa) joined me for a frank discussion. We covered a number of topics including:
AI as the “smartphone moment” of this tech era
The key considerations for executives in AI implementations
Global and local examples of AI implementations in companies like Zeiss, Sasol, Siemens, Walmart and Shoprite
How SMEs are viewing and applying the AI opportunities
Disruption to the internet economy as we know it
Why AI is still “hallucinating” answers to questions
The near-existential questions that AI poses for humanity
How to think about your job in the context of AI’s strengths and limitations
Buckle up. This is a powerful discussion about probably the most important business topic in the world today. You can connect with Shane on LinkedIn here.
Listen to the podcast here:
Transcript:
The Finance Ghost Welcome to this episode of the Ghost Stories podcast. We’re recording this after there’s been a lot of news flow in the market around AI, although it feels like I could probably say that every single week.
We’ve seen some really big deals between the likes of Nvidia and OpenAI and AMD, and lots that investors have been looking at. And we keep reading about this stuff – we keep reading about AI. It’s everywhere at the moment. I think at this point, if you haven’t at least tried out some kind of LLM, you probably are at serious risk of making yourself redundant in a world where it’s going to be hard even for those who do actually put in the effort to equip themselves with AI knowledge. Please don’t be the VCR in a world of CDs and then DVDs and then streaming – gotta stay on top of these things.
And to help us understand what is actually going on out there in this world, we have Shane Cooper. He’s the head of Digital Advisory at Forvis Mazars in South Africa. Shane and I have not done a podcast before together, so this is Shane’s first time on the show, and I’m very excited to have him here with me today and we’re going to talk about how companies are thinking about this new world and what’s actually going on out there.
Shane, one of the terms that came up is “technological theatre” – what a thing! I love that. I guess today we’re going to understand a little bit more about this big theatre production and especially what it could actually lead to and what the useful things will be. Thank you for your time on the show.
Shane Cooper: Thank you, Ghost, for inviting me and it’s a great pleasure. I’m sure we’re going to be covering a number of critical issues today with your audience.
The Finance Ghost: Yeah, absolutely. I mean, this stuff is literally everywhere. As I said, it really is incredibly important.
I’m keen to understand a couple of things – I guess one is more your background and how you got into doing the digital stuff. That’s always interesting. But then on top of that, why digital advisory services are actually such a natural fit at Forvis Mazars, why this is part of your service portfolio?
Maybe let’s do some of the setting the scene here, a little bit about your involvement, but then also why this makes sense at Forvis Mazars in South Africa.
Shane Cooper: Perfect. It probably doesn’t feel natural for an accountant to be talking about tech. I’m an accountant by trade, but when I finished my articles in the early part of the century, I moved into tech pretty much immediately. So I’ve been in tech for 20, 25 years – the last 10 years been part of the Vodacom Group, led strategy there for half a decade, and then was part of one of their startups in the Internet of Things space for the last five years.
And during my time there, what I began to understand is just how organisations are battling to deal with generating value out of data. But coupled with that, we have this emergence of what I guess you could call the consumer version of AI with the launch of ChatGPT – what is it now, well over two years ago? And I think for the very first time we’ve had a significant form of technology find its way to consumers first. We’re now in a position where organisations are looking to embrace it and find ways to get value out of it. And you’re right, the “tech theatre” that you referenced at the beginning of the podcast is exactly where we are.
I mean, I’d love to talk about things like whether we’re going through a period of significant hype or whether there is a bubble, I’ve got some firm views on that.
But tech for 25 years, there is no debate that at the minute the most interesting part of technology around the world today is Artificial Intelligence.
The Finance Ghost: It feels like the biggest thing since the smartphone. I always think about the iPhone and the iPhone came out in 2007 – I was at university, I remember, and it was only the very rich kids at varsity who managed to get one or two of these things from overseas. It was quite a big deal. The rest of us were on Blackberries with broken keypads trying to BBM each other. Those were the days!
And things change, things change really quickly. I mean, just look at what’s happened in not even two decades since the iPhone came out. It feels like AI is that next big push.
And you can’t tease me like that on your views on the bubble without me asking you then, is this technological theatre going to be comedy or tragedy? How’s it going to end for investors? Or is it going to be a little bit of both? Because it feels very much like comedy at the moment when I look at what’s going on out there.
Shane Cooper: Yeah, it’s fascinating. I mean, you referenced the OpenAI investment in AMD and the Nvidia investment in OpenAI. So you have a circular reference where cash is simply moving from one organisation to the other.
The Finance Ghost: It’s that Spiderman meme where they’re all pointing at each other. All of them are Spidermans.
Shane Cooper: Exactly! And you have OpenAI having a conversation with AMD saying, well, how do we fund this? Well, all that OpenAI needs to do is mention AMD in the media and AMD’s share price is going to rise. There we go – you’ve got your funding for the acquisitions.
The Finance Ghost: Ta da! It’s amazing, right? It’s ridiculous.
Shane Cooper: Exactly! I don’t think there’s a debate that there is a bubble and absolutely there are going to be fingers burnt for sure. But I think the broader question is if you – and you referenced the smartphone moment with Apple, I think it’s probably a bit bigger than that. I think probably the more likely equivalence is either the internet era or even more seriously the invention of electricity and the railroads. We all know that the story about railroads, there was a huge investment, there was a bubble there and there were some fingers burnt during that process. But at least the rails were put down. You could argue now the data centres that are being deployed is useful infrastructure for future use anyway. I think the challenge here though is that the depreciation cycles for data centres are far shorter than they were for railroads. So that’s the challenge we sit in.
For sure there is hype. For sure there is a bubble. But is there value in the use of AI? Absolutely! And this is where I think the conversation today is useful in how organisations should be thinking about AI to bring benefit to the organization.
The Finance Ghost: I love the railroad analogy because it is the exact right one I think – it is about building out this infrastructure. But some important differences which you’ve also highlighted there around depreciation cycles, etc. Also, railroads didn’t constantly need energy just to exist. I think that’s a big question mark around data centres. Every time AI gives me a stupid answer, I feel extra irritated by the fact that energy was used to actually go and waste my time with this nonsense.
Shane Cooper: Energy. Water.
The Finance Ghost: All these things.
Shane Cooper: Yeah.
The Finance Ghost: But anyway, this is part of technological progress for us. The funny thing is, if you go back and watch like a sci-fi movie from 30 or 40 years ago and then their idea of “The Future” – the future is inevitably somewhere in the 2030s. I don’t know why that seemed to just grab their attention. Maybe it was, well, what will we be doing in 50 years? People jumping through black holes into deep space, I’m just trying to get AI to actually read a document and give me a correct number here in 2025!
It feels like we are behind where sci-fi would like us to be. And unfortunately there’s going to be a lot of growing pains with that. It means we need to invest in this stuff and we need to see where it all lands. It’s growing pains, right? There are going to be fingers burnt. I completely agree with you.
I think the value of this discussion is understanding what is actually going on at ground level because that’s the test of whether or not this is real. I pretty much ignore – obviously all the listed companies at this point in time, it’s the “turkey voting for Christmas” issue. They’re going to tell you that this is just going to keep going, that demand is enormous.
For listeners, if you really want to go and see the hype cycle play out, just go and look at Oracle and go and look at some of the targets recently put out by them. They’ve got a big investor day in Vegas – of course, where else? – where they will be giving all these extra targets to show how insane the growth is.
Be that as it may, I think you can bring a fantastic view here of what is really going on out there from a client perspective. Let’s move into that because real-life case studies, good examples of where this stuff is actually being done out there as a digital transformation – that’s always valuable. I’ve seen it a lot in the retail space, obviously – eCommerce, omnichannel, big data that comes through there. And it’s easy for us to understand as people because we are customers of retailers who have invested in this stuff. So that’s an easy example, I suppose, but there will be lots of other ones. So let me open the floor to you, to just take us through some really good examples of where AI is actually being used in practice.
Shane Cooper: So I think, Ghost, what is important for me is let me just set the scene quickly around why I’m at Forvis Mazars and what we’re doing, because I think that’s part of what will add more context when we deal with the use cases being deployed in practice today.
So for us as Forvis Mazars, we know that digital transformation – and we’ll talk a little bit about what digital transformation means – is essential in today’s world for organisations to understand and to embrace in order to remain relevant and competitive. Now for Forvis Mazars, we (together with some of the other larger audit firms) built our brands over decades on one fundamental principle, and that’s trust. It’s a highly regulated environment and for us, we obviously have to provide an opinion on financial statements, for which investors and shareholders place confidence in those numbers in order to make the right decisions.
In order to arrive at providing that opinion, we need to have an intimate understanding of the customer. It’s not just a superficial assessment of numbers on the income statement and balance sheet, but rather a deeper understanding of how an organisation functions and in particular the decision-making process that drives performance.
Now when you overlay that in today’s world of technology with Artificial Intelligence, this understanding for us on the levers that one can pull in an organisation is pure gold when you approach AI implementations, because we’re seeing this “tech theatre” play out where shiny tools are deployed and then you have executives, shareholders and board members disappointed by ultimately the outcome of those AI implementations.
Where we focus is on ensuring that the right strategy is in place, that the right value pools are targeted. And then I think very importantly, as you implement the AI solutions, you keep track of how the metrics that you’ve targeted are changing. Because if you’re not changing metrics, then you’re simply wasting your time and you’re simply enjoying a bit of theatre.
If I use that as a preface, I’ll jump into giving a few examples of where AI in particular over the last two years – because let’s remember AI has been around for decades and even if you look at AI in terms of the various elements thereof on Gartner’s maturity curve, you’ll see something like computer vision sitting on the far right-hand side of its maturity because that’s been deployed in particular over the last five years comfortably across organisations around the world. And then more recently you have the LLMs, which is where a lot of the focus is today and moving into agentic AI.
Let’s use a few examples. None of these are Forvis Mazars customers, I thought I’d keep it a little bit generic just to give a sense of how AI is being deployed around the world.
The first one, maybe a little bit close to my heart as I’m an amateur photographer, if you look at Zeiss, the lens manufacturer, they’ve deployed AI-powered inspection systems in 2023 already. And these deployments, all that they’re designed to do is to detect issues with products that they’ve manufactured. The reason why AI is deployed there is because you’re producing tens of thousands of products on an hourly basis, there’s no chance a human QA process can solve that. Historically, QA processes used to be on a sample basis, whereas now you do 100% checks with AI. They’ve trained their engines over years of providing it with images of products that are defective and they simply apply that and an alarm will go off and a product will be removed from the proverbial conveyor belt when there’s an issue that’s been detected. That allows for a significant improvement in the quality of the products that eventually roll off their production facilities.
In South Africa, a little bit closer to home, if we look at one of our investment topic favourites – Sasol. They’ve had an interesting deployment there and I’m mentioned them specifically in that they actually haven’t spent a whole lot of money on AI for automating the process of extracting information from emails. Now, I mention that because it’s a simple use case and it’s a problem that, if you think about emails been around for many decades, it still hasn’t moved on much. Information flows via email can sometimes be hugely problematic because you’re not picking up all of the required information that you need and there’s zero automation in the email process. So they’ve deployed an interesting project. This was actually driven by some champions inside of the business, where when they deal with the extraction of metadata from suppliers, they’re able to immediately identify where there’s missing information and an automated email gets sent back to say, we’re missing information. Now, ordinarily you would have probably hours of human intervention there to assess this, very often missing things, and a simple application of AI technology solves that.
Let’s move on a little bit, maybe back to Europe. Siemens, as an engineering firm, have developed what they call their MindConnect AI platform. They’ve actually deployed this across 50 of their facilities in 2024. And what they’ve done is they’ve moved on from prediction of equipment failure to optimising production lines in real time. Can only do that with AI!
Essentially what the engine has done over the years of its deployment is that it’s understood what are the attributes that eventually lead to equipment failure and how do we pre-empt this by employing various practices during the course of the maintenance process. And what this has done for them is they’ve seen some remarkable improvements in their efficiencies of their operation because they don’t have the typical stoppages of production facilities that one finds in highly mechanical production environments. If we move on, you mentioned retail a little bit earlier. There are two names in the retail space that one should always talk about. And I’m not going to talk about Amazon in this, I’m talking about Walmart and then Shoprite, seeing as Walmart may make its presence known in South Africa in the next year or so.
Walmart are an extremely forward-thinking organisation from a tech point of view. They’ve deployed technology with their partner Wiliot across about a thousand stores in 2024 and they’re using ambient IoT sensors which track every product from warehouse to checkout. And that’s interesting because now it’s a combination of using AI and edge technology to significantly improve inventory management. Many retailers in South Africa battle with inventory management. This is the holy grail – to understand what product needs to be placed on which shelf, where, when in order to optimise your working capital. And also it’s helping Walmart in optimising their store layouts in real time. So a really cool use case.
Closer to home, Shoprite – they’re obviously a bit of the darling of the retail space in South Africa and with their loyalty programme, I think the stats are that they process somewhere around 3,000 card swipes a minute on their loyalty programme. This is a huge source of amazing data for use in their technology hub. I understand that they’ve developed some pretty sophisticated AI and analytics tools to optimise stock levels, also to provide personalised offers which is really important in our – as a sample of one, I know when I log on to my Sixty60, I always have personalised offers based on my buying patterns.
The Finance Ghost: Shane, you’ve touched on a lot of really important points there, one of which obviously being the importance of just tracking metrics in these projects, just to take you right back to the preface to that discussion about some of those real-world case studies. I think that’s very important because we’re kind of in a theme at the moment of people are not quite sure what this tech will do and they’re throwing money at it. You’re given some really good real-world use cases there that make a lot of sense.
Stuff like quality assurance, taking out errors, taking out that human element, I mean that makes sense – people are not great at having a 100% rate of no errors. That’s what we’re bad at. So that’s precisely where we should be using stuff like AI to actually get involved.
I also enjoyed your reference to amateur photography. Adobe is one of the companies that I’ve been following closely. I mean they were the poster child for transitioning into Software-as-a-Service from way back in the day where you’d go to a store and buy your software off the shelf, then you’d start paying a monthly subscription. Adobe was one of the first that took us there and they did incredibly well as a result. But now their share price is really struggling because there’s so much uncertainty over: what does it mean for the creative industry with these AI tools? What does it mean for Adobe? To what extent do people really need Adobe?
Disruption is the thing that just keeps happening, right? That’s how it works in the world of tech and what you’ve referenced there is a lot of large organisations investing in what is essentially disruptive technology, but it’s also in many cases to protect their market share, to protect their leading positions.
Sometimes with smaller companies and challenger brands, the AI actually becomes a really good way to carve out a new market position. Suddenly you’ll see a new business emerge and maybe you’ll also see SMEs that can suddenly compete with the big guns because they actually have access to a system rather than needing an army of people.
I guess that leads into a conversation around the extent to which you are seeing AI implementations in smaller companies. I’m loathe to say small companies because I think most small companies are happy to just plug something into Copilot. Perhaps I’m wrong? Happy to be corrected if I’m wrong there. But certainly as you get into medium-sized enterprises, what are the sort of AI deployments that you’re actually seeing out there?
Shane Cooper: Yeah, I think that’s a good point. I think what we should all remember is that just over two years ago when ChatGPT arrived, it was almost a “where were you when” moment when you first discovered ChatGPT. For some of us in the tech space, it was that profound a moment. Now if you think about small- to medium-business owners, they in their personal capacity would have understood the power of the technology at their fingertips. And I’m for sure clear on the fact that those business owners would have thought about how best to use this technology for their businesses.
That’s what I mentioned earlier on, that you have this consumerisation of technology that now larger corporates are beginning to understand. And corporate friction in the large organisations is a thing. Deploying new technologies into large corporates is a challenge because there are a host of things that one needs to deal with – whether you’re talking about regulatory compliance or policy restrictions, and of course the good old fashioned change management – how is AI going to impact my job? Which we can talk about a little bit later.
In the small-to medium-space, you mentioned Copilot as a technology that organisations are using. And I wouldn’t disparage that. I think there is a powerful set of use cases that one can use Copilot for. Of course, what one has to be aware of, is that if you’re not careful with how you use it, you do run the risk of your data being exposed. Understanding when to use it and how best to use it is critical. I think for small-to-medium organisations, you do need to think about how you engage those organizations to embrace a more secure access to LLMs in order to protect your business.
But I mean, just on some of the use cases, if you think about the typical series of activities that various departments undertake on a day-to-day basis, there is a lot of repetitive activity that one can now use AI for. We’re all familiar with the use of robotic process automation, and now the application of agentic AI inside of the LLM space allows you to execute what we may be a little bit disparagingly referred to as mundane tasks that you can execute on an automatic basis. Whether it is the generation of invoices, whether it is the issuance of POs, whether it’s doing basic reconciliations of your bank account into your financial records – all of that stuff can now be done via a robot. And for us, what we see in this space is that what this does is it frees up the time to do better work around properly interrogating your information and making better data-driven decisions.
The Finance Ghost: This term “agentic AI” has come up a couple of times and I think there are so many fancy terms in this “technology theatre” that I am loathe sometimes to assume that people know what it is. So maybe just because it’s come up a couple of times, can you just give us the TL;DR on what “agentic AI” actually is?
Shane Cooper: So “agentic AI” is in the first word, it’s agentic, so it’s an agent. Essentially what you’re doing is you’re creating an agent to conduct an activity that you’ve instructed it to do. Whether it is to fetch an email, analyse it, understand it, give it context and respond to the email. That could be one agent. And then what you do is you stitch various agents together to fulfil on a task end-to-end. What I think is important just to make sure that if someone does want to embrace this, I do encourage you to insert a human in the loop element there, where there’s some review. As we know, AI does tend to hallucinate and I think that’s important to understand. We’re all hoping that hallucination will decrease over time, because from what we understand over the last few weeks, the designers and builders of these LLMs have now finally understood why hallucination happens.
The Finance Ghost: Well, that is exciting, because then we can stop getting such nonsensical answers from time to time. I don’t quite remember exactly where I was when ChatGPT came out, but I know that I was “navigating the landscape” of a whole lot of articles that suddenly had the same starting sentence. So I think that was when it became apparent to me that everyone was starting to use this thing, which as a writer is just very painful to get through. But it is what it is
I enjoy the concept of stitching agents together. This sounds a lot like The Matrix, which also had a human in the loop at some point. So this feels like the world we’re going to, just go watch a bit of sci-fi and you’ll get there.
Jokes aside, the thing that worries me, and I think that worries a lot of people, is what is going to be the real impact on employment here? Because it is lovely to think that humans are all going to be way more efficient and we’re going to do these fantastic things, but it’s also not the case that we’re just going to flick a switch and suddenly say, oh well, we can do everything we do as a species now, but we can do it with half the number of humans. The other half are still there. They still need to be gainfully employed, they still need to earn an income, they still need to do something. And I think this is the ethical discussion that is honestly only just warming up. I don’t think we’re anywhere close to understanding where that might actually end up and what it might do.
I’ll tell you my theory and then you can tell me yours. My theory is that if your job has an exact right answer, then you’re in trouble. So if you don’t have to make a lot of judgement calls, if you don’t operate in the grey, if the answer is white or black, the answer is 1 or 100, then at some point there is a very good chance that something is going to be trained to get there which doesn’t make mistakes and doesn’t have off days and doesn’t take leave and doesn’t get sick. So for you to justify all of those things that make us human, you’ve got to bring a lot of judgement to the table. You’ve got to operate in areas that are grey, because that’s very hard to train machines to do.
That’s my theory at least. I’m keen to hear yours and your thoughts on the broader impact, just on employment, I guess, and how jobs will change.
Shane Cooper: Ghost, spot on! And if you add a little bit more nuance to what you’ve said around the reference to a job being black or white, if you were to think about it in sort of AI terms, around deterministic and probabilistic, if your job is deterministic, where you have a very particular outcome, for sure your role is at risk. And that applies, for example, to environments that are highly regulated. If you think about a lawyer, although we have heard some very interesting cases around AI being used in the legal space to the rather embarrassing outcome where the judge finds out that case reference that you’ve used is completely fake and made up. That’s happened quite a few times.
The Finance Ghost: Yeah, no hallucinating in court! Don’t be doing that with your AI.
Shane Cooper: These conversations are happening today and I do think that the world is going through a crisis, if not necessarily evident to many people, and I do think we should precipitate crisis conversations around AI. If you listen to someone like Dario Amadei who is the CEO of Anthropic, remember he was part of the team that was initially at OpenAI and he broke away. His view is that more than 50% of jobs are going to be affected by AI. In fact, he said more recently that he expects that the bottom rung of employment is going to fall away within the next five years. Now, essentially what he’s saying is that entry-level jobs, whether they are deterministic or not, could be taken up by Artificial Intelligence.
The Finance Ghost: Because, sorry Shane, the problem there is the entry-level job doesn’t have enough probabilistic elements, right? Because people don’t have the experience to operate in the grey. The judgment calls they need to make are not that advanced, right? That’s the issue. That’s what scares me.
Shane Cooper: And that’s why I say it’s more nuanced. If you consider that an LLM today is probabilistic, you can ask it the same question five times and more than likely you’re going to get five different answers. They may be all correct, it’s just the way that the answer is given.
That could be a junior role in an organisation where you’ve joined a legal firm, you’ve joined a consulting practice, you’ve joined a journalism job, and your first year or two or three of activities are relatively, let’s say, simple in the context of your longer journey. Those simpler tasks can be undertaken by a probabilistic LLM. Because the view today is that an LLM is essentially a student, potentially with an honours degree coming out of university.
If one was to talk about the age of LLM, it’s not quite the doctorate student yet, the view is, but it’s a collection of very intelligent honours students.
The Finance Ghost: Hallucinations included, sometimes depending on how their year went at varsity.
Shane Cooper: Absolutely, hallucinations included. And I think that’s what we should remember is that hallucinations are simply errors made by the LLM. And part of the reason for this, is that LLM’s are trained to give a confident outcome. They’re not trained to determine whether something is right or wrong. So they get rewarded if the answer is confident during the training process. Mostly it’s around accuracy, but it’s also about confidence.
The Finance Ghost: That explains a lot about some of the bad answers I’ve been given. The AI never says, well, I’m not sure, but maybe, which is actually what a grad would say.
Shane Cooper: Yeah.
The Finance Ghost: The AI says, oh, it’s definitely this. Absolutely.
Shane Cooper: For sure! And that’s why when people talk about the risk of hallucination in the corporate world, my answer to that is, well, you would review a junior’s work, wouldn’t you?
Assume that for now you have the power of as many juniors as you would like. Just make sure you review the work before you submit it. Over time, as these LLMs learn, just as people do, the margin of error will decrease.
Coming back to the question of the risk on jobs, I do think that we’re moving into a world where there should be huge concern around the impact on jobs. If you listen to, and as a journalist, you’d probably have noticed that the tone of the last year, and potentially more the last six months from CEOs around the world, is that they’re far more comfortable in talking about the fact that jobs are going to be lost to AI than they were before. There was always a reluctance to talk about the risk of jobs being lost. But we are now for sure moving into a space where decisions around hiring for someone who has resigned, there’s a pause that says, right, let’s just see first whether the AI can fulfil the job. So I do think that over the next three or four years we are going to have a fundamental shift in how the job market looks.
Now coming to the point around the benefits of AI and what that can bring to bear in society, is that if we do see a significant uplift in global GDP and the benefits that AI has promised come to fruition, what does broader society and policy makers, what decisions do they make around the concentration of revenues into these larger corporates, these owners of the LLMs, in terms of the broader dissemination of wealth? Because you now have people who are able to do a week’s worth of work in three days, do we go down to a three-day work week? Do we have universal basic income? Because think about it, the AI tools that we deploy are not free. You have to pay someone, largely in the US given that there’s a concentration of the frontier models in the US.
Then there’s the broader debate which we probably have a separate discussion on, which is the slow death of the internet economy. I’m convinced that the internet economy is probably going to die in the next two years. The whole ad generation and sharing of revenue that Google led the path on many, many, many, many years ago – AI is changing that. I think there’s a huge question to be asked around policy making and how people today, who are in the workspace, take a very, very clear view on how their role can be impacted by AI and what they can do to ensure that they don’t become a victim.
The Finance Ghost: Yeah, Shane, there’s so many fantastic points in there. I mean, we could probably do another entire podcast or two on just all of the debates around this stuff. So universal basic income – the problem there, right, and you said it is so much of the value from AI is going to flow into the US because that’s where these companies sit, but the people who are impacted by it are sitting everywhere else in the world. And you can be very sure that the likes of Microsoft, etc. are definitely not going to pay a universal basic income back to the people who lost their jobs because of a model built in the US.
There’s a lot of stuff coming down the road which is not pretty. That’s my view, which is not good. I’m equally bearish on Google’s ad revenue business. I must be honest. I wonder how we then end up in a world where there’s actually motivation for people to have niche websites to create this kind of content that were previously supported by Google Ads. Because the AI still needs to go and read something, otherwise how will we ever know what is real or not? I mean, it’s proper sci-fi stuff at the end of the day.
Shane Cooper: I was just going to say: scarcity creates the value exchange. So if there is a point at which content creators no longer feel that they’re getting what they should be receiving, they’re going to stop producing content, they’re going to go somewhere else. That’ll create a vacuum and eventually an economy is going to be created elsewhere. But for sure the disruption that Google is doing to themselves as well as, in particular ChatGPT is doing to the internet economy, is real. I think we’re going to see some real pain for people who generate their revenues from ads on the internet over the next year or so.
The Finance Ghost: If we are lucky and maybe just talking selfishly now because my model has never been clickbait and a lot of other platforms out there are very clickbaity because they just get rewarded for the number of people who arrive and so they write accordingly, etc. If we get away from an internet adverts world, then we also get away from clickbait. We get back to maybe having fewer voices who are credible and then who attract brand partnerships that support that voice and platform and want to get to that audience as per this precise partnership with Forvis Mazars.
So it’s interesting, that’s how this stuff plays out. The other thing I just wanted to touch on before we bring this home, was you mentioned “journalist” earlier and that’s a big part of what I do. But it’s just there’s an important lesson in there actually for people thinking about, well from a career perspective, how are they going to navigate this stuff. I’m also a CA by background. I did my years in banking and now I get to do this for a living, which is fantastic. But I’ve been able to do it because I’ve had to go and learn how to at times look like a journalist to the outside world, managing the website, doing all of that myself, etc. You have to learn how to sell. You have to learn so many different skills and I think that’s going to be the trick. If you’re just sitting there in university right now and you’re saying, well, I’m going to be the greatest XYZ type of lawyer or doctor or accountant or whatever in the world and I’m going to just hyper-specialise – you are looking for serious trouble, I think. Personally, I mean none of us know, but I think you have to get very good at something and then go broad after that. You definitely can’t just go extremely good at something and then sit and say, well that’s it, now I’m safe. That’s just not the world we’re in anymore. You’re going to have to pick a skill to get really strong at and then you’re going to have to learn a whole bunch of other things just to make sure that you are not replaceable by one model or one prompt or one system.
It’s hard. It’s not easy. I’m very glad my kids are too small right now to be impacted by this. By the time they get to university, we’ll know how this panned out. I’m grateful to not have kids going out of high school right now looking for advice because I wouldn’t know what to tell them. I’ll be honest, I really wouldn’t know what to tell them.
Shane Cooper: Yeah, it’s a very difficult situation to be in. If we were to look at the future by seeing what happened historically, the fact is the internet world that gave birth in the latter part of the 80s, early 90s, did give rise to a number of new kinds of jobs and work. So I would imagine the maturity of AI will also give life to a whole host of jobs we would never have guessed today.
I don’t think it’s all doom and gloom. But I do think that given the philosophical prescience of sci-fi authors, we are beginning to reach a point where we wonder about the future of humanity. I mean, isn’t it insane that we can sit here today and talk about how some of the original founders of these large language models inside of Google are talking about the risk that this technology has for humanity? Now, if you just use that as a proxy for the power of the technology and the impact that it could have on our lives, even if we were to assume humanity continues to exist, we do have real existential questions to ask ourselves about what is the meaning of this all and how do we continue to eke out an existence into the future?
So I think if you are a parent with teenagers, the anxiety is real, for sure. For me, ultimately the hope is that people still like to engage with people. In the business of dealing with buying and selling, people still buy from people. My view is that provided you’re a well-rounded human being and you can engage well and you can distill and synthesise information and articulate well with people, you should be okay. But that doesn’t mean that you shouldn’t be asking yourself some critical questions about how this technology can impact you in your life.
The Finance Ghost: Yeah, absolutely. Just a really good example of a career or line of income that’s come through recently and where I think the model could go, is something like YouTube. Being a YouTuber is an actual thing. People use this to disintermediate traditional media to get a message out there. And people love YouTube! I’m consuming more and more YouTube all the time about niche stuff, like hobby stuff and whatever, because you can just find anything you need, anything you’re interested in is on there. And then you find creators who are thought leaders in a specific niche and they get rewarded accordingly, which I think is fantastic, it’s a good example of where the internet economy still works. I think YouTube is by a country mile Google’s most impressive long-term, wide-moat kind of business. We’ll see how that plays out.
I guess to start to bring this home, Shane, and maybe just bringing it back to business stuff and I’m glad that we could talk so much about the human side of AI because too often that just gets brushed under the carpet actually as people talk about the business application. And the reality is that as a business owner you also can’t sit back and say, well you know, I hate all this and I’m not interested and I’m not getting involved because you’re kind of going to create your own downfall. I think that’s the unfortunate reality. Can’t ignore this stuff, just can’t.
So if you wanted to leave listeners, I guess, with one essential message about AI and business strategy, something that might get them to open a conversation with you to try and understand more about what the team in Forvis Mazars could assist them with, but even just outside of that, what is that essential message around this stuff?
Shane Cooper: Maybe just before I give the formal close on this, is that you’re absolutely right – organisations cannot ignore this. I would prefer that organisations, if they decide not to embrace AI, at least make an informed decision about it. Understand how it’s going to impact your life. If your decision is not to embrace it, at least make it an informed decision. I think that when organisations are considering their future use of AI, they mustn’t think of it as a technology project. It has to be for me, a board-driven transformation aspect of the business. It has to include how it impacts the organisation in its entirety. And please do not let this be the preserve of your technology department or your CFO department. This has to be something that’s embraced by the organisation in full. And I often refer to the principle of vertical and horizontal deployments of AI. Just make sure that when you are embarking on an AI project, pick the value pools that are meaningful. Where are the biggest levers in your business that you wish to either improve or protect? And work hard to understand how AI can impact that environment because then at the very least, you’re clear that you’re building a shield against that competitor who arrives out of your blind spot that you didn’t expect, who’s embraced this technology and looking to make a difference in the industry.
The Finance Ghost: Shane, I love that and I think there’s been a ton of really great insights here, so thank you. It’s been fascinating to speak to you. I’ve really genuinely enjoyed it.
And to listeners, if they’d like to connect with you, I imagine LinkedIn will work. Should they just ask their LLM how to get hold of you and the LLM will hallucinate some kind of incredible answer about your phone number or what is the correct way to find you?
Shane Cooper: They can find me on LinkedIn, it’s Shane Cooper. Or they can find me on the Forvis Mazars website. Name.surname@forvismazars.com if you want to drop me a line.
The Finance Ghost: Cool. Shane, thank you so much. Really interesting times for all of us. And to the listeners, I’d welcome your views here. What do you think about this whole AI world? What do you think is going to happen in the future and how are you using it in business? That’s also fascinating feedback.
So, Shane, thank you so much. All the best with this stuff. You are right at the cutting edge of what’s going on out there right now. Must be very fun, slightly scary. Good luck to you with that.
Shane Cooper: Thanks very much, Ghost. It’s been a pleasure and I look forward to chatting again.
In this special IMF edition of No Ordinary Wednesday, Cumesh Moodliar, CEO of Investec South Africa, and Ruth Leas, CEO of Investec UK, unpack the signals from this year’s meetings in Washington – from the “three Ts” shaping investor sentiment (Trump, technology and tariffs) to the cautious optimism surrounding South Africa’s reform momentum.
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.
4Sight Holdings has flagged strong earnings (JSE: 4SI)
The share price has had a huge week
4Sight Holdings is up 25% in the past week, with a steady increase in the share price over several days in the lead up to a trading statement that came out on Friday. It’s always worrying when a share price moves a few days before the news comes out.
The news itself certainly supports a positive share price move, with HEPS up by between 25% and 35.4% for the six months to August. Detailed results will be released by the end of October.
Insimbi Industrial Holdings is still loss-making (JSE: ISB)
At least the operating performance looks better, even if HEPS doesn’t
Insimbi has been through a tough time. Aside from the obvious global issues like tariffs, there’s also been great uncertainty in the local steel market, ranging from automotive customers through to the situation at ArcelorMittal.
Against this backdrop, Insimbi’s revenue increased by 2% for the six months to August 2025 – a decent performance under the circumstances. The group has been through a fair bit of restructuring to improve the cost base, with the benefits coming through in a 65% increase in operating profit.
Alas, the bottom of the income statement is still in the red, with a loss of R8.6 million vs. R9.4 million in the prior period. HEPS was -1.30 cents vs. -1.22 cents in the comparable period.
Although cash generated from operations was sharply negative in this period, the company has noted that this was due to the end of the period being on a Sunday. Substantial amounts were received from debtors in the first week after month-end. This is perhaps something for investors to keep an eye on when the full-year results come around.
Jubilee Metals hopes to conclude the disposal of the local operations by December (JSE: JBL)
In the meantime, they’ve given an update on the chrome and PGM business in South Africa
Jubilee Metals is in the process of becoming a focused Zambian copper group. They are selling off the South African chrome and PGM business, with only two major conditions outstanding (one of which is Competition Commission approval). They have received the first tranche ($15 million) of the sale consideration and they hope to get the deal done by the end of the 2025 calendar year.
The company has given an update on the local performance in the meantime, as the deal isn’t done until all the conditions are met. For the first quarter of the new financial year, chrome concentrate production fell 11.2% year-on-year and PGM production was down 10.1%. In both cases, the cessation of a major contract is to blame for the decrease.
Labat’s pivot to “high-technology” may be an hilarious description, but it’s the right move (JSE: LAB)
The days of being a financially dicey cannabis business are behind them
I nearly spat out my coffee when I read the Labat report about their pivot to “high-technology” investments. I’m not sure if they just have a sense of humour or if that’s the description that they genuinely believe is appropriate, but it’s hard not to laugh in the context of what used to be a cannabis company.
Either way, the acquisition of Classic International Trading has made all the difference. The anchor business at Labat is SAMES (South African Micro-Electronic Systems) and the integration of the acquired businesses has clearly gone well. This success in technology has driven Labat to a decision to move away entirely from healthcare and cannabis, with a plan to dispose of this business and transfer Labat’s listing to the technology sector on the JSE.
Despite having a gazillion more shares in issue after capital raising and acquisitive activities, Labat still saw a remarkable improvement in HEPS for the year ended May 2025. The reality is that if you swing from a headline loss of R25.6 million to a headline profit of R125 million, it doesn’t matter how many shares are in issue – you at least have a pie that is worth slicing up and dividing among shareholders!
I do hope that the candid style of reporting continues, as this paragraph in the litigation section was also pretty funny: “In 1999 SAMES (“the taxpayer”) had an assessed tax loss. For some or other reason, unbeknown to the taxpayer, the South African Revenue Services (SARS), disallowed the assessed loss in the year 2000 and “created” a non-existing Income Tax liability. SARS then withheld VAT credits owed to the taxpayer and allocated it to a non-existent Income Tax (IT) “liability”. No further credits, was paid out to the taxpayer to date hereof. This had now been going on for more than 20 years.”
This is a new era for Labat. The share price is 8 cents and HEPS was 13.28 cents, so the group is on a P/E multiple of 0.6x. You won’t see that every day.
The Prosus offer for Just Eat Takeaway.com has been finalised (JSE: PRX)
Prosus will use squeeze-out provisions to get to 100%
Prosus has big plans for its platform businesses. The AI theme is visible everywhere, with the idea being to use these technologies to improve the profitability of the various groups that Prosus has invested in.
The deal for Just Eat Takeaway.com in Europe will be watched closely, as this transaction has been put together under Fabricio Bloisi’s watch as CEO. This makes it distinct from the portfolio of businesses that he inherited from the previous management team. The other reason why the market will pay plenty of attention to this integration is that Prosus will need to demonstrate the true power of AI in making these platforms more appealing, particularly in Western Europe where growth is hard to come by.
The offer has been finalised, with Prosus achieving acceptances from holders of 98.19% of shares in Just Eat Takeaway.com. Extending the acceptance period worked out well, as they locked in a further 8.06% of shares in the company. They will in any event use the standard squeeze-out provisions to get the remaining shares, so the expectation is that they will end up with 100%.
Just Eat Takeaway.com will delist on 17 November 2025.
Safari Investments is set to delist (JSE: SAR)
Heriot REIT (JSE: HET) will be the only remaining shareholder
Here’s something rather interesting: at a time when many property funds are taking advantage of market conditions to raise capital, Safari Investments is taking the opposite approach and repurchasing all the shares in issue that aren’t already held by Heriot REIT. This is essentially a take-private transaction with different structuring, using funds on the Safari balance sheet instead of Heriot needing to go and raise external money.
Heriot already holds a 59.2% stake in Safari. The rest of the register has very thin trade. It therefore doesn’t make a lot of sense for Safari to be listed and incur the associated costs. The more interesting rationale for the deal is that Safari wants to do more development work going forwards, which means that the dividend payout ratio would need to decrease.
Safari’s price for the scheme looks pretty cheeky. R8.00 per share is a premium to the 30-day VWAP of just 2.71%. They are basically telling shareholders that this is their only chance of a liquidity event, so they need to be happy with the price put on the table. Safari’s net asset value (NAV) per share as at June 2025 was R11.77, so they are looking to take the company private at a discount to NAV of 32%.
Safari has received irrevocable undertakings from holders of 34.03% worth of the shares that are eligible to vote. This means that there’s a long way to go to get to the level required to approve the scheme.
Stefanutti Stocks looks set to get a slice of those juicy new profits at Eskom (JSE: SSK)
The Dispute Adjudication Board’s ruling is great news for shareholders
In excellent news for Stefanutti Stocks shareholders (and perhaps not for taxpayers), the Dispute Adjudication Board has decided to award Stefanutti Stocks an additional payment of R685 million based on the Kusile Power Project dispute.
The share price is up by a whopping 51% over six months, yet only 13% year-to-date. It gets even crazier if you look over three years, with a jump of 366%! Stefanutti Stocks has been a highly speculative play where punters had to spend more time digging through the contractual claims than anything else.
When that goes right, it can be lucrative. But such plays can also go to zero, as many speculators have learnt the hard way on the JSE. Punters in Stefanutti Stocks will be very pleased to see the latest announcement.
Standard Bank’s growth continued in the third quarter (JSE: SBK)
Given all the underlying exposures across Africa, consistent performance is great to see
Standard Bank provides quarterly information to the Industrial and Commercial Bank of China (ICBC) as a significant minority shareholder. This is to allow the ICBC to correctly account for its investment in Standard Bank.
To ensure that all shareholders have the same level of information, Standard Bank releases this quarterly update to the entire market. Although the information is much lighter than a full report, it at least gives an idea of the recent performance.
In the first six months of the year, headline earnings increased by 8%. Standard Bank has indicated that this growth rate remained consistent in the third quarter. Earnings attributable to ordinary shareholders increased 10% over the nine months.
The share price is 13.5% higher year-to-date.
Zeder’s net asset value has dropped – and not only because of special dividends (JSE: ZED)
There’s some valuation pressure in the underlying portfolio
Zeder has released a trading statement for the six months to August 2025. They use net asset value (NAV) per share, which is the logical approach for an investment holding company.
The expectation is for NAV per share to drop by between 20% and 23.7% vs. August 2024. In case you’re wondering, it will be between 2.8% and 7.3% lower than the NAV per share reported as at February 2025.
To understand this, we need to look at the expected drop in NAV per share, not just the percentage move. The company has indicated a decrease of between 43 cents and 51 cents vs. August 2024. Special dividends of 31 cents per share explain some of the move, but the rest is thanks to negative fair value movements in the remaining unlisted investments in the period.
That’s not what the market wants to hear, hence the share price closed 6% lower at R1.25. The guided NAV per share is between R1.64 and R1.72, so the fund is trading at a significant discount despite the plans to return as much value to shareholders as possible.
Nibbles:
Director dealings:
If I look at the latest share awards at Aspen (JSE: APN), my overall sense is that most of the directors and executives kept all the shares and funded the tax from other sources. Sure, there were some who sold the taxable portion, but I’m certainly used to seeing far more sales when share incentives land at companies. Given the depressed nature of the Aspen share price, this is an interesting signal.
An employee of the Designated Advisor of Visual International Holdings (JSE: VIS) sold shares worth R5k. It blows my mind that when I try access the company website, I still just get a generic holding page for the domain.
Grindrod (JSE: GND) announced the appointment of Kwazi Mabaso to take over as CEO from Xolani Mbambo with effect from 1 December 2025. You may recall that Mbambo is heading across to Kumba Iron Ore (JSE: KIO) to take the CFO role. Grindrod considered internal and external candidates before choosing Mabaso. I’m always happy to see internal appointments, with Mabaso currently running Grindrod Terminals. He also has a lot of prior experience at Transnet.
KAP (JSE: KAP) is still deciding on who the new CFO will be to replace Frans Olivier when he steps into the CEO job on 1 November 2025. It’s going to be an important appointment, as the company is under pressure to improve its performance. The company has made “significant progress” in this appointment and expects to announce something soon. The share price has been slaughtered this year, losing half its value year-to-date!
Telemasters (JSE: TLM) has a market cap of under R50 million and very little trade in its stock, so the results for the year ended June 2025 only get a passing mention down here. Revenue increased 7.8% and although operating profit was down 16.5%, there was a juicy 59% jump in HEPS. A quick look at the segmental reporting reveals that both major divisions experienced an increase in net profit in this period. The dividend per share doubled to 0.2 cents per share, although that is clearly off a tiny base.
Attacq (JSE: ATT) announced that GCR Ratings affirmed the long-term and short-term national ratings of the company. This is very important for the Domestic Medium-Term Note Programme and the cost of debt for the group.
Texton (JSE: TEX) has obtained SARB approval for the return of contributed tax capital of 63.87 cents per share (for context, the share price is R3.59 – so it’s a chunk portion of the market cap). The payment date is 30 October 2025.
Numeral (JSE: XII), one of the smallest companies listed on the JSE, released results for the six months to August 2025. Revenue jumped by 515% to almost $1.2 million and operating profit was $186k.
Due to related party rules, Merafe (JSE: MRF) had to release an announcement for something that seems like business-as-usual and nothing more. The company’s joint venture with Glencore (JSE: GLN) extended a fuel supply agreement with Astron that has been in place since 2020. It will now run until 2030. The only reason why they need to announce this is that Astron is an associate of Glencore and thus a related party to Merafe. As the contract is in the ordinary course of business and has been concluded on an arm’s length basis, no shareholder approval is required.
Note: Ghost Bites is my journal of each day’s notable news on SENS. It reflects my own opinions and analysis and should only be one part of your research process. Nothing you read here is financial advice. E&OE.Disclaimer.
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