Ghost Bites (Anglo American | Ellies | Newpark REIT | PSG Financial Services | Sirius | Tharisa | Transcend – Emira | Trustco)

Listen to the latest episode of Ghost Wrap here, brought to you by Mazars:

Anglo American shines the spotlight on the crop nutrients business (JSE: AGL)

The company wants investors to pay attention to this opportunity

Anglo American is currently hosting analysts and investors on a visit to the crop nutrients business in the UK. This is a low-risk jurisdiction in which the business will produce natural mineral fertiliser. Anglo is excited about “major structural advantages” based on the size and quality of the orebody and the proximity to logistics infrastructure.

It’s notable that the CEO of this business is the same executive who led the delivery of the Quellaveco copper mine in Peru. I’ll bet that he misses the weather.

If you want to read a very detailed presentation on the project, you’ll find it at this link.

Where, oh where is the Ellies circular? (JSE: ELI)

Investors must be getting very nervous about the Bundu Power deal by now

In dealmaking, the passage of time is the enemy. The best time to close a deal was yesterday. The second best time is today. There’s nothing that makes everyone more nervous than ongoing delays.

The acquisition of Bundu Power by Ellies is likely key to the survival of this listed group. The transaction was announced back on 1 February 2023 and we still don’t even have a circular yet.

There’s another extension to the posting date, all the way out to 30 November.

Newpark REIT releases a very encouraging update (JSE: NRL)

The dividend has grown strongly and guidance has improved

It’s a real pity that there is basically zero liquidity in Newpark. At just R4.50 per share, an interim dividend of 35 cents per share is very juicy. That dividend is 40% higher than in the comparable period.

The other good news is that guidance for the year ending February 2024 in terms of funds from operations per share has been moved significantly higher, coming in at expected year-on-year growth of between 13.62% and 25.58%. This is thanks to improved operational metrics and lower than anticipated refurbishment costs. The dividend for FY24 is expected to be between 5% and 15% higher than the comparable period.

PSG Financial Services shows encouraging growth (JSE: KST)

Regardless of which earnings metric you use, growth looks strong

PSG Financial Services (previously PSG Konsult) released a trading statement for the six months to August. There are a variety of metrics.

Recurring HEPS is up between 20% and 23%. If you exclude amortisation, it’s up between 18% and 22%. HEPS is up by between 20% and 23%. Finally, in case none of these suit you, attributable earnings per share will be between 19% and 23% higher.

As you can see, these are strong numbers regardless of which earnings metric you elect to focus on.

Sirius recycles capital (JSE: SRE)

Capital has been shifted from Germany to the UK

Sirius Real Estate has sold a business park in Germany for €7.3 million, on a net initial yield of 6%. The disposal was at a 5% premium to book value. This is a mixed-use asset which is 92% let.

Separately, the company announced the completion of the acquisition of two mixed use industrial assets in the UK for €9.5 million, executed through the BizSpace subsidiary. That deal was announced in July 2023. The purchase price is a net initial yield of 9.6%.

Basically, what they’ve done here is sell a mature asset at a good price and acquire assets where they believe active asset management can improve the value. That’s a good strategy for recycling capital, though investors will need to think about whether they prefer Germany or the UK in terms of underlying exposure.

Tharisa gives an update on the Karo project (JSE: THA)

Thanks to Karo having raised debt publicly, these announcements will be coming regularly

I’ll forgive you for having never heard of the Victoria Falls Stock Exchange (VFEX). If you’ve been following Tharisa, you’ll know that Karo raised a debt instrument on that exchange. This means that Karo needs to release updates to the market. Remember, this is only one part of Tharisa’s group.

Karo poured first concrete in June 2023 and has 540 people on site, of which 99 are Karo employees. That’s obviously very helpful for the economy in the region.

The company also announced some important appointments to the board.

Transcend shareholders say yes to the Emira dress (JSE: TPF | JSE: EMI)

The scheme received a strong approval rate

Shareholders of Transcend Residential Property Fund have voted on the scheme of arrangement related to the offer by Emira to acquire all of the ordinary shares in the fund. The deal received approval from holders of 91.85% of shares that were voted.

The parties will now focus on the remaining conditions precedent and the clean-out distribution, all of which were previously dealt with in the circular.

Trustco continues to entertain us with daft commentary (JSE: TTO)

They just don’t know when to stop

The ink is barely dry on the JSE’s censure of Trustco, yet the company is out here with ill-considered SENS announcements yet again. They just have no idea when to give up.

Having lost out at the Financial Services Tribunal, the approach taken is now to try and discredit the JSE’s decision.

Firstly, if my share price looked like this, I would try to be less arrogant:

Secondly, I certainly wouldn’t boast about “exceptional performance this year, nearly doubling in value, representing an impressive gain of 95.1%.” You can barely even see that gain on the five-year chart.

Here’s an excerpt from the latest announcement. You decide for yourself whether this is the right way to respond to a highly contested censure:

Little Bites:

• Director dealings:
  • Des de Beer has bought R2 million worth of shares in Lighthouse Properties (JSE: LTE).

• NEPI Rockcastle (JSE: NRP) has enjoyed strong support from investors in the scrip issue alternative for the dividend. In simple terms, this means that 74.3% of shareholders elected to receive shares instead of a cash dividend, which helps the company retain capital.

• Schroder European Real Estate Investment Trust (JSE: SCD) has confirmed that the interim dividend is 29.88120 ZAR cents per share.

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