Burstone is at the lower end of guidance for distributable earnings (JSE: BTN)
The South African property portfolio is outperforming Europe
Burstone released a pre-close update for the year ending March 2026. The key takeout is that distributable earnings for FY26 will increase by 2% to 3%, which is at the lower end of full-year guidance. The dividend payout ratio will be maintained at 90%.
The South African portfolio is doing the heavy lifting. Accounting for around 80% of group income, this portfolio enjoyed an uplift in net property income of 4% to 5%. The retail portfolio has been an exceptional performer, contributing 45% of the South African portfolio and growing by 8% to 19% in this period.
The same can’t be said for Europe, where the like-for-like performance was slightly down vs. the prior period. Higher vacancy rates were a major factor here. Despite the pressure in Europe, Burstone will be launching a new light-industrial platform in the region with Hines European Real Estate Partners. Burstone will invest 20% of the equity and will act as investment and asset manager, unlocking fee income along the way.
In Australia, they are growing off a low base and securing additional capital from partners to deploy in the region.
Burstone still hasn’t made any final decisions around a South African property platform with external investors, even though we’ve been hearing about this strategy for a couple of years now. Given the local performance, perhaps they don’t want to dilute their equity ownership in these assets?
Overall, the group’s fund and asset management activities now contribute between 15% and 17% of group earnings vs. just 10.7% in FY25.
The loan-to-value ratio sits at 40%, right at the top of the group’s target range. To help manage it, they expect to recycle capital through South African asset disposals.
My overall read is that they are growing with Other People’s Money (every banker’s favourite concept) in Europe and Australia, while being cautious with any dilution in South Africa. That’s not a bad thing at all.
The market has no love for Bytes Technology Group at the moment (JSE: BYI)
The share price has halved in the past year – and shed 15% on Tuesday!
Bytes Technology Group is having a tough time. They are far too reliant on businesses like Microsoft, evidenced by the impact of changes to Microsoft’s enterprise incentive structures. The market used to be willing to pay a high Price/Earnings multiple for this story. But not anymore.
In a trading update for the year ended February 2026, Bytes confirmed that they performed in line with the outlook they gave in October 2025. This means double-digit gross invoiced income growth.
Although gross profit was up 6% in the final two months of this financial year, the outlook is for flat operating profit in FY27.
To make it worse, the underlying assumption in achieving flat operating profit is that gross profit will be up by high single-digit to low double-digit percentages in FY27. If they miss that gross profit target, does that mean that operating profit will decrease year-on-year?
In case you’re wondering, the expected cost pressures relate to higher technology costs and a “return to normal bonus levels” alongside higher headcount – not the kind of thing that investors want to read when a share price is in the toilet.
Forgiveness will come if the headcount and bonus investment translates into a more resilient business that is capable of growing. They have initiatives across the private and public sector to make this happen.
And if it doesn’t? Well, on a P/E of 13x, there’s still plenty of room to drop further – especially as a growth stock with broken wings.
What’s your view on this one?
Discovery is selling a R831 million investment that you probably didn’t know they had (JSE: DSY)
Ever heard of Cambridge Mobile Telematics?
As a reminder of the sheer scale of Discovery, the company has announced the disposal of approximately half of its stake in Cambridge Mobile Telematics (CMT) for R831 million.
The returns here are a bit of a joke. In 2014, Discovery invested $5 million for a 21.67% stake. After plenty of dilution (and a delicious partial sale for $28.5 million), Discovery’s stake in CMT had reduced to 8.7%.
This means that Discovery is now selling around 4.3% in CMT for $49.5 million (that’s where the R831 million is coming from).
This has obviously been an incredible investment in the company that has provided the expertise powering the telematics side of Discovery Insure’s operations. They turned $5 million into $78 million over 12 years!
What’s the lesson here? If your company is going to make another company very valuable, then make sure you get an equity stake along the way.
Losses have nearly halved at Gemfields (JSE: GML)
They’ve had a couple of very tough years
Gemfields released a trading update for the year ended December 2025. The good news is that the headline loss per share has improved by 44.8% in rand terms. The bad news is that they are expecting a loss of 21.6 cents on a share price of R1.10.
Due to the recent rights issue to recapitalise the company, the weighted average number of shares in issue has increased by roughly 26%. More shares in issue is usually a negative point, as it is dilutive to HEPS. But when a company is in a loss-making situation instead, it actually spreads the losses across more shares!
In other words: the underlying business performance is worse than what’s implied by the 44.8% improvement in headline loss per share.
This shouldn’t be a surprise. The year was affected by operational interruptions at both the ruby and emerald mines. There’s been a delay in the final commissioning of the PP2 ruby processing plant, with this issue expected to continue well into the first half of 2026. In addition to the internal issues, auction outcomes during the year were a mixed bag. Only high-quality emeralds and rubies achieved an encouraging pricing trajectory, with the lower-quality stuff under pressure.
They need to achieve further deleveraging of the balance sheet (i.e. reductions in debt). If they don’t achieve a substantial improvement in the operations, I’m scared that this might involve asking shareholders for more money.
The share price is down 72% over 3 years. Yikes.
Insimbi Industrial Holdings has reduced losses (JSE: ISB)
But they haven’t swung into profits just yet
Insimbi Industrial Holdings released a trading statement for the year ended February 2026. They expect the headline loss per share to improve by at least 30% vs. the prior period’s loss of 6.5 cents per share.
But that means that there is still a loss.
EBITDA is expected to be at least 40% up on the prior period. Aside from better revenues, they’ve also reduced costs during the year. These benefits were partially offset by the once-off costs incurred to close loss-making operations during the period.
The share price has lost nearly half of its value over 3 years, so a couple of rough years have taken their toll. The good news is that the price is up 7% over 12 months, so perhaps it bottomed in the past year and wants to move higher?
MAS is firmly a NAV growth story these days (JSE: MSP)
Will shareholders ever see another dividend?
You may recall all the corporate activity around MAS towards the end of last year. Despite being one of the more obscure JSE-listed property funds, MAS became the focus of a battle between Prime Kapital and South African institutional investors.
Prime Kapital emerged victorious, which means that MAS is now firmly a net asset value (NAV) unlock play rather than a dividend play. Investors are far more likely to see share buybacks than further dividends from MAS. This isn’t necessarily a bad thing, but it’s outside of the norm in the property sector.
The company has changed its most relevant measure of performance. Instead of distributable earnings per share, they will be using total shareholder return (the growth in NAV per share over 12 months, plus any payments made to shareholders).
On that note, the total shareholder return for the 12 months ended December 2025 was 7%. That sounds encouraging, but underlying earnings per share for the six months to December 2025 came in much lower than the comparable period.
This is where you need to be careful. Total shareholder return will always be reported on a trailing twelve months basis, even when the company releases interim results for a six-month period.
There are various reasons why earnings per share was just 1.97 eurocents in this period vs. 12.01 eurocents in the prior period.
For example, the trading environment was nowhere near as strong in Romania in this period as it was in the prior period. They also sold a property portfolio in January 2025 and reinvested the proceeds at lower returns. There was a negative fair value adjustment on a property in Germany that is in the process of being sold.
There was also a loss attributable to the ordinary shares in the DJV joint venture. Aside from underlying pressures on development activity, there were higher finance costs in the DJV after debt was raised to acquire shares in MAS.
The loan-to-value ratio at MAS is 21%, which is lower than 25.6% as at December 2024.
In a separate announcement, PK Investments (listed on the Cape Town Stock Exchange) has announced a bid to increase its stake in MAS from the current level of 37%. They want to acquire up to 40 million shares at a guided price of R19.75 per share, although the final pricing of the offer will be based on a clearing price.
40 million shares represent roughly 5.5% of total MAS shares in issue. The other important point is that the MAS share price is currently R19.70.
Netcare seems to be doing well (JSE: NTC)
EBITDA margin is the important thing to watch
Ahead of an investor conference at Sun City, Netcare has provided a voluntary update on the operating performance for the five months to February 2026.
Normalised paid patient days grew by 0.8% for the period. The acute business was up 0.5%, impacted by changes in the medical scheme industry that are affecting member utilisation. Mental health was up 2.9%, giving us another great reminder of the times we live in (and where Netcare is investing).
Both the acute and mental health businesses are expected to have a strong second half performance based on increases in the number of beds and other initiatives.
Revenue for the period was up by 4.5%. Although that doesn’t sound like much, it was enough to drive a slight increase in the EBITDA margin. This means that Netcare is doing a good job of controlling costs.
R292 million was invested in share buybacks during the period at an average price of R16.08 per share. The current share price is R16.56.
Nibbles:
- Director dealings:
- The CFO of Thungela (JSE: TGA) has sold shares worth R43 million as part of the early termination of an off-market collar hedge over 250,000 ordinary shares. The structure was entered into in April 2024. In a separate announcement, the company noted that the group’s HR exec sold shares worth R2.7 million.
- The CEO of Marshall Monteagle (JSE: MMP) bought shares worth over R2.5 million.
- A director of Schroder European Real Estate Investment Trust (JSE: SCD) bought shares worth almost R280k.
- Aimia (JSE: AII) has reported results for the quarter and year ended December 2025. This Canadian-listed holding company listed quietly on the JSE recently. The group’s recently appointed executive chairman is Rhys Summerton, who also happens to be the CEO of iOCO (JSE: IOC). Naturally, people are speculating about the plans here. There’s absolutely no liquidity in Aimia on the JSE at the moment, so the results are a somewhat moot point for now. The group is sitting on cash of $109.2 million. With a deal in place to sell specialty chemicals business Giovanni Bozzetto, they expect to generate net proceeds of $265 to $271 million. That’s quite a war chest…
- Tharisa (JSE: THA) announced improved trade facilities for its subsidiary that trades chrome concentrates. Local and international banks have provided two separate facilities of $45 million in total, with an accordion of $15 million. As a reminder, an accordion allows a facility to be increased in size without changing any of the other terms. Support from the banks is always good news.
- Between September 2025 and March 2026, PBT Holdings (JSE: PBT) repurchased shares to the value of R22.8 million. The average price paid was R6.69. The current share price is R7.00.
- In today’s edition of ASP Isotopes (JSE: ISO) keeping SENS busy, the company announced that a UK subsidiary of Quantum Leap Energy has commenced a strategic collaboration with the University of Bristol for the design of a state-of-the-art lithium laser research facility. And yes, this is another SENS announcement that should’ve just been a press release.
- Jubilee Metals (JSE: JBL) announced that the Phase 1 drilling results at the Molefe copper mine have been delayed pending sign-off from the Competent Person (as defined in the listing rules). They will release the results as soon as sign-off is complete.
