In this edition of Ghost Bites:
- Dipula Properties shows us that there’s money to be in made in property in the northern provinces of our country.
- Equites Property Fund is bringing capital home from the UK and investing it here.
- Nutun is still in a loss-making position.
- Universal Partners has a hit-and-miss portfolio.
Dipula Properties’ portfolio is performing (JSE: DIB)
The share price is up more than 30% in the past 12 months
Instead of owning flashy assets in Cape Town, Dipula focuses on a mainly Gauteng-based portfolio (58% of income). Their retail centres (67% of income) have a strong tilt towards township and rural markets.
This is one of the few genuine growth engines in South Africa, capturing the trend of lower income consumers moving from the informal to the formal retail market.
The fund now owns 155 properties with an average value per property of R73 million. This is better than the 161 properties they held in the prior period with an average value of R61 million. The group has been focusing on higher quality properties.
It’s an approach that works. For the six months to February 2026, net property income climbed by 9% and distributable earnings jumped by 20%. The net asset value (NAV) increased by 16% in total, but only by 4% on a per-share basis (the important metric).
The balance sheet is in good shape. Although debt increased from R3.8 billion to R4.0 billion, the gearing ratio improved from 36% to 34%. That’s a very healthy range for a property group.
Distributable income per share is expected to grow by between 7% and 8% for the full year. They have a dividend payout ratio of 90%.
Ghost Bite: Remember to always look at numbers on a per-share basis, especially in property companies that regularly raise additional equity capital. Dipula is doing well!
Equites Property Fund is bringing R2.1 billion home (JSE: EQU)
The company has locked in a significant disposal in the UK
For quite some time, Equites Property Fund has been talking about disposing of its interests in the UK market and bringing that capital back to South Africa. This is the opposite direction of travel to what we saw in the property sector a decade ago!
Although South Africa is a riskier market, it’s the risk vs. return trade-off that really matters. The UK market is mature and unexciting in this space vs. a South African market that offers strong yields and ongoing demand for distribution centres and warehouses.
The latest transaction is the sale of five distribution centres in the UK to a fund managed by ICG Real Estate. The net proceeds (after debt etc.) will be around R2.1 billion.
It works out to a 3.8% discount to the carrying value of the assets, so the buyer has squeezed Equites on their way out of the UK portfolio. The disposal yield is 5.5%, giving you insight into how high the yields must be in South Africa to make our local market more appealing to Equites.
This capital will be redeployed into the development pipeline, as Equites has pre-let development agreements with blue-chip tenants. They can also raise other funding on more attractive terms thanks to the positive impact of this UK disposal on the loan-to-value ratio of the group.
In a separate update, Equites noted that chairman Leon Campher intends to retire at the upcoming AGM in August. Fulvio Tonelli, who has been an independent non-executive director since 2022, will succeed him as chair.
Ghost Bite: If we can continue our positive trajectory in South Africa and improve our infrastructure, there will be plenty more capital flowing into development projects in our country. Offshore diversification is great, but we want to see local capital going into local projects to the greatest extent possible. Let me know in today’s poll how you are feeling about local vs. offshore exposure:
Nutun is still losing money (JSE: NTU)
Here’s our regular reminder of the sad and sorry demise of Transaction Capital
Once upon a time, in a world before COVID, Transaction Capital was one of the most exciting names on the JSE. They owned SA Taxi and Transaction Capital Risk Services. They subsequently acquired WeBuyCars (JSE: WBC) after the competition regulators blocked Naspers (JSE: NPN) from doing that deal.
But by the time the dust settled after a financial disaster at Transaction Capital, SA Taxi had been restructured and taken off the balance sheet due to immense financial distress. WeBuyCars was spun off and separately listed.
And the charred remains of this once great group were renamed Nutun, holding the debt collection and business process outsourcing operations of what used to be called Transaction Capital Risk Services.
Unfortunately, Nutun is still struggling to return to profitability. The loss for the six months to March 2026 is approximately half of what it used to be, which means a range of -7.5 cents to -8.6 cents. A smaller loss is helpful obviously, but these numbers really need to get out of the red now.
Nutun blames the stronger rand and the impact of a change in macroeconomic assumptions around interest rates.
Ghost Bite: Regardless of whether you have shares in Nutun or not, the important element of this update is the expectation around elevated interest rates. With inflation almost certainly ramping up this year, interest rate cuts simply aren’t going to happen.
Universal Partners remains a hit-and-miss portfolio (JSE: UPL)
There isn’t much to get excited about here
Universal Partners doesn’t have much liquidity in its stock, but shares do change hands from time to time. On an otherwise quiet day of news, I can give their quarterly results more attention than usual.
This investment holding company is focused on Europe and the UK, so that’s already a tricky way to achieve meaningful growth. They’ve made six investments since listing and achieved two exits.
The portfolio is best described as “random” – I really cannot tell you why any of these companies belong in the same group.
We begin with Workwell, which offers various employment solutions ranging from contractor management through to Employer of Record services. Growth is being boosted by bolt-on acquisitions, including in the US market.
Next up is PortmanDentex, one of Europe’s largest dental care platforms. This is the classic roll-up strategy, an approach that I’ve always been very skeptical of. Owning a lot of individual dental practices in one group is no guarantee that the economics will be meaningfully better than having these practices separately.
Sure enough, revenue and EBITDA at PortmanDentex are running below budget, with the company blaming a soft consumer environment. But they are also making senior hires to try and focus on better execution, so at least some of the issues must be internal. This is almost exactly how these roll-ups tend to go.
Onwards to SC Lowy Partners, a credit investing and lending business operating in Asia, Europe and the Middle East. There’s been a lot of financial restructuring of this investment, including equity exposure being changed into loan notes.
Finally, we get to Xcede Group. This is a recruitment business operating in Europe, the UK and North America. It’s nice to see that they are performing well this year, particularly given their focus on the tech space. In this AI world, there are still plenty of opportunities for humans.
I’m not sure what has happened to Propelair, the company that Universal Partners kept promising us was going to revolutionise the toilet (no kidding). Every time I saw an update on the company, it was performing below expectations. There’s no mention of it in the latest results at all!
As for the numbers, the net asset value per share has declined by 5.8% over the past 12 months. The shares are trading at R15.25 vs. the net asset value (NAV) per share of R26.34.
Ghost Bite: If your portfolio ranges from dentists through to credit lending, while featuring the sudden flushing away of a toilet company, then it’s very unlikely that investors will pay anything close to NAV.
Results of previous poll:
Nibbles:
- Director dealings:
- The format for notifications of trades by directors on the Australian Securities Exchange (ASX) is a pain to work with. Because Southern Palladium (JSE: SDL) is listed on the ASX, it’s unfortunately the format that we have to deal with. I just wish the company would give more information in the SENS itself! Anyway, aside from recent dealings by directors that were related to share options, there’s also an on-market purchase of 25,000 shares by the executive chairman. That works out to roughly R460k worth of shares.
- Aimia (JSE: AII), Rhys Summerton’s baby, has reported results for the quarter ended March 2026. There’s still no trade in the shares on the JSE, with the market waiting to see exactly what he will pounce on now that the listing is in place. The group is currently focused on the disposal of Bozzetto (an Italian specialty chemicals business). They are reducing debt and holding company costs, both typical of a turnaround strategy. This leaves them with rope manufacturer Cortland International as the main asset. The global trade environment is putting pressure on the performance of that business, with EBITDA from continuing operations dipping from $2.7 million to $2.5 million. They have much to do.
- Back in 2023, the JSE imposed a public censure and penalties against Murray Munro, the former CFO of Tongaat Hulett (JSE: TON). Munro appealed it to the Financial Services Tribunal, with that appeal being dismissed. He then went to the High Court, which has ordered that the matter be remitted to the JSE. The JSE has applied for leave to appeal the court’s order.
