Exemplar REITail shows how strong township and rural retail is (JSE: EXP)
It’s just a pity that the register is so tightly held
Exemplar REITail has 28 property assets in its portfolio. This is the only listed property fund that focuses exclusively on rural and township retail, which makes it interesting. Sadly, there is minimal trade in the stock, so it’s hard to get exposure here.
I therefore won’t go into immense detail when it comes to their interim numbers for the six months to August. Instead, I’ll just note that the net asset value per share was up 11.9% and the dividend per share has jumped by 21%. The informal-into-formal retail trend is a major growth engine in South Africa, which is why we’re seeing an increasing number of property funds pushing into this strategy.
Octodec’s distributable income per share is growing by high single digits (JSE: OCT)
The main thing investors look for in REITs is income growth ahead of inflation
In the first trading statement dealing with the year ended August 2025, Octodec noted that distributable income per share is expected to grow by between 3% and 6%. Things came out even better than expected, with the updated guidance being growth of between 7% and 9% thanks to reduced expenses, asset disposals and the treasury management strategy.
The dividend per share seems to be following suit, growing by between 7% and 9%.
Results are scheduled for release on 25 November 2025.
Double-digit HEPS growth at Omnia (JSE: OMN)
Despite this, the share price has had a sideways (and volatile) year
Omnia Holdings released results for the six months to September 2025. Revenue was up 3% and operating profit increased 12%, leading to an 11% increase in HEPS. Although that revenue growth is anything but exciting, the outcome for shareholders is more than decent by the time we reach HEPS.
If we look at the segments, Chemicals is the ugliest of ugly ducklings. Revenue fell 38% and the segment generated an operating loss once more. They are busy restructuring this part of the business. Luckily, the operating loss of R22 million is much smaller than the profits generated elsewhere, with Agriculture up 9% to R458 million and Mining up 7% to R570 million. Although Omnia’s underlying exposure goes well beyond the South African market, these are core sectors for the local economy and I’m glad to see them growing.
The share price doesn’t reflect much growth though, having been sold off hard during the initial tariff scare before recovering to 4% down year-to-date.
An unlucky currency hedge has hit PPC’s numbers, but they are still doing well (JSE: PPC)
The point of a hedge is to manage risk, not make a profit
As part of the plan to build an impressive new cement plant in the Western Cape to take advantage of growth in the region, PPC entered into a hedge due to the US dollar exposure related to the construction. The timing of this has proven to be very unlucky, as the rand has appreciated against the US dollar and thus bucked the trend we’ve seen over more years than anyone cares to remember.
Hindsight tells us that PPC would’ve been better off without the hedge, as they’ve had to recognise losses on the foreign exchange contracts. But had the rand gone the other way and the cost of construction had moved higher, then shareholders would’ve been worse off. The point of the hedge is to create certainty, not trading profits on forex.
Thanks to the losses on the hedge, HEPS will be between 8.3% and 18.7% higher for the six months to September. If you adjust for the hedge in an attempt to isolate the operating performance, you get to between 27% and 36%.
Raubex dragged lower by ugly numbers in certain segments – especially Australia (JSE: RBX)
If you’re looking for an example of segmental volatility, this one is for you
Raubex makes a song and dance about their diversification strategy. When you look at the segmental performance for the six months to August 2025, you’ll quickly see why. The numbers jump all over the place, with volatility that would make poultry businesses blush. Add them all together and you at least get a smoother outcome, but sometimes that outcome can still be sharply negative.
In the interim period, group revenue fell 1%, operating profit was down 28.7% and HEPS fell 14.4%. Of more concern is cash from operations, which tanked by 50.5%. The interim dividend couldn’t withstand the pressure and fell by nearly 14%.
That’s a yucky set of numbers. Brace yourself though: we need to dig into the problematic segments.
Australia stands out for being truly awful, with revenue down 17.8% and a wild swing from operating profit of R158 million to an operating loss of R95 million. That’s a negative swing of R253 million! A large mining project is largely to blame for this, giving us example number five bazillion that the risks in Australia for South African businesses extend well beyond finding a deadly spider in your shoe.
To show just how violent the swings are, here’s a positive one: the Infrastructure division’s operating profit jumped from R85.5 million to R180.1 million. There’s a specific focus on renewable energy in South Africa, so it’s great to see this growth as a result of investment in these assets in our country.
Before we feel too warm and fuzzy, we should look at Material Handling and Mining, where profit fell by over 50% to R88 million. Sigh. Chrome prices are the big problem here, with Bauba generating an operating loss. It’s at least better than the loss in the second half of the prior year, but it’s still very worrying. Does it make sense to have a mining business alongside all these construction plays? No, it doesn’t. Hopefully they will recognise this at Raubex and get this risk off the balance sheet.
The swings continue in the other segments. Construction Materials fell 14.8% to R142 million, while Roads and Earthworks put in a positive performance with growth of 11.8% to R288 million.
It seems like some of the pain in this period is of a non-recurring nature (like the Australian project), so perhaps the bottom is in. It just feels impossible to accurately forecast the performance of a group with such varied and volatile segments.
Shoprite is still growing in an environment of very low food inflation (JSE: SHP)
Price inflation was flat at Shoprite and negative at Usave!
Retailers generally enjoy a moderate amount of inflation. At the very least, they need to avoid a situation where their costs are inflationary (wages / security / energy etc.) and their product prices are stagnant, as this puts them on a difficult treadmill where the only way to survive is through growth in volumes.
In such an environment, only the best retailers do well. The rest wash away.
We seem to be in such a situation in grocery retail, with Shoprite reporting sales growth for the three months to September of 8%. That’s well off the 11.4% in the first quarter of the prior year, but solid in the context of group selling price inflation of just 1.4% vs. 2.6% in the comparable period. This inflation was found in the higher LSM items in the group (e.g. at Checkers), as Shoprite’s inflation was 0% and Usave was -0.4%!
This makes it very, very difficult for inefficient competitors like Pick n Pay (JSE: PIK) to make progress against Shoprite. Thankfully for that group, Boxer (JSE: BOX) is putting up a very good fight at the lower end of the LSM curve.
Supermarkets RSA growth was 7.9% overall, while Supermarkets Non-RSA managed 12.9% thanks to improved conditions in the seven other countries in which Shoprite trades. The Other Operating Segments contributed growth of 4.8%, with Medirite pharmacies as a bright spot.
Although Shoprite might be doing well relative to competitors, the share price this year has dipped 4% due to how demanding the valuation is. Investors love Shoprite, but they still need to see plenty of growth when the P/E multiple is 21x.
Sibanye-Stillwater removes the Appian overhang (JSE: SSW)
The parties have settled on the eve of the trial
Sibanye-Stillwater is making plenty of money right now, so it’s a good time to deal with share price overhangs and get them out the way. They’ve agreed to settle the dispute with Appian Capital Advisory for $215 million (including the legal fees already paid). The trial was due to begin yesterday, so they’ve just about settled on the court steps!
This dispute relates to Sibanye pulling out of the acquisition of Atlantic Nickel and Mineração Vale Verde due to a “geotechnical event” at the time. Appian sued Sibanye for over $1.2 billion in damages, with the underlying implication being breach of contract and Sibanye using the “event” as a convenient excuse to get out of a deal they couldn’t afford to close.
Although this settlement is money down the drain for Sibanye, I think pulling out of the deal may well have saved the group during the dark recent times in the PGM sector. Either way, it’s over now.
HEPS more than doubled at Telkom, but there’s a catch (JSE: TKG)
The base period included major distortions – yes, even in the HEPS figure
Telkom released a trading statement for the six months to September. At a cursory glance, they absolutely crushed it, with HEPS from continuing operations jumping by between 105% and 115%. In other words, it more than doubled! HEPS from total operations (which includes Swiftnet in the base period) increased 57% to 65%.
But there’s a significant further distortion in these numbers, even if you look at HEPS from continuing operations. The base period included a derecognition loss of R451 million (after tax) related to the Telkom Retirement Fund. It also included R117 million (again, after tax) on restructuring costs. That’s a combined R568 million. That’s a huge adjustment when you consider that profit after tax for the September 2024 period was R853 million – or R1,421 million without those issues!
It looks like HEPS growth was in the mid-20s if you adjust for the distortion. That’s still a great growth rate obviously, but the truth of it is that the huge jump in profits actually happened in 2024 if you read closely, not 2023.
Lots of positive narrative at Tiger Brands, but we have to be patient for the numbers (JSE: TBS)
The share price has had a very strong run
Much as the JSE has done well this year, it’s actually quite difficult to find companies outside of the mining sector that have had a good time in 2025. Tiger Brands is an exception, with excellent recent performance and strong support from the market for the ongoing turnaround.
In a trading statement for the year ended 30 September, they noted core revenue growth across all their business units and improved operating margin. They also avoided complaining about online gambling. How odd that once again, the FMCG company that is doing well isn’t trying to create a distraction based on external factors?
With volume growth throughout the year and a double-digit operating margin, Tiger Brands is a much better business these days. They’ve been simplifying their operations by selling businesses where they don’t have an obvious competitive advantage. Recent examples include the disposals of Carozzi and the baby wellbeing division. They’ve also agreed to sell their 74.69% interest in their Cameroonian chocolate subsidiary. There are some listed retailers that would benefit tremendously from this kind of discipline.
We will have to be patient until 26 November to get the full details. In the meantime, what we know is that HEPS from continuing operations will be up by between 25% and 30%, while HEPS from total operations is up by between 10% and 15%.
It’s been a textbook turnaround at Tiger Brands. Well done to them – and to those who invested in the story!
Egypt is more than a quarter of the business at Vodacom (JSE: VOD)
But there’s no confirmation of the Please Call Me number
Despite bringing this issue to a close after what felt to everyone involved like a lifetime, the Please Call Me settlement was given exactly one line of attention in Vodacom’s announcement of their results for the six months to September 2025.
“Separately, the Please Call Me matter has been settled by the parties out of court. Both parties are glad that finality has been reached in this regard.”
That’s it. So it ends, with barely a puff of dust.
If you dig into the detailed results, you’ll find more information in the “events after the reporting period” section. It’s mainly an historical summary though, with the company once again refusing to disclose the amount paid to settle it.
Vodacom made plenty of money in the six months to September 2025, so I remain convinced that they used a strong period as a great way to settle the matter and “hide” the pain in and amongst the good stuff. Corporates do this kind of thing all the time. The difference here is that it was such a high profile issue.
For the interim period, revenue growth was 10.9% as reported and 12.1% on a normalised basis, which adjusts for forex moves among other things. The similarity between these numbers explains exactly why the telcos are doing so well at the moment: currencies in Africa have stabilised thanks mainly to dollar weakness, which means that the excellent local currency growth actually means something for investors from other countries (including South Africa).
This revenue growth was strong enough to boost operating profit by 25.5% as reported, while HEPS jumped by a juicy 32.3%. The total dividend per share “only” increased by 15.8% – a mid-teens outcome that investors would’ve scarcely believed possible a year ago.
Free cash flow has swung sharply positive, coming in at R2.7 billion vs. an outflow of over R1 billion in the comparable period.
MTN (JSE: MTN) may have gotten all the prior attention around Africa, but Vodacom is making big moves on the continent. Egypt now contributes 26.8% to group revenue and that business achieved local currency growth of 42.3% in revenue in this period, so Vodacom will be desperately hoping for ongoing stability in the exchange rates to maximise this high growth. Safaricom is also achieving strong growth in Kenya, with M-Pesa as Africa’s largest mobile money platform. Vodacom has also taken other steps like implementing an infrastructure sharing partnership with Airtel Africa across several African markets.
In South Africa, service revenue increased by only 2.2%. This is a mature market, which is why Vodacom fought so hard for approval for the 30% stake in Maziv (the fibre deal with Remgro (JSE:REM) on the other side).
In an environment of reasonably stable African currencies, telcos become growth assets. The risk is that they are so exposed to macro factors that are way outside of their control.
Nibbles:
- Director dealings:
- Marshall Monteagle (JSE: MMP) raised $10.7 million in a rights offer that was not underwritten and that allowed for excess applications. 89.81% of the offer was spoken for through normal subscriptions, with the rest achieved through excess applications. It looks like the CEO was responsible for roughly $7.9 million of the raise, hence I’m including this with the director dealings.
- An executive director of Impala Platinum (JSE: IMP) sold shares worth R17.6 million.
- A prescribed officer of Standard Bank (JSE: SBK) sold shares worth R5.2 million.
- A director of a major subsidiary of Woolworths (JSE: WHL) sold shares worth R3.1 million.
- An associate of the CEO of KAP (JSE: KAP) bought shares worth R610k. It’s good to see more skin in the game.
- A director of Visual International (JSE: VIS) participated in the bookbuild to the value of R530k. Also, an employee of the company’s Designated Advisor bought shares via the bookbuild for R10k. And no, I still can’t find a working website.
- A director of Afrimat (JSE: AFT) and his associate bought shares worth R320k.
- The JSE (JSE: JSE) – yes, the company that owns the exchange is listed on its own product – announced that the Competition Commission has referred it to the Competition Tribunal for prosecution. Ouch! This relates to a complaint by A2X alleging exclusionary conduct around the broker dealer accounting (BDA) system and matched principal (MP) trade type. The Commission is seeking an amendment to the JSE’s rules, as well as a potential administrative penalty. Although the JSE strongly denies the allegations, the share price fell 3.4% in response to the news.
- On an otherwise busy day of news, I’ll just mention Powerfleet’s (JSE: PWR) interim results down here. Revenue was up 42% and the group emerged from an operating loss into an operating profit, so that’s obviously very helpful. They are still making a large headline loss though, albeit 40% smaller than it used to be. Adjusted EBITDA, the lifeblood of technology and platform businesses with offshore listings, increased by 59%. The share price closed 14.6% higher on the day, but on much lower volumes than usual (and volumes are already low on an average day).
- Supermarket Income REIT (JSE: SRI) has completed £40.9 million of acquisitions at an average net initial yield of 6.4%. This includes a Tesco centre in Northern Ireland for £25.6 million and a portfolio of 10 Sainsbury’s convenience stores for £15.3 million. This is the fund’s first investment in convenience grocery. The underlying leases in all cases are triple-net leases with inflation-linked increases, which tells you that the fund tries to follow a lower risk strategy. Following the acquisitions, the loan-to-value ratio will be 36%.
- Hulamin (JSE: HLM) renewed the cautionary announcement for the potential disposal of Hulamin Extrusions. The buyer is getting some final stuff out of the way before making a formal offer. Having said that, there’s still no guarantee whatsoever of an offer being made.
- African Rainbow Minerals (JSE: ARI) noted that the directors of Assmang (a joint venture with Assore) are figuring out the dividend to be paid by Assmang to shareholders. Assmang’s mandate is to maximise dividends and the company had R3.6 billion in cash as at June 2025, so African Rainbow Minerals is obviously pushing for something juicy here.
- Goldrush (JSE: GRSP) released a trading statement that has a percentage move that is of no help. This is because the company moved from investment entity accounting to producing consolidated accounts, which means that HEPS isn’t comparable at all. Instead of focusing on the huge year-on-year move, it’s more sensible to just look at the likely range for the interim period of between 7 cents and 7.30 cents. I must note that this seems low, so waiting for the detailed release of financials will be important.
- Tharisa (JSE: THA) announced that the bondholders of Karo Mining voted to extend the maturity date of the existing notes by three years to 1 December 2028, with the reward for noteholders being that the interest rate has moved higher from 9.5% to 11%. There’s also a fee of 2.6% being paid by Karo to Tharisa as the guarantor, although there’s more of a financial structuring thing within the group.
- Africa Bitcoin Corporation (JSE: BAC) invested a further R1.2 million in bitcoin. They now have bitcoin worth a total of R5.8 million. Aggregated with all other acquisitions over the past 12 months, this was actually a category 2 transaction! I’m just happy to see that more of the capital that was raised has actually gone into bitcoin, as was the mandate from investors.
- Southern Palladium (JSE: SDL) had planned to change its name to Southern Platinum. Major shareholder feedback on this intention was negative, so the company has listened to shareholders and withdrawn the change of name resolution from the AGM. The reason is that the company has a recognisable name, having been listed since 2022. Not throwing away brand equity unnecessarily sounds sensible to me.
- Shuka Minerals (JSE: SKA) is clutching at straws on SENS, although I do feel sorry for the position they seem to be in. They’ve released yet another announcement about the funding from Gathoni Muchai Investments that has experienced so many delays. This time, they expect payment of $350k “in the coming days” – certainly not the first time we’ve heard something along these lines. They need to settle the acquisition consideration for Leopard Exploration and Mining by the end of November.
- If you’re following Heriot REIT in detail (JSE: HET), then you’ll want to be aware that the company has released the circular to shareholders dealing with the conditional share plan for management and employees. It requires a shareholder vote to be approved.
