In this edition of Ghost Bites:
- Grindrod’s HEPS falls flat for the six months to June 2026
- Brace yourself for a wild move in Impala Platinum’s earnings
- The market celebrated the latest Shoprite update
Still to come in a later edition of Ghost Bites: Resilient REIT and Weaver Fintech
Grindrod’s HEPS falls flat for the six months to June 2026 (JSE: GND)
And the market doesn’t like it
Grindrod’s trading statement for the interim period ended June tells a story that the market hasn’t appreciated.
The guidance for HEPS is a movement of between -4.2% and +4.3%. At the mid-point, that’s an almost perfectly flat performance. With the share price closing 11.4% lower on the day, it’s clearly not what the market wanted to see from a company that has pulled off quite the turnaround story.
There’s an old saying in the market that bulls take the stairs and bears ride the elevator. It means that share price gains are usually incremental in nature, while declines tend to be sharp. The Grindrod chart is literally a textbook example of this:
Ghost Bite: Detailed results are due for release on 25 August. That’s a chart that is light on support levels at anything close to the current price, so it could be a very choppy couple of weeks.
Brace yourself for a wild move in Impala Platinum’s earnings (JSE: IMP)
Even by PGM standards, this is a monster of a swing
Impala Platinum’s trading statement for the year ended June 2026 reflects an astonishing jump in HEPS. They expect to come in between R24.29 and R26.52 per share. In the comparable period, it was just R0.82 per share. That’s an increase of roughly 31x at the mid-point of the range!
There’s obviously a base effect here, particularly as the group was only marginally profitable in the prior year. But there’s also the impact of a far more favourable PGM market, which in turn drove a 51% improvement in achieved revenue per 6E ounce. Add on a 5% increase in refined and scalable production and you get fireworks.
The 8% increase in group unit costs per ounce was no match for the jump in revenue. This is why much of the benefit from higher pricing and production dropped to the bottom line.
Group EBITDA was R43.6 billion and free cash flow was R22 billion. It’s incredible to compare this to the EBITDA of R919 million and free cash flow of R2.35 billion in the comparable period.
Ghost Bite: This is perhaps the ultimate example of how earnings can swing in this sector.
The market celebrated the latest Shoprite update (JSE: SHP)
The JSE’s best retailer closed more than 8% higher on the day
Shoprite has given the market an operational update for the 52 weeks to 28 June 2026. It’s not a detailed set of audited results yet, but there’s plenty of information here for the market to consider. With HEPS up by between 9.7% and 14.7%, Shoprite is doing extremely well.
The company is so big that they don’t just highlight their percentage growth; they also note the incremental rand value of sales. In order to grow sales from continuing operations by 7.2%, they needed to find an additional R18.1 billion to put through the tills. The sheer scale of this thing is extraordinary.
Speaking of scale, Sixty60’s revenue is now up to R25.5 billion (having just grown by 34.5%). It might actually be time for me to retire from serious company analysis and just post revenue numbers on X, if the response to this post is anything to go by:
Momentum throughout the year was incredibly consistent. They grew sales by 7.2% in the first half and 7.1% in the second half. The one area to highlight is Supermarkets Non-RSA, where growth was 12.1% in the first half and 10.0% in the second half. I’m not sure we can read too much into it, but that’s a slowdown in the African countries where Shoprite operates.
Supermarkets RSA is the biggest segment by a country mile (almost 85% of the group), so we will focus there.
Within that segment, like-for-like sales grew by 2.0% vs. internal selling price inflation of 0.8%, so Supermarkets RSA as a whole achieved volumes growth of roughly 1.2%. Note that selling price inflation is way below official inflation, showing how Shoprite can put pressure on its supplier to keep costs down.
There’s also a mix effect here. As we saw at lower-LSM competitor Boxer (JSE: BOX), there’s actually been food deflation in the Shoprite and Usave banners. As the proportion of staples in the basket increases, the level of deflation gets worse (or better, depending whether you’re thinking about it as the retailer or the consumer). Usave’s deflation was -0.6% vs. -0.1% at Shoprite. On a combined basis, the banners achieved growth of 4.3%, with Shoprite LiquorShop’s 10.6% growth as another notable number.
At the other end of the LSM spectrum, Checkers and Checkers Hyper grew 10.0%. Internal selling price inflation was 2.0% for Checkers and 1.2% for Checkers Hyper, so they’ve achieved significant gains in volumes here. Checkers Liquorshop sales were up by a substantial 14.5%!
Off a very small base, the “adjacent businesses” (like Petshop Science) grew by 57.3%. Just wait until you can buy from UNIQ and Little Me as part of your Sixty60 order. It’s clear to me that the group is building a logistics fulfilment layer that will service all the brands over time.
I also wonder about whether medicine will be part of this one day, with Medirite and Medirite Plus growing sales by 12.3%. Transpharm, the wholesale business, was up 7.8%. Sixty60 scooters carrying your pills, anyone?
It can’t all be good news of course. OK Franchise saw the termination of a franchise agreement covering a whopping 51 stores, so the footprint fell from 615 stores to 573 stores. In that context, it’s actually impressive that sales to OK franchise increased by 0.6%.
In case you’re wondering, the disposal of the South African furniture business to Pepkor (JSE: PPH) remains subject to approval by the Competition Tribunal. If you’re a Pepkor shareholder like me, you’ll hope it goes through. If you’re a Lewis (JSE: LEW) shareholder, you’ll certainly be hoping that it gets blocked!
Ghost Bite: Detailed results are due for release on 1 September. I have a timeslot with Pieter Engelbrecht that day, so let me know what questions you would like me to ask.
Nibbles:
- Director dealings:
- A director of Richemont (JSE: CFR) sold shares worth around R42 million. As this is a Swiss company, we don’t know which director it was.
- The CEO of Salungano Group (JSE: SLG) bought shares in the company worth R2.5 million.
- With results out in the wild, Des de Beer is back on the bid at Lighthouse Properties (JSE: LTE). He’s bought shares worth R401k.
- The CEO of Spear REIT (JSE: SEA) bought shares for himself and his family worth around R170k.
- Vodacom (JSE: VOD) announced that chairman Saki Macozoma will retire from the board at the AGM in July 2027. He would’ve been on the board for 10 years by that stage! The current lead independent director, Khumo Shuenyane, will be appointed as chair. As part of other board changes, Vodacom has also announcement the appointment of ex-Airtel Africa CEO Segun Ogunsanya to the board as an independent non-executive director.
- Powerfleet (JSE: PWR) has terminated the employment of CFO David Wilson with immediate effect. He’s being replaced with Paul Lalljie. Wilson will receive a payment equal to 26 weeks of his salary, plus a pro-rated bonus. Oddly enough, the company has also entered into a consultancy relationship with the CFO that they just terminated!
- Sebata Holdings (JSE: SEB) released a trading statement for the year ended March 2026. They expect HEPS to drop by between 94.1% and 95.4%! They attribute this to non-recurring items. I guess shareholders will find out for sure on 14 August.
- Cilo Cybin (JSE: CCC) also released a trading statement for the year ended March 2026. The numbers look crazy because the group recognised a share-based payment expense of R217 million on the reverse acquisition of CC Pharmaceutical. There’s almost no trade in the stock as well. File this one under “companies that probably regret listing”.
