Ghost Bites: Vol 3 (22)

Kaap Agri has released interim results, reflecting revenue growth of 26.7% and growth in recurring HEPS of 15%. Fuel price increases haven’t helped the fuel retail operations, as volumes have dropped and higher fuel prices don’t do any favours to margins. There are other great insights in the result, like the outlook for fruit exports and the impact of inflation on balance sheets. I’ve covered all of this in a feature article that you should read here.

Pan African Resources has commissioned a 10MW solar PV plant at Evander Gold Mines and has plans to take its group solar PV generation capacity to 30MW by 2024. It’s so great to see this kind of investment in South Africa that I dedicated a feature article to this news.

Property fund Octodec Investments is focused on inner-city properties (including residential) and has released interim results for the six months to February 2022. Rental income increased 5.1% and like-for-like rental growth was 1.2%. Distributable income after tax was 6.4% higher and a dividend of 50 cents per share was declared vs. no dividend in the comparable period. Loan to value (LTV) ratio has improved from 43.2% to 41.0%. Net asset value (NAV) per share has decreased 0.4% to R23.10 and the share price closed 3% higher at R8.55 (a gigantic discount to NAV). The company has not provided any guidance for the second half of the year due to the uncertain environment.

In another example of a “value” unlock on the JSE, Grand Parade Investments (GPI) will be unbundling its 9.28% stake (or is that steak?) in Spur to shareholders. This works out to value of 37 cents per GPI share and helps reduce the discount to intrinsic net asset value that GPI trades at. Simply, this is a problem where investment holding companies (especially those that hold positions in other listed companies) trade at a lower value than the implied value if you just add up the assets and subtract all debts. GPI closed at R2.63 per share.

Raubex has released a further trading statement related to the year ended February 2022. The expected earnings range is even higher, with HEPS expected to be between 258% and 268% higher than the prior year. The HEPS range is 293.2 cents to 301.4 cents, with the share trading at around the R42.50 mark in morning trade. This is a Price/Earnings multiple of around 14.3x at the mid-point of the guidance.

Australian property group Irongate has released results for the year ended March 2022. Headline earnings per security (as share isn’t the correct technical term for this Australian structure) was A$0.4115 and the net tangible asset value per security is A$1.74. The group is currently under offer from Charter Hall for A$1.90 per security.

Share buyback programmes have become a popular way to return cash to shareholders and drive growth in Headline Earnings Per Share (HEPS) – provided that the shares are bought back at an earnings-accretive price! Companies like Reinet Investments, South32, Pan African Resources, Glencore and British American Tobacco released announcements on Tuesday updating the market on their share buyback activities.

Standard Bank has announced Ms Nonkululeko Nyembezi as the new “Chairman designate” of the board. Considering “she” and “her” appears all over the announcement, I was initially taken aback that the title “Chairman” was still used (vs. “Chair” or “Chairperson” as neutral options or “Chairwoman” for that matter). After a discussion on Twitter, a follower pointed out to me that “Chairman” is a reference to the “chair of the mandate” and not the gender of the person in the role. Although this view was supported by a number of people in the thread, I was unsuccessful in fact checking it online. Interesting!

NEPI Rockcastle has migrated from the Isle of Man to Luxembourg and has been granted conditional approval to subsequently migrate from Luxembourg to the Netherlands, moving the domicile of the company into the EU. Interestingly, there are no Luxembourg audit firms accredited with the JSE, so the local exchange granted a dispensation to NEPI Rockcastle for a period of four months. The company must still have an auditor of course, so the dispensation simply relates to whether that auditor is accredited with the JSE.

A PMDR (Person Discharging Managerial Responsibilities) of Gemfields has sold shares to the value of R11.2 million in the company.

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