• Market Watch

Company News in Brief

• 2 Days Ago

Astral pays dividend after scratching its way back from annus horribilis



SA's largest poultry producer Astral Foods reintroduced its dividend after swinging back into a profit following the worst loss in its history last year.

The owner of County Fair and Goldi reported a 6% climb in revenue to R20.5 billion in its year to end September, when its headline earnings jumped to R738 million, from a loss of about R508 million. This enabled it to declare a dividend of a final 520c per share after electing not to pay one in the previous year, nor an interim dividend for the current year.

Astral was bouncing back from SA's worst bird flu outbreak on record, while the cessation of load shedding meant it wasn't haemorrhaging money on diesel.

Load shedding in the previous year had also created the so-called "fat chicken" crisis for Astral, as power interruptions caused significant delays in slaughter programmes. Because birds were in the system for longer without being slaughtered, chickens ended up being far bigger than usual, creating problems with fast-food groups, which prefer very specific proportions.-FIN24



PPC pleased with stronger margins, pushes turnaround to 'awaken the giant'



SA's biggest cement producer PPC said on Monday it is pleased with improved margins, even as it faced volume and revenue pressure in its key markets of SA and Zimbabwe. The cement producer said it was also pleased with the speed of a turnaround to "awaken the giant" after acknowledging that even as its faces tough competition, it has failed to fully leverage the potential of its high-quality asset base.

The cement producer reported on Monday that its revenue slipped 4.2% to about R5 billion in its six months to end September, and core profit 0.6% to R796 million. It felt volume pressure, but its core profit margin improved to 15.7% from 15.1%, with improvements in both SA and Zimbabwe.

The group's SA and Botswana business grew core profit by 5.9% to R394 million, though volumes fell 5% amid a decline in retail or bagged cement sales as bulk cement sales increased. While retail demand is relatively flat period-on-period, aggressive pricing from some competitors drove the lower sales volumes, the group said.

In Zimbabwe, core profit fell 6.3% to R402 million, with volumes falling just over 9%, reflecting market share adjustments after imports were banned in the prior comparative period. Margins still improved 1.5 percentage points to 26.1%.-FIN24



Novus makes R750m cash offer for ICT firm Mustek



JSE-listed printing group Novus Holdings announced on Friday it, along with directors of Mustek, intends to make a takeover offer that values the equipment and services group at almost R750 million.

Mustek, who announced that Novus had built up a stake of above 35% in it, a threshold that requires a mandatory offer, also saw its shares leap almost 10% to R15, above the R13-per-share offer from Novus. Novus lifted almost 3% on Friday and has gained about 92% on a one-year basis.

Mustek, now valued at about R863 million on the JSE, was founded in 1987 and has branched out into cloud and cybersecurity solutions, networking equipment, and sustainable energy.

Novus, valued at about R2.8 billion, is one of SA's largest printing and manufacturing groups, and it recently also acquired three Media24 divisions for R43 million, which entails a distributions business, On the Dot; its community newspaper portfolio; as well as football-focused Soccer Laduma and Kick Off.

It had a net cash pile of about R460 million as of the end of March, while it recently flagged a between 96.3% and 116.3% rise in its headline earnings per share for its six months to end December, from 28.77c, or R92.3 million previously. It had said it benefitted from orders received during the period under review, which were historically processed in the second half of the year, and from profits from derivative instruments. -FIN24



Why WeBuyCars CEO believes 40% of cars sold in SA could be Chinese by 2028



WeBuyCars believes Chinese manufacturers could gain up to 40% of the new car market by 2028 as they make rapid inroads locally with affordable vehicles.

Speaking to News24 after the release of full-year results on Monday, the listed second-hand vehicle dealer's CEO, Faan van der Walt, noted how the new Chinese entrants coming to market were "well-priced and offering good value for money".

At the same time, the quality of the cars had been improving and they were keeping their value, he said.

Chinese brand GWM entered the SA market in 2007, with Chinese government-owned BAIC opening a SA factory in Coega in 2018. Among the recent new entrants are Jetour, which is owned by Chery, and Omoda.

Considering the rapid growth in share gains over the past two years, Van der Walt said a conservative estimate could see Chinese vehicle makers capturing at least 25% to 30% of the market by 2028, although it could be as high as 40%.

This of course spells trouble for some of the established local vehicle players, who will likely give up some market share, he added.

He expected Toyota and Suzuki to continue to do well even as some of Toyota's models such as the Hilux and Fortuner become a "bit long in the tooth". -FIN24



WeBuyCars posts record sales, shares have now doubled since listing



Shares in used-vehicle dealer WeBuyCars gained more than a percentage point on Monday morning after the company reported a boost from selling prices and sales volumes.

Its share price has now almost doubled since its listing on the JSE in April – from R20.40 to above R40.

Group revenue increased 16.5% to R23.3 billion in the year to end September, with vehicle sales volumes rocketing more than 16% and a record 14 594 units sold in July.

Over the past year, the group purchased 167 741 vehicles, an 18% increase on last year, while it sold 165 185, a 16% increase and a new record for the group.

While its headline earnings – SA’s main profit measure – declined by almost 60%, the group said this was distorted by two once-off costs. The first was the R45 million it spent to list on the JSE in April, following its unbundling from Transaction Capital. The second was a loss of R427 million on a call option, which gave it the right to buy a 25% stake in the group from the WeBuyCars founders.-FIN24



Nedbank plots expansion in Africa with R12bn war chest



Nedbank Group is setting out to reinvent itself across the African continent as it looks to reduce its dependence on South Africa and nearly quadruple its profit from other African markets over the next decade.

Armed with a war chest of R12 billion ($662 million) in excess capital sitting on its books by end of June, South Africa’s fourth-largest lender by assets has mapped out a strategy to build scale in booming sectors such as natural resources and renewable energy. The bet is that these opportunities across the continent will drive a transformative shift in its revenue mix.

Currently, over 90% of Nedbank’s profits come from South Africa, but the bank has set an ambitious target to generate just under half of its earnings from other African markets within five to ten years — a leap from the current 9.2%.

“We can easily get between 20% to 30%, and even closer to 40% if we grow in the manner that we aspire,” Terence Sibiya, group managing executive for Nedbank Africa Regions, said in an interview. Nedbank will be a different bank by 2029, Sibiya said. -MONEYWEB