Here’s what caught our attention on Wednesday:
1. Pepkor results
Pepkor, the company formerly known as Steinhoff Africa Retail (Star), is reporting a 7.0% growth in revenue to R35.3 billion for the six months ended March 31, 2019, while headline earnings per share increased significantly by 39.9% to 50.7 cents. Pepkor says it delivered satisfactory results during the period, in a challenging retail market, adding that consumer spending was under pressure and that political uncertainty, load shedding and the shift of Easter to April contributed to a challenging retail environment. The company says it grew its market share during the period by opening 164 new stores, with stores now totalling 5 332. No dividend has been declared for the period.
2. Famous Brands results
Famous Brands, the owner of food franchises including Wimpy, Debonairs Pizza, Mugg & Bean and others, is reporting a 19% fall in headline earnings per share to 319 cents for the year ended February 28, 2019 on the back of political and economic uncertainty in his home market (South Africa), as well as in the UK where Brexit processes continued. The company’s revenue increased by 2% to R7.2 billion and operating profit fell by 5% to R850 million. The company says across the industry, take away and fast food operators outperformed restaurants and coffee shops as a result of pricing promotions and the appeal of online accessibility and convenience to especially cash-strapped consumers. A dividend of 100 cents has been declared.
3. Vukile Property Fund results
Real estate investment trust, Vukile Property Fund’s total assets amounted to R35.1 billion for the year ended March 31, 2019. The company adds that its direct property investments were valued at R30.5 billion during the period, these investments are located South Africa, Namibia and Spain. Vukile’s exposure within the Spanish market proved to be beneficial as the company says investment properties increased to €916 million from €308 million following the acquisition of five shopping centres. The company’s net profit available for distribution increased by 30% to R1.7 billion and a dividend of 181. 48 cents has been declared, in line with guidance and up 7.5%.
4. Nampak results and negotiations for glass business continues
Packaging company, Nampak issued a cautionary statement on Wednesday, informing shareholders that negotiations relating to the potential disposal of the Nampak glass business are still ongoing with the preferred bidder. Nampak says if negotiations are successfully concluded, the company’s securities will be materially impacted and will be subject to competition approval and depend on the ultimate control structure of the purchaser and its shareholders. Nampak is also due to release its interim results for 2019 on Wednesday.
Update to follow.
5. Ramaphosa’s delayed cabinet announcement
Anticipation around President Cyril Ramaphosa’s cabinet announcement, which was due on Tuesday, but has instead been postponed to later this week is growing. The rand has weakened in response to both the delay and the reappointment of deputy president, David Mabuza. A report from publication, The Conversation, indicates that the delay is impacted by two institutions, namely the ANC’s integrity commission and the public protector’s office. Ramaphosa needs the institutions to help him maintain his drive towards rooting out corruption, making their cases important ahead of announcing his cabinet. The rand this morning was at R14.82 to the dollar at 8:25.