| Thursday 02 December 2021 Good morning Voornaam,
Yesterday was a busy day on SENS. Selfishly, I was happy to see Gold Fields achieving a 52-week high. It's about time that my gold shares improved. I'm 27% up on that company but still in the red on DRD GOLD and Harmony.
I'll start with Etion Limited, a small cap that has come onto the radar in a big way. The company has released interim results for the period ended September. If you split out LAWTrust as a discontinued operation because it was sold to Altron, then revenue grew 181% and gross profit margin increased from 20% to 22% while expenses only increased by 7%. HEPS from continuing operations swung from a loss of 2.59 cents to a profit of 4.16 cents. The share price closed 6.9% higher at R0.31.
Sirius Real Estate is acquiring a business park in the exotically-named Neckartenzlingen, sou th of Stuttgart, for EUR34.5 million. The deal will be financed with existing cash and reflects a net initial yield of 5.6%. This is the ninth asset acquired in Germany this financial year for a total of EUR153.9 million. The fund also entered the UK market in November with the acquisition of BizSpace for GBP380 million.
RMB Holdings, the property business left behind after significant restructuring of the broader RMB - FirstRand stable, has released a trading statement that net asset value (NAV) per share will decrease by between 20% and 25%. There's more to this story than meets the eye though, as there was a special dividend of 80 cents per share that was paid in May 2021 (24% of the NAV at December 2020). The NAV per share at 30 September is expected to be between 252.7 cents and 269.6 cents. The current share price is R1.54.
Hyprop has received the proceeds from the disposal of a property in Serbia. The property wa s owned by Hystead Limited, in which Hyprop holds 60%. The SENS announcement unfortunately doesn't confirm that quantum of net proceeds after adjustments.
Although Luxe made mention of this in its results, the company has released a separate SENS announcement regarding its relationship with Edgards. Retailability saved Edgars from business rescue and has worked with Luxe in rolling out jewellery and watch kiosks in 20 Edgars stores. This was initially on a white-label basis but will now be rolled out as the NWJ brand. The aim is to be in most Edgars stores within South Africa and Namibia by 2023.
Speaking of Namibia, Trustco is having a fight with the JSE over the accounting treatment of certain loan forgiveness transactions. The company is arguing that the JSE is forcing the company to report in a manner that is not in compliance with IFRS. The Financial Services Tribunal has dismissed Trustco's claim. The company will now take the route of a non-binding advisory vote on a wide range of matters, including the accounting treatment as well as strategies to potentially delist from the JSE.
African Equity Empowerment Investments (AEEI) has reported its results for the year ended August. Revenue fell 31.75% and the company had negative operating cash flow of R195.6 million. Despite this, the company is still paying a dividend of 10 cents per share. The cash movement for the year was an enormous drop of over R1 billion, which leaves the group with R2.3 billion in cash.
Today's feature articles cover Implats' offer for RBP, Bidcorp's record quarter despite global disruptions in food service, Emira's portfolio performance update and Santam's announcement of a new CEO and an operational update.
If you haven't listened to Ep 53 of Magic Markets yet, make sure you don't fall behind. With my co-host Mohammed Nalla, we touched on the US and Turkish fiscal situations and discussed the balance sheets of companies like Tongaat, EOH and Brait. Listen to the show here.
Good luck in the markets today!
The Finance Ghost
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