Company news in brief
Pepkor grows profit by 28%
Pepkor grew its headline earnings per share by 28% to 91.5 cents in the six months to end-March, with revenue up 3% to R42 billion. The Pep and Ackermans owner did not declare an interim dividend.
Pepkor said it achieved "ongoing organic growth" thanks to its store expansion programme, with another 144 new stores opened in the period, pushing its global store footprint to 5 708 at the end of March. It still plans to open 300 stores altogether in the financial year.
It said its newly acquired Brazilian retailer Grupo Avenida’s operating performance "exceeded expectations".
"Good progress was made in preparing the business for growth, while improved working capital, in particular inventory levels, supported sales performance. Avenida currently operates 130 stores."
Pepkor said the results excluded the benefit of the global settlement by its majority shareholder Steinhoff, which amounted to R429 million, or 12 cents per share. Its exposure came through management investment company, Business Venture Investments, which was invested in Steinhoff shares. Pepkor provided a financial guarantee, which was converted to a loan in 2020. – Fin24
Mr Price reports earnings jump
Strong retail sales growth and the acquisition of kitchenware company Yuppiechef and value retailer Power Fashion are major factors in an expected jump in earnings for Mr Price.
In its trading statement for the 12 months to 2 April, Mr Price said it expects a 17% to 22% jump in headline earnings per share, to at most 1302.8 cents.
Mr Price said it expected to show at the release of its interim results on 9 June that it had strong annual retail sales growth and a "solid operating performance", despite last year July 2021, which resulted in the looting of 111, or 7%, of the group’s 1 592 stores.
The gains from the insurance proceeds were added to the headline earnings per share, but will not contribute "a material proportion of the difference between growth rates in basic and headline earnings."
Claims for business interruption losses relating to the unrest are still being assessed and Mr Price expects to receive the proceeds in the 2023 financial year. – Fin24
African Bank eyes growth in business banking
African Bank has bought Grindrod Bank to cement its recent entry into business banking. The bank announced on Thursday that it has acquired 100% of Grindrod Bank, a subsidiary of the JSE-listed shipping giant that has been operating as an investment bank in SA for 28 years.
The deal is worth R1.5 billion. Grindrod Bank has a big corporate and business banking customer base in SA who had deposited just over R11.2 billion with it at the end of 2021.
Over and above the typical corporate and SME lending products business bankers have, it has a specialised property finance division for the commercial and industrial property that offers bridging finance for landlords over and above mortgage loans. So, Grindrod Bank will also provide a strong entry point for African Bank into the property finance market.
Grindrod Bank CEO David Polkinghorne said the bank has had several suitors over the years. Other investors have possibly been watching how it has carved its niche in the highly contested business banking space in SA.
It was already a sizeable and "core" business for Grindrod Limited. It contributed R97 million to the group's core headline earnings in 2021 – a portion equal to 13.7% of the group's adjusted headline earnings. – Fin24
HCI posts strong profit recovery
Following a week of confusion – where the group released two wildly different profit updates within a day of each other – Hosken Consolidated Investments (HCI) reported strong results on Friday.
Its income for the year to end-March, increased by 36% to R19.1 billion, while its headline profit per share jumped to R13.21 - up from R2.87 in the previous financial year. Due to the impact of the Covid-19 pandemic on the group's operations and the requirement to preserve cash resources, the board, however, decided not to declare a final dividend.
HCI's major shareholder is the South African Clothing and Textile Workers Union. The group's investments include in eMedia, Tsogo Sun, VSlots, and Deneb.
In addition to other oil and gas exploration holdings, HCI also has an indirect stake in an oil find block off the Namibian coast being developed by, among others, Total.
According to analyst Anthony Clark of Small Talk Daily Research it is this option the group has that is keeping its share price up.
"If it did not have the oil find, its share price would be fundamentally overpriced," Clark said. HCI’s share price has jumped 175% over the past year. – Fin24
Pepkor grew its headline earnings per share by 28% to 91.5 cents in the six months to end-March, with revenue up 3% to R42 billion. The Pep and Ackermans owner did not declare an interim dividend.
Pepkor said it achieved "ongoing organic growth" thanks to its store expansion programme, with another 144 new stores opened in the period, pushing its global store footprint to 5 708 at the end of March. It still plans to open 300 stores altogether in the financial year.
It said its newly acquired Brazilian retailer Grupo Avenida’s operating performance "exceeded expectations".
"Good progress was made in preparing the business for growth, while improved working capital, in particular inventory levels, supported sales performance. Avenida currently operates 130 stores."
Pepkor said the results excluded the benefit of the global settlement by its majority shareholder Steinhoff, which amounted to R429 million, or 12 cents per share. Its exposure came through management investment company, Business Venture Investments, which was invested in Steinhoff shares. Pepkor provided a financial guarantee, which was converted to a loan in 2020. – Fin24
Mr Price reports earnings jump
Strong retail sales growth and the acquisition of kitchenware company Yuppiechef and value retailer Power Fashion are major factors in an expected jump in earnings for Mr Price.
In its trading statement for the 12 months to 2 April, Mr Price said it expects a 17% to 22% jump in headline earnings per share, to at most 1302.8 cents.
Mr Price said it expected to show at the release of its interim results on 9 June that it had strong annual retail sales growth and a "solid operating performance", despite last year July 2021, which resulted in the looting of 111, or 7%, of the group’s 1 592 stores.
The gains from the insurance proceeds were added to the headline earnings per share, but will not contribute "a material proportion of the difference between growth rates in basic and headline earnings."
Claims for business interruption losses relating to the unrest are still being assessed and Mr Price expects to receive the proceeds in the 2023 financial year. – Fin24
African Bank eyes growth in business banking
African Bank has bought Grindrod Bank to cement its recent entry into business banking. The bank announced on Thursday that it has acquired 100% of Grindrod Bank, a subsidiary of the JSE-listed shipping giant that has been operating as an investment bank in SA for 28 years.
The deal is worth R1.5 billion. Grindrod Bank has a big corporate and business banking customer base in SA who had deposited just over R11.2 billion with it at the end of 2021.
Over and above the typical corporate and SME lending products business bankers have, it has a specialised property finance division for the commercial and industrial property that offers bridging finance for landlords over and above mortgage loans. So, Grindrod Bank will also provide a strong entry point for African Bank into the property finance market.
Grindrod Bank CEO David Polkinghorne said the bank has had several suitors over the years. Other investors have possibly been watching how it has carved its niche in the highly contested business banking space in SA.
It was already a sizeable and "core" business for Grindrod Limited. It contributed R97 million to the group's core headline earnings in 2021 – a portion equal to 13.7% of the group's adjusted headline earnings. – Fin24
HCI posts strong profit recovery
Following a week of confusion – where the group released two wildly different profit updates within a day of each other – Hosken Consolidated Investments (HCI) reported strong results on Friday.
Its income for the year to end-March, increased by 36% to R19.1 billion, while its headline profit per share jumped to R13.21 - up from R2.87 in the previous financial year. Due to the impact of the Covid-19 pandemic on the group's operations and the requirement to preserve cash resources, the board, however, decided not to declare a final dividend.
HCI's major shareholder is the South African Clothing and Textile Workers Union. The group's investments include in eMedia, Tsogo Sun, VSlots, and Deneb.
In addition to other oil and gas exploration holdings, HCI also has an indirect stake in an oil find block off the Namibian coast being developed by, among others, Total.
According to analyst Anthony Clark of Small Talk Daily Research it is this option the group has that is keeping its share price up.
"If it did not have the oil find, its share price would be fundamentally overpriced," Clark said. HCI’s share price has jumped 175% over the past year. – Fin24
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