| Monday 28 February 2022 Good morning Voornaam,
The JSE has decided not to suspend Oceana's listing based on the lack of its provisional annual financial statements. It sounds like it was a close call. The company has committed to releasing the report by 9th March and I doubt the JSE will give another extension. The CFO is on precautionary suspension pending a disciplinary process and has lodged a grievance. This disciplinary process is apparently not related to the financial information of the company or the subject matter of the investigation. The company won't give details about the CFO's process or the reasons why the CEO left. Oceana has reiterated that the ENSafrica investigation won't implicate any current or former employees and that there is no financial loss to the company.
Wescoal Holdings has "exhausted" the energy component of the Vanggatfontein Colliery. The jokes write themselves, except for those whose jobs are being impacted by Eskom's lack of clarity on t he extension of a coal supply agreement. There are 300,000 tonnes of coal stockpiled at the mine as the original coal supply agreement has reached its ceiling, which is what the company is referencing as being "exhausted" - a situation reached two months ahead of schedule under the 10-year agreement. The mine has been placed on care and maintenance until an extension of the contract can hopefully be agreed with Eskom, as the remaining life of mine is more than 6 years. The stockpile will be processed into the domestic and export market.
Royal Bafokeng Platinum reminded shareholders that the Takeover Regulation Panel is still investigating whether Northam Platinum has triggered a requirement to make a mandatory offer. You may recall that Royal Bafokeng has already received such an offer from Impala Platinum and its independent board has recommended that shareholders accept the offer as it is fair and reasonable. The Impala mandatory offer only closes o n 17th June, so the TRP will need to have concluded its investigation well before then so that Royal Bafokeng shareholders have the full picture.
Advanced Health Limited released results for the six months to December 2021, reflecting ongoing losses in the South African operations and a decrease in profits in Australia. The group seems to be rationalising operations in South Africa and investing more in Australia. The headline loss per share worsened by 30% and there's no dividend.
EPP (the property fund) is disposing of a Power Park in Opole, Poland to a German investment company called Gutenberg Capital. There is only one condition still outstanding and the transaction is expected to close in the next four to six weeks. Hopefully this process won't be derailed by any escalation in the geopolitical crisis in the broader region.
Avengers (investors in Aveng Limited) have been suffering fr om the distortions of technical accounting, something any student in that field can relate to. They took a lot of heart from an announcement that the directors have been buying more shares in the company.
Absa has updated its earnings guidance for the year ended December 2021, noting that HEPS will increase by between 190% and 200% to between 2,120 and 2,193 cents. Normalised HEPS is slightly higher. The share price was trading at nearly R178 in late afternoon trade.
aReit will be listing on the main board of the JSE on the 1st of March and expects to declare its first dividend in April 2022.
Cognition Holdings has swung into a loss-making position in the six months to December 2021, with a headline loss of between 0.41 cents and 0.99 cents per share, compared to HEPS of 2.93 cents in a comparable period. The company attributes this to strategic reinvestment by Private Property, one of th e businesses owned by the group.
I've got two juicy feature articles for you today on companies that are favourite punts for retail investors. The first is Steinhoff, which is embarking on the next phase of its journey to make the business sustainable. The second is City Lodge, which appears to be pricing in a strong return to business travel that I'm not sure is realistic.
In the latest episode of Magic Markets, I had a discussion with my co-host Mohammed Nalla on a variety of market topics. We talked about the volatility in Barloworld as a result of the Russian invasio n of Ukraine, as well as the Tesla vs. Ford debate that we regularly touch on. Listen to it here.
Finally, Chris Gilmour updates us on the latest macroeconomic and geopolitical news from around the world.
Wishing you the best in the markets today,
The Finance Ghost
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