COMPANY NEWS IN BRIEF
Exxaro declares interim dividend
Exxaro Resources has declared an interim dividend of R15.93 per share as earnings grew 75% for the six months to end June.
The company, a major supplier of coal to Eskom with interests in energy and iron ore, reported a rise in earnings mainly due to the strong performance of its coal business driven, by higher sales prices offset by slightly lower sales volumes, due to Transnet's poor railing performance.
Exxaro, like its peer coal producers, has benefitted from record high international coal prices in the first half of the year, driven by the Russian-Ukraine conflict and Indonesia's ban on coal exports, which affected global trade flows and increased European demand for South African coal.
Exxaro on Thursday reported a 77% jump in interim net operating profit to R9.2 billion, up from R5.2 billion in the comparative period. Revenue of R22.3 billion, was up 48% from R15.1 billion. Headline earnings per share grew 75% to R34.26 per share, up from R19.61 per share in the second half of last year. A net cash of position of R5.67 billion compares favourably to a net cash position of R764 million at the end of last year.
Despite inflationary pressures, and thanks to continuous improvements and operational efficiency, the group managed to achieve its cost performance guidance of an increase of below mining inflation.
Presenting her first set of results as Exxaro CEO, Nombasa Tsengwa said the results underscore the resilience of the business through continued delivery against its strategic priorities, as well as its people and management’s ability to respond to logistics challenges, whilst absorbing increasing inflationary pressures through ongoing disciplined cost management.-Fin24
Naspers wants to sell some Prosus shares
Less than two months after Naspers and Prosus announced that they were offloading some of their stake in Chinese tech giant Tencent to buy back their own shares, Naspers said on Wednesday it also wanted to start selling its shares in Prosus. It will use the proceeds to buy back its own shares.
"Subject to the requisite approval of the South African Reserve Bank (SARB) being obtained, Naspers intends to dispose of certain of the Prosus shares that it holds in order to continue to fund the repurchase of Naspers shares pursuant to the repurchase programme," Naspers said in a market update.
Naspers and Prosus previously operated under a cross-holding agreement, which came into effect after a share swap in 2021. Under this, Prosus holds 49% of Naspers ordinary shares, and Naspers owns nearly 57% of Prosus ordinary shares.
A lock-up on the disposal of Prosus shares held by Naspers, as per the agreement, expires on Wednesday.
Naspers said it made an application to the SARB for the approval, and expects a ruling in the coming weeks.
Naspers and Prosus are trading at a large discount to their stake in Tencent. Their plan to offload Tencent shares is aimed at closing the gap. Since June, its shareholding in Tencent has dropped from 28.9% to 28.8%.
"The discount to the group's sum of the parts increased to an unacceptable level. Taking substantive action to reduce the discount is a priority," Naspers said in June.
"The combination of the war in Ukraine, higher inflation and rising interest rates drove up the cost of capital and increased uncertainty," it said. This combined with other factors, including a decline in the valuation of tech companies globally resulted in a decline in the group’s net asset value for the first time in years.-Fin24
Sibanye earnings to halve
Sibanye-Stillwater expects earnings per share and headline earnings per share to halve to between 402c and 447c for the six months to end June compared with 843c in the first half of 2021, representing a decline of 47% to 52%.
The decrease, Sibanye said, is owed to several production problems as well as weaker commodity prices.
Reduced gold production from the South Africa gold operations in the second quarter was due to a wage strike which started on 9 March and was resolved on 13 June.
Added to this, no ore was processed or sold from the Beatrix operations in the first quarter of the year as activities were suspended to allow for the reinforcement of the tailings storage facility.
Production from the group's US Platinum Group Metal (PGM) operations was also significantly impacted in the second quarter by severe regional flooding in Montana in June.
Lower relative precious metals prices, with the average rand 4E (platinum, palladium, rhodium and gold) PGM basket price 19% lower for the first half of the year and the average US dollar 2E (platinum and palladium) PGM basket price 15% lower.
This decline in average commodity prices also resulted in the group recording a 45% decline in share of results of equity-accounted investees after tax compared to the first half of 2021.
These negative financial impacts were partially offset by lower royalties, and mining and income taxes, Sibanye said.-Fin24
Tencent unveils first sales decline
Tencent Holdings logged its first-ever revenue decline after its workforce shrank almost 5%, underscoring the extent to which China’s worsening economy is hurting its biggest corporations.
The country’s most valuable company recorded its first quarterly drop in staffing since 2014, as layoffs rippling through the global tech sector finally hit the WeChat operator. Revenue fell a deeper-than-projected 3% to 134 billion yuan (R326 billion) while net income also missed estimates, plunging 56% to 18.6 billion yuan in the June quarter.
Tencent is grappling with a deepening downturn in the world’s No. 2 economy, the product of a property slump and ad-hoc coronavirus lockdowns from Shanghai to Shenzhen. The uncertainty is wreaking havoc on businesses from advertising to cloud computing and gaming. Alibaba Group Holding Ltd. this month reported its first quarterly revenue drop on record, though the results were better than feared.
Even before the macroeconomic turbulence, China’s giant internet industry had resigned itself to a new era of sedate growth after a decade of free-wheeling expansion. Companies like Tencent are focusing on profitability over the market-grab of years past, after a sweeping government crackdown wiped more than $1 trillion off their combined market value in 2021.
There were some positive indicators. Online advertising revenue slid a record 18% in the quarter, but that was better than analysts feared. And adjusted net income of 28.1 billion yuan was about 15% above expectations. Shares in Prosus, one of Tencent’s biggest backers, slid more than 1% in Europe, and 1.3% on the JSE.
Beijing remains a headache for Tencent. Although regulators resumed approving games in April after a months-long hiatus intended to curb addiction, China’s premier developer has yet to win a nod for a single title this year.-Fin24
Tensions between Caxton, Mpact boil over
Long-simmering tensions between packaging producer Mpact and publishing and printing company Caxton have erupted in recent days.
Caxton owns 34% of Mpact, and wants to take control of the group.
On Friday, Caxton released a statement denying that it had ulterior motives for voting down Mpact's non-executive directors' remuneration policy at a recent annual general meeting.
According to Caxton, Mpact CEO Bruce Strong told investors that the two companies battled to reach an understanding because Caxton had a "different motive".
But Caxton said that was not the case, and that it was "vitally interested" in the success of the package maker.
"Far from having an ulterior motive, Caxton's stated intention to acquire control of Mpact has been met with inexplicable hostility," said the publisher.
Caxton explained that the reasons for its vote were due to Mpact allegedly not sharing enough details regarding an ongoing case, in which the package producer is accused of operating a cartel with its competitor, Golden Era.
Caxton accused the Mpact board of filing "secret representations and affidavits" before the Competition Commission and Tribunal, which it says were "exacerbating concerns held by Caxton that Mpact and Golden Era remain involved in the vestiges of their long-standing cartel".
However, Mpact hit back with its own statement on Wednesday, "strongly" denying Caxton's allegations.
"It has long been a matter of public record and reported in the company's annual financial statements that Mpact is cooperating transparently and in good faith with the Competition Commission regarding the [cartel] investigation initiated in May 2016," said Mpact.-Fin24
Uber, Bolt drivers start Cape Town strike
Uber and Bolt drivers started a strike in Cape Town, demanding lower commission charges and higher rates for drivers.
The strike started on Wednesday and is set to continue through Thursday. The drivers went to the Bolt offices in Cape Town on Wednesday to submit a memorandum of demands.
On Thursday, drivers will submit a memorandum to the office of Cape Town Mayor Geordin Hill-Lewis, demanding that the city expedite the permitting process for e-hailing drivers and to protest alleged racial profiling of drivers and passengers by metro police.
Uber Union chairperson Siyabonga Hlabisa told Fin24 that partner drivers were striking for a better payment system that would raise the income of drivers.
"The main concern is the issue of the commission that we have requested Uber reduce to 10% from 25%." Hlabisa said drivers wanted the platforms to consider increasing the per kilometer rate of payment or changing the payment model such that drivers receive R10 per kilometer.-Fin24
Exxaro Resources has declared an interim dividend of R15.93 per share as earnings grew 75% for the six months to end June.
The company, a major supplier of coal to Eskom with interests in energy and iron ore, reported a rise in earnings mainly due to the strong performance of its coal business driven, by higher sales prices offset by slightly lower sales volumes, due to Transnet's poor railing performance.
Exxaro, like its peer coal producers, has benefitted from record high international coal prices in the first half of the year, driven by the Russian-Ukraine conflict and Indonesia's ban on coal exports, which affected global trade flows and increased European demand for South African coal.
Exxaro on Thursday reported a 77% jump in interim net operating profit to R9.2 billion, up from R5.2 billion in the comparative period. Revenue of R22.3 billion, was up 48% from R15.1 billion. Headline earnings per share grew 75% to R34.26 per share, up from R19.61 per share in the second half of last year. A net cash of position of R5.67 billion compares favourably to a net cash position of R764 million at the end of last year.
Despite inflationary pressures, and thanks to continuous improvements and operational efficiency, the group managed to achieve its cost performance guidance of an increase of below mining inflation.
Presenting her first set of results as Exxaro CEO, Nombasa Tsengwa said the results underscore the resilience of the business through continued delivery against its strategic priorities, as well as its people and management’s ability to respond to logistics challenges, whilst absorbing increasing inflationary pressures through ongoing disciplined cost management.-Fin24
Naspers wants to sell some Prosus shares
Less than two months after Naspers and Prosus announced that they were offloading some of their stake in Chinese tech giant Tencent to buy back their own shares, Naspers said on Wednesday it also wanted to start selling its shares in Prosus. It will use the proceeds to buy back its own shares.
"Subject to the requisite approval of the South African Reserve Bank (SARB) being obtained, Naspers intends to dispose of certain of the Prosus shares that it holds in order to continue to fund the repurchase of Naspers shares pursuant to the repurchase programme," Naspers said in a market update.
Naspers and Prosus previously operated under a cross-holding agreement, which came into effect after a share swap in 2021. Under this, Prosus holds 49% of Naspers ordinary shares, and Naspers owns nearly 57% of Prosus ordinary shares.
A lock-up on the disposal of Prosus shares held by Naspers, as per the agreement, expires on Wednesday.
Naspers said it made an application to the SARB for the approval, and expects a ruling in the coming weeks.
Naspers and Prosus are trading at a large discount to their stake in Tencent. Their plan to offload Tencent shares is aimed at closing the gap. Since June, its shareholding in Tencent has dropped from 28.9% to 28.8%.
"The discount to the group's sum of the parts increased to an unacceptable level. Taking substantive action to reduce the discount is a priority," Naspers said in June.
"The combination of the war in Ukraine, higher inflation and rising interest rates drove up the cost of capital and increased uncertainty," it said. This combined with other factors, including a decline in the valuation of tech companies globally resulted in a decline in the group’s net asset value for the first time in years.-Fin24
Sibanye earnings to halve
Sibanye-Stillwater expects earnings per share and headline earnings per share to halve to between 402c and 447c for the six months to end June compared with 843c in the first half of 2021, representing a decline of 47% to 52%.
The decrease, Sibanye said, is owed to several production problems as well as weaker commodity prices.
Reduced gold production from the South Africa gold operations in the second quarter was due to a wage strike which started on 9 March and was resolved on 13 June.
Added to this, no ore was processed or sold from the Beatrix operations in the first quarter of the year as activities were suspended to allow for the reinforcement of the tailings storage facility.
Production from the group's US Platinum Group Metal (PGM) operations was also significantly impacted in the second quarter by severe regional flooding in Montana in June.
Lower relative precious metals prices, with the average rand 4E (platinum, palladium, rhodium and gold) PGM basket price 19% lower for the first half of the year and the average US dollar 2E (platinum and palladium) PGM basket price 15% lower.
This decline in average commodity prices also resulted in the group recording a 45% decline in share of results of equity-accounted investees after tax compared to the first half of 2021.
These negative financial impacts were partially offset by lower royalties, and mining and income taxes, Sibanye said.-Fin24
Tencent unveils first sales decline
Tencent Holdings logged its first-ever revenue decline after its workforce shrank almost 5%, underscoring the extent to which China’s worsening economy is hurting its biggest corporations.
The country’s most valuable company recorded its first quarterly drop in staffing since 2014, as layoffs rippling through the global tech sector finally hit the WeChat operator. Revenue fell a deeper-than-projected 3% to 134 billion yuan (R326 billion) while net income also missed estimates, plunging 56% to 18.6 billion yuan in the June quarter.
Tencent is grappling with a deepening downturn in the world’s No. 2 economy, the product of a property slump and ad-hoc coronavirus lockdowns from Shanghai to Shenzhen. The uncertainty is wreaking havoc on businesses from advertising to cloud computing and gaming. Alibaba Group Holding Ltd. this month reported its first quarterly revenue drop on record, though the results were better than feared.
Even before the macroeconomic turbulence, China’s giant internet industry had resigned itself to a new era of sedate growth after a decade of free-wheeling expansion. Companies like Tencent are focusing on profitability over the market-grab of years past, after a sweeping government crackdown wiped more than $1 trillion off their combined market value in 2021.
There were some positive indicators. Online advertising revenue slid a record 18% in the quarter, but that was better than analysts feared. And adjusted net income of 28.1 billion yuan was about 15% above expectations. Shares in Prosus, one of Tencent’s biggest backers, slid more than 1% in Europe, and 1.3% on the JSE.
Beijing remains a headache for Tencent. Although regulators resumed approving games in April after a months-long hiatus intended to curb addiction, China’s premier developer has yet to win a nod for a single title this year.-Fin24
Tensions between Caxton, Mpact boil over
Long-simmering tensions between packaging producer Mpact and publishing and printing company Caxton have erupted in recent days.
Caxton owns 34% of Mpact, and wants to take control of the group.
On Friday, Caxton released a statement denying that it had ulterior motives for voting down Mpact's non-executive directors' remuneration policy at a recent annual general meeting.
According to Caxton, Mpact CEO Bruce Strong told investors that the two companies battled to reach an understanding because Caxton had a "different motive".
But Caxton said that was not the case, and that it was "vitally interested" in the success of the package maker.
"Far from having an ulterior motive, Caxton's stated intention to acquire control of Mpact has been met with inexplicable hostility," said the publisher.
Caxton explained that the reasons for its vote were due to Mpact allegedly not sharing enough details regarding an ongoing case, in which the package producer is accused of operating a cartel with its competitor, Golden Era.
Caxton accused the Mpact board of filing "secret representations and affidavits" before the Competition Commission and Tribunal, which it says were "exacerbating concerns held by Caxton that Mpact and Golden Era remain involved in the vestiges of their long-standing cartel".
However, Mpact hit back with its own statement on Wednesday, "strongly" denying Caxton's allegations.
"It has long been a matter of public record and reported in the company's annual financial statements that Mpact is cooperating transparently and in good faith with the Competition Commission regarding the [cartel] investigation initiated in May 2016," said Mpact.-Fin24
Uber, Bolt drivers start Cape Town strike
Uber and Bolt drivers started a strike in Cape Town, demanding lower commission charges and higher rates for drivers.
The strike started on Wednesday and is set to continue through Thursday. The drivers went to the Bolt offices in Cape Town on Wednesday to submit a memorandum of demands.
On Thursday, drivers will submit a memorandum to the office of Cape Town Mayor Geordin Hill-Lewis, demanding that the city expedite the permitting process for e-hailing drivers and to protest alleged racial profiling of drivers and passengers by metro police.
Uber Union chairperson Siyabonga Hlabisa told Fin24 that partner drivers were striking for a better payment system that would raise the income of drivers.
"The main concern is the issue of the commission that we have requested Uber reduce to 10% from 25%." Hlabisa said drivers wanted the platforms to consider increasing the per kilometer rate of payment or changing the payment model such that drivers receive R10 per kilometer.-Fin24
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