Trading Day – Discovery reports massive increase in earnings. 

Discovery reports a 72% increase in earnings per share (EPS). 

Bowler Metcalf reports a slight decrease in earnings, despite decent revenue growth. 

Here is the biggest news of the day.

  • Discovery reports a massive increase in earnings. Earnings per share (EPS) increased 72% to R8.25. Revenue for the year increased 5% to R77 billion. The company has focused strongly on growing Discovery Bank to scale. For the current year, the bank still lost nearly R1 billion. The company’s strongest performing segments were still from its South African operations, Discovery Life with a 200% increase in profit to R4 billion and Discovery Health with a profit of R3.6 billion. 
  • Bowler Metcalf reports a slight decrease in earnings, despite decent revenue growth. Revenue for the year grew by 6% to R673 million, while earnings per share (EPS) decreased 9% to R1.16. The company attributed lost trading volumes to the July civil unrest, supply chain delays, and load-shedding business interruptions. The company saw a sharp increase in raw materials they could only partially pass along. The company saw increased operating costs attributable to the integration of its new acquisition, SkyePlastics. These processes are complete, however, and their costs are fully accounted for. A final dividend of R0.27 per share was declared, bringing the total dividend to R1.30. This includes a special dividend of R0.84 that was paid earlier in the year.
  • Naspers has received approval from the South African Reserve Bank to sell Prosus shares to fund the repurchase of its own shares.
  • Several Old Mutual directors are purchasing shares. The directors include Iain George Williamson (R3.26 million), Brian Armstrong (R1.26 million), Itumeleng Kgaboesele (R0.36 million), Garth Napier (R0.99 million), Kerrin Land (R0.97 million).
  • Russia’s Gazprom has brought its gas supply to Europe through the Nord Stream 1 pipeline to a complete halt. A Kremlin spokesman said, “Problems in pumping arose because of the sanctions imposed against our country”. While the Kremlin attributes these problems to an inability to have the resources needed for maintenance, many analysts interpret it as a clear indication that Russia is seeking to force Europe to lift the sanctions.
  • Australia’s central bank increased its interest rate by another 0.5% to 2.35%. Royal Bank of Australia targets an inflation rate of 2% – 3%. The country’s last inflation report showed 6.1% inflation, with economists expecting to end the year above 8%.