Trading Day – Standard Bank posts record earnings and big dividend increase.

Standard Bank reported record earnings coupled with solid growth in assets, which resulted in a huge dividend increase of R5.15 per share.

Fortress fails in a bid to collapse the dual share structure, putting it at risk of losing its REIT status. 

Here is the biggest news of the day.

  • Standard Bank achieved record earnings “underpinned by continued balance sheet and franchise growth.” The group’s half-year results showed a growth in Net Asset Value grew of 15%. Earnings per share increased by 34% to R9.61, and Return on Equity (ROE) rose from 12.9% last year to 15.3%. The company declared an interim dividend of R5.15 per share, up 43% from last year.
  • Fortress fails in a bid to collapse the dual share structure putting it at risk of losing its REIT status. While the proposed scheme was supported by more than 60% of shareholders at the general meeting, it failed to achieve the approval threshold of 75%, so the resolution did not pass. The scheme would have seen the discontinuation of the company’s class A share, leaving the class B share as the only one in circulation and giving Fortress more freedom in how it pays distributions of income. The current restrictions put the company at risk of losing its REIT status since it prevents Fortress from paying the required minimum distribution that is needed by the JSE to be classified as a REIT.
  • Prosus acquires the remaining 33% stake in iFood from Just Eat for €1.5bn in cash. The implementation of the transaction is subject to approval by the Just Eat shareholders. According to the financial statements of Just Eat, the value of the carrying amount of Just Eat’s interest in iFood was €1.744 billion.
  • Blue Label Telecoms expects a good earnings increase. The company released a trading statement declaring an expected earnings per share (EPS) of roughly R1.17, an increase of around 24%.
  • Buffalo Coal Corporation declares a loss despite a moderate increase in revenue. The company posted a half-year loss per share (LPS) of R0.04, much smaller than last year’s R0.13 per share. Revenue increased by 7% to R187.3 million.
  • President Joe Biden continues to fight oil producers despite encouraging them to produce more. In a legal win the president had his permission to freeze all oil and gas leasing on federal land temporarily reinstated, after the US Appeals Court overturned a trial judge’s order against the moratorium.
  • Turkey surprises market with rate cut despite 80% inflation rate. In a move deemed economic suicide by many, the country’s central bank cut rates from 14% to 13%. Their central bank committee explained the move in a statement, saying that they expect the “disinflation process to start” and that they see signals of a “loss of momentum in economic activity.”