South Africa

Trading Day – Bidvest posts healthy increase in earnings and dividends.

Bidvest posts a healthy increase in earnings per share (EPS) to R14.92 and declares a final dividend of R3.64.

AVI reports a reasonable headline earnings per share (HEPS) increase to R5.30.

Here is the biggest news of the day.

  • Bidvest posts a strong increase in earnings and dividends. Revenue for the year increased 13% to just under R100 billion. Earnings per share (EPS) increased 32% to R14.92. Bidvest noted that 6 of its seven divisions delivered an excellent trading profit, improving on a base that had already rebounded strongly from the pandemic. The company declared a final dividend of R3.64, bringing the total dividend for the year to R7.44, up 24% from last year.
  • AVI reports a reasonable increase in earnings. Revenue for the year increased by 4%, while headline earnings per share (HEPS) increased by 6% to R5.30. AVI noted strong headwinds from rising food commodity and fuel prices but says it was able to protect gross margins through price increases and a strong hedging program. The company declared a final dividend of R2.92 per share.
  • RCL Foods’ earnings remain relatively flat. Earnings per share (EPS) for the year increased only 2% to R1.14, despite an increase in revenue of 10% to R34.9 billion. Management was pleased with the results, commenting that it showed resilience in a challenging operating environment. Key drivers of the results were strong momentum in the Sugar division and a return to profitability in the Rainbow Chicken division. The company declared R0.30 per share to bring the total dividend for the year to R0.45, in line with last year.
  • The Rand has weakened significantly in the past week, going from R16.84 to the Dollar to R17.40.
  • MTN settles $300 million of debt early as part of its strategy to deleverage non-rand debt faster. The bonds were due in November 2024.
  • Renergen switches on Virginia gas plant. The company has successfully used the system and has commenced filling bulk storage tanks to begin the delivery of products to customers. They will now focus on ramping up operations to full Phase 1 capacity over the coming months.
  • Jubilee Metals’ Roan Copper project achieves nameplate capacity following the successful commissioning and ramp-up of the operations. Project Roan is a core component of the Company’s Zambian Southern Copper Refining Strategy which aims to produce 12 000 tons of copper per annum through the Sable Refinery.
  • The US jobs report still indicates strong growth, but slowing wage growth indicates potential inflation easing. 315 000 new jobs were added in August compared to 300 000 expected. This is, however, significantly lower than the 526 000 jobs added in July. Total employment is 240 000 jobs higher than pre-covid levels. The unemployment level rose to 3.7%, offset by a higher labour participation rate. Average hourly earnings rose 5.2% year-over-year, in line with last month’s report. Every month wage growth was only 0.3%, below expectations of 0.4%.
  • Bed Bath & Beyond’s CFO, Gustavo Arnal, falls to his death from New York’s Jenga tower.  The New York City medical examiner’s office considers it a suicide. Arnal and major shareholder Ryan Cohen were sued over accusations of artificially inflating the firm’s stock price in a “pump and dump” scheme involving meme-stock traders, alleging Arnal sold off his shares at a higher price after the scheme. Arnal sold 55 000 shares in Bed Bath & Beyond in multiple transactions in August. The sales amounted to about $1.4 million, and Arnal still had almost 255,400 shares remaining. Last week, Bed Bath & Beyond said it would close 150 stores and cut jobs to reduce its money-losing business.

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