Star 2023-04-19

CAPITEC lifted headline earnings 15% to R9.7 billion in its 2023 financial year and raised the dividend by the same percentage to R42 a share as the digital bank crossed the 20 million client mark for the first time, or nearly a third of the local population. Despite good earnings growth, the share price fell 4.52% to close at R1 670 on the JSE yesterday. ThePassiveIncomeGuy (@hazelwood_dave) commented on Twitter: “Capitec. Their non-performing loans has shown a worrying increase. Capitec management says this is worse than they expected. Bear in mind the full effects of higher interest rates, inflation and load shedding will only show this year.” Wayne McCurrie (@wayneMcCurrie) tweeted: “Capitec results. Earnings up 15%. Disappointing at a 22 P/E ratio. Share down 5%.” Operating profit…

THE ONGOING energy crisis in South Africa is expected to continue dragging business confidence lower in the months ahead as sentiment fell to a four-month low in March. The South African Chamber of Commerce and Industry (Sacci) said yesterday that the business confidence index (BCI) fell by 0.6 index points to 111.3 points in March, from 111.9 points in February. This was the lowest that the BCI has been since November 2022 when it was 110.9 points. Sacci said the negative month-to month impacts of the declining real value of building plans passed, lower JSE share prices, and rising real interest rates were of concern to business prospects going forward. From February to March, Sacci said the business environment experienced a rather mixed state of affairs with…

Going aggressively after clients who owe it billions in outstanding loans THE LAND BANK has decided to approach the National Treasury and ask it to help with conducting a forensic investigation of third-party agents who were disbursing and managing more than R10 billion debt owed to it in bad loans. This comes after the Land Bank aggressively went after clients who are owing it billions of rand in outstanding loans after it resumed new lending activities to commercial farmers after a two-year hiatus. Non-performing loans are part of the reasons why the cash-strapped bank entered a serious liquidity crisis when it failed to make interest payments due on its R50bn borrowings in April 2020, triggering a cross default on substantially all of its borrowings. Land Bank chairperson Thabi Nkosi…

FINANCE Minister Enoch Godo- ngwana has maintained his position that Eskom will not be investing any capital expenditure in new generation capacity for the next three years as part of the government’s R254 billion debt-relief programme. Briefing the Parliament’s Standing Committee on Finance yesterday, Godongwana reiterated that Eskom’s capital expenditure was restricted to transmission and distribution. According to the debt-relief programme, the first condition for Eskom is that only capital expenditure that may be undertaken for generation relates to minimum emissions standards, flue-gas desulfurisation and required maintenance. No other greenfield generation projects will be allowed during the debt-relief period. EFF MP Floyd Shivambu asked Godo- ngwana to justify the logic of not investing in generation capacity on the back of Eskom’s failure to meet electricity demand and implementing stage…

AFRIMAT’S headline earnings per share is expected to fall 13% to 18% for the year to February 28, but the mid-tier mining group remains debt free and well capitalised to be able to execute its growth strategy. The share price slipped 2.97% to close at R49 on the JSE yesterday, some 27% below the R66.60 that it traded at a year ago. The construction materials, industrial mineral and bulk commodities mining group said in a trading statement yesterday that earnings per share were expected to decrease by between 15% and 20% compared to 560.7 cents for the year ended February 28, 2022. Headline earnings per share were expected to be between 445.2c and 472.3c, representing a decline of between 13% and 18% compared to 542.9c for the last financial…

I WAS FORTUNATE enough to attend the South Africa Investment Conference 2023 (SAIC), organised by The Presidency, Invest SA and the Industrial Development Corporation. It is safe to say that the overwhelming message was that South Africa is a “diamond in the rough”. Multiple themes came up relating to infrastructure, energy security, logistics networks, co-operation between the State and the private sector, among others. The list of the most urgent reforms needed in the public sector to unlock investment opportunities, confidence and investor interest in South Africa is well understood. The themes aren’t new, but it is important to re-emphasize them as they are critical enablers of the economy. I suspect most attendees were surprised when Human Settlements Minister Mmamoloko Kubayi, who also happens to chair the ANC NEC Economic…