Star 2023-07-13

BUSINESS activity in South Africa is set to be disrupted further on the back of heightened rotational power cuts after Eskom ramped up load shedding to stage 6 indefinitely as demand soars due to the inclement weather. Eskom yesterday started implementing stage 4 load shedding during morning peak hours, which then got ramped up to stage 6 during evening peak hours as a result of loss of generation capacity. The utility said it was forced to shed the load on the grid due to the loss of additional generating units overnight, the extensive use of Open Gas Cycle Turbines, and the inability to replenish pumped storage dam levels. A day before, Eskom noted delays in returning units to service, and increased demand was adding additional strain to…

IT HAS TO be an executive’s worst nightmare: that discussion between fellow executives before an investor call with analysts, talk that is clearly not meant for the ears of investors or shareholders, and it goes live on the internet. Well that’s what happened to RMH’s investor call on Tuesday morning. A conversation between RMH chief financial officer Ellen Marais and CEO Brian Roberts, approximately ten minutes before the scheduled investor call, about a sensitive legal dispute that the investment holding company is involved in, was downloaded by them, probably accidentally, and subsequently, went viral on the internet. Fortunately, in this case, the difference between what Roberts and Marais said was not materially different from what they said in the formal proceedings. On Monday Atterbury Europe was meant to have repaid…

INDUSTRY pundits have welcomed the newly appointed Transnet board chairperson, Andile Sangqu, saying his work experience at the Minerals Council and mining group Anglo American will stand him in good stead to help turn around the struggling logistics utility. Top priorities for Sangqu to tackle is grass roots rail operational efficiency and the financial performance of Transnet. In making the appointment yesterday, Public Enterprises Minister Pravin Gordhan said the “appointments would put Transnet on a firm strategic path that provided critical expertise, experience and acumen for Transnet to optimally and strategically execute on its roadmap”. Industry pundits said the utility, which is in a precarious position with defunct rail systems that have cost the mining industry at least R50 billion a year due to its inefficiency, needs an experienced…

The energy body will have to raise the matter now with the Competition Tribunal AN ALLIANCE of energy transformation organisations has belatedly raised objections against the merger of South Africa’s largest fuel station chain, Engen and JSE-listed Vivo Energy. In February, Malaysian State energy company Petronas sold its majority 74% stake in Engen to Vivo, which is owned by Dutch energy giant Vitol, for an undisclosed sum. The acquisition was in a bid to combine Engen and Vivo’s respective African businesses to create one of Africa’s largest energy distribution companies. The Competition Commission approved the deal on February 9, 2023, after years in the making. Engen’s second-largest shareholder Phembani Group has remained invested as a 21% shareholder in the South African business. However, the Economic Intervention Forum of South…

Of the COMPANIES we research, the tobacco industry has some of the best structural fundamentals. Tobacco consumption is relatively price-inelastic, which means that price increases can make up for falls in sales volumes. Taxes make up a large portion of sale prices. This creates price leverage, causing consumer prices to rise by less than net revenues received by the business when excise rates do not change. In addition, specific taxes in some countries and efficient distribution make it difficult for new entrants to compete on price, especially since marketing is not allowed in most countries. Combine all of this with a business that doesn’t need to reinvest a large portion of its earnings, given a simple product and falling volumes, and you get companies that are able to grow while…

BYTES Technology Group (BTG), a software, security, and cloud services specialist, said yesterday that despite the macroeconomic headwinds in its market, including the invasion of Ukraine, it was a resilient business that benefits from the technological tailwinds. Bytes is listed on the London Stock Exchange (LSE), with a secondary listing on the JSE. In its annual report released yesterday, BTG chairperson Patrick De Smedt said the terrible invasion of Ukraine, which had caused great suffering, showed no sign of ending. “Closer to home, in the UK, we’ve had political and economic upheaval, adding to the sense of uncertainty. However, BTG is a resilient business that benefits from the technological tailwinds, whether it’s migration to the cloud, cybersecurity, or future developments in technology, such as artificial intelligence. “And our market share…