Daily Report 16 November 2022

SA Company News:

The Johannesburg Stock Exchange All-Share Index closed 0.2% higher at the 72 999 level, as gains in mining and industrial shares were offset by losses in financial shares.

Renergen said it has completed repairs to its Virginia plant in the Free State and is already producing liquified natural gas (LNG), expecting commercial deliveries to its customers to commence later this week. The company said that since the repair work was undertaken, the system has been thoroughly tested. The operations team will now focus on the remaining modules to allow the helium liquefaction module to be turned on.

Stor-Age Property REIT Limited reported its interim results for the six months ended 30 September 2022.
The company said that despite the uncertain economic environment and geopolitical instability, Stor-Age continued delivering a strong financial and operating performance for the six months. Rental income and net property operating income were up 18.6% and 16.5% respectively. Same-store rental income was up 9.0% in SA and 11.4% UK. The company declared an interim dividend of 60.05c.

Transaction Capital Limited reported its results for the year ended 30 September 2022. Transaction Capital delivered a strong operational performance in the 2022 financial year with earnings growing in line with historical growth rates. Core earnings from continuing operations attributable to the group
increased 24% to R1 246 million. Basic earnings per share from continuing operations attributable to the group decreased 31% to 232.0 cents. CEO David Hurwitz said that WeBuyCars delivered the most profit with close to two-thirds. The company declared a final dividend of 37 cents per share.

Equites Property Fund said that Shoprite has appointed them to develop a R1.24 billion logistics warehouse facility in Ekurhuleni. Equites will develop the 92 791m2 warehouse facility and has also concluded an initial 20-year triple net lease agreement, which means the tenant pays maintenance costs, taxes and insurance costs in addition to rent. The lease is expected to commence at the beginning of July 2024.

In a trading update from PPC Ltd for the six months ended 30 September 2022, that company reported that revenues increased by 4% and EBITDA decreased by 28.5% from R515 million to R368 million for the current period. Earnings per share for the group, for the current period, is expected to be a loss of
between 7 cents and 11 cents per share, compared to the 61 cents per share profit for the prior period. Headline loss per share for the current period for the group is expected to be between 4 cents per
share and 8 cents per share, compared to the 42 cents per share profit for the prior period.
PPC group said it continues to deliver sound cash generation and deleverage the balance sheet despite difficult trading conditions in its core South African and Botswana cement market.
Woolworths Holdings Limited trading update for 20 weeks ended 13 November 2022 said that the group’s turnover and sales increased by 23.3%. Online sales however, declined by 13.7%, contributing 10.1% to the group’s total turnover and sales over the period. Shareholders are therefore informed that earnings per share (EPS) and headline EPS (HEPS) are expected to be more than 20% higher.

SA Economy:
The latest TransUnion SA Consumer Credit Index (CCI) showed that consumer credit health deteriorated further in the third quarter. The CCI fell one point in the third quarter to 48, amid high inflation and interest rates. The index measures the health of consumer credit, with 50 the midway point between improvement and deterioration.
The Standing Committee on Public Accounts (SCOPA) wants an update on the SAA deal after Gidon Novick resigned as the CEO and board member of Takatso Consortium, which plans on buying the airline, but the Public Enterprises Department says it cannot divulge details or an update on its deal with the consortium. It says this is due to the commercially sensitive nature of the deal that is still in progress.

Global Economy:
The U.K. unemployment rate edged higher to 3.6% in September, while average earnings rose 5.7% on the month.
The Eurozone economy expanded 0.2% on quarter in the three months to September of 2022, in line with estimates. The reading reaffirms a slight expansion in the euro area economy in the third quarter.
The annual inflation rate in Nigeria accelerated for the ninth straight month to 21.09% in October 2022 from 20.77% in September, even after a recent 150 bps interest rate hike by the central bank.
The US Producer Price Index for final demand in the US rose 0.2% month-over-month in October 2022, below market forecasts of 0.4%. The report showed that PPI came in softer than expected on a year-on-year basis and in its core reading.

Global Company:
The FTSE 100 closed 0.21% lower at 7 369.
Vodafone shares fell 5.6% after the company cut its full-year free cash flow forecast and said earnings would come in towards the bottom of its range.
Credit Suisse shares fell 0.5% after the Swiss bank agreed to sell a significant part of its securitized products group and other related financing businesses to Apollo Global Management, as it seeks to restructure its business.
Hong Kong stocks slipped as Chinese tech giants wavered before earnings reports from Tencent Holdings and Alibaba Group. Tencent has reportedly started a new round of lay-offs before its third-quarter report due later today. Alibaba will release its second quarter earnings tomorrow.
The Hang Seng Index is lower by 1.06% to 18 161.
In China, the Shanghai Composite is down 0.33% to 3 123.
Tencent Music Entertainment Corp reported a 5.6% fall in quarterly revenue, as weak advertising and paying user growth hurt the Chinese audio streaming platform. Total revenue fell to $7.37 billion yuan ($7.37 billion) in the quarter ended 30 September from $7.81 billion yuan a year earlier, compared with analysts’ average estimate of $7.07 billion.
The Dow Jones Industrial Average rose by 0.17% to 33 592, while the S&P 500 climbed 0.87% to 3 991.

Commodities:
Gold is up 0.17% to $1 773/oz, while Platinum is lower by 0.63% to $1 024/oz.
Brent crude was 0.6% higher at $93.34 a barrel.

Currencies:
The rand traded at R17.34 against the US Dollar, R20.56 against British Pound and R17.98 against the Euro.
The Euro is slightly firmer against the US Dollar to trade at $1.0367.