Daily Report 22 November 2022

SA Company News:
The Johannesburg Stock Exchange All-Share Index closed 0.9% lower at the 71 938 level, mainly pushed lower by resources, tech companies and industrial shares.
Barloworld said that they would unbundle its stake in car-hire firm Avis SA and list its car rental and leasing business, which includes Avis and Budget, separately on the JSE as the Zeda Group next month. The Zeda Group will list on the main board of the JSE on the 13th of December. Barloworld shareholders will receive one Zeda share for every one Barloworld ordinary share held.
PPC Ltd reported results of the six months ended 30 September 2022. The company said that group revenue increased 9% to R4 248 million, headline earnings per share decreased from 10 cents to 4 cents and profit before tax increased by 4% from R250 million to R259 million., CEO, Roland van Wijnen said
that the group will continue to improve cash generation and operational efficiencies in an effort to further strengthen its financial position and reduce the impact of rising input cost inflation.
In a trading update from Naspers, the company said that earnings per share, for the first half of 2023, is expected to drop significantly on macroeconomic pressures and lower profits, though its e-commerce businesses maintained strong top-line growth momentum. Earnings per share is expected to fall by between 81% – 88% and core headline earnings per share for the six months, ended September 2022, is expected to decrease by between 235 and 206 cents per share (between 59.7% and 52.3%). The significant decrease in earnings per share relates to a gain of US$12.3bn realised on the sale of a 2% interest in Tencent in the prior year compared to an expected gain of only US$2.8bn on the sell down of Tencent shares in the current period.
Prosus said in a trading statement that they expect earnings for the six months to end September 2022 to have dropped by at least 79.9% from the same period last year. The company said businesses had strong sales growth in the period, but earnings were hit by investment costs and lower contributions from companies in which it holds significant stakes, including China’s Tencent.
Coronation Fund Managers limited reported financial results for the year ended 30 September 2022. Revenue decreased by 12% to R3 738 million from R4 263 million in the prior corresponding period. Headline earnings per share decreased by 25% to 366.3 cents per share and earnings per share decreased also by 25% to 366.3 cents per share, from 487.9 cents. The company declared a final gross dividend of 172 cents per share from income reserves in respect of the year ended 30 September 2022.
Pepkor Holdings Limited also reported their annual results for the year ended 30 September 2022. The company said that revenue grew 5.3% to R81.4 billion, coming off a high base. Headline earnings per share increased by 20.1% to 162.6 cents per share and earnings per share increased by 24.7% to 165.5 cents per share. A dividend of 55.2 cents per share was declared. The group remains highly cash generative with 92% of sales in cash. Cash of R11.2 billion was generated by the group during the year.

SA Economy:
The government said that they are urgently seeking funds to buy diesel needed to fuel auxiliary power plants as loadshedding is expected to intensify later this week. Eskom said it does not plan to order any more diesel until the 1st of April 2023, which could prompt extreme levels of load shedding.
This Thursday, November 24, the South African Reserve Bank’s (SARB) Monetary Policy Committee (MPC) is meeting for the last time in 2022. About 55% of the experts argues that the SARB will hike the interest rate by 75 bps.

Global Economy:
The annual producer inflation in Germany fell to 34.5% in October 2022 from a record level of 45.8% in September.
The unemployment rate in Croatia was 6.5% in October 2022, the highest in five months and up from 6.1% in September.
Economic growth in the U.S. slowed in October, the Chicago Fed National Activity Index decreased to minus 0.05 in October from 0.17 in September.
China warned that they are facing the most severe test of the Covid-19 pandemic, fuelling investor concerns that China may be forced to resume stricter lockdown measures.

Global Company:
The FTSE 100 was little changed at 7 376.
Virgin Money shares rose 14% after the company reported a 43% jump in full-year profit driven by higher interest rates.
Chinese shares were mostly lower, with gains among some property and energy shares.
The Hang Seng Index is lower by 0.84% to 17 507.
In China, the Shanghai Composite is up 0.61% to 3 103.
The Dow Jones Industrial Average fell slightly by 0.13% to 33 700, while the S&P 500 was lower by 0.39% to 3 949.
Walt Disney Co.’s shares rose 5% after board of directors replaced Chief Executive, Bob Chapek with former Chief Executive, Robert Iger.

Commodities:
Gold is down 0.12% to $1 744/oz, while Platinum is higher by 1.45% to $992.30/oz.
Brent crude was 0.96% higher at $87.80 a barrel.

Currencies:
The rand traded at R17.29 against the US Dollar, R20.47 against British Pound and R17.73 against the Euro.
The Euro is slightly firmer against the US Dollar to trade at $1.0252.