Farm and factory gate inflation‚ as measured by the annual change in the PPI‚ rose to 5.1% in November from 5% in October‚ surprising economists who had expected it to fall slightly, Statistics SA data showed on Thursday. The index‚ which was set to 100 in December 2016‚ rose to 104.6 points in November from October’s 104.1 points. The food component of PPI accelerated to 1.9% from October’s 1.5%‚ with wholesale meat prices rising 13.5% in November from the same month in 2016.
Inflation‚ as measured by the annual change in the CPI‚ slowed to 4.6% in November from 4.8% in October‚ slightly better than the economists’ consensus of 4.7%, Statistics SA reported on Wednesday. The index‚ which was set to 100 points in December 2016‚ rose to 104.2 points in November from 104.1 points in October. Better rainfall contributed to bread and cereal prices falling 4.9% from November 2016. Other parts of the food inflation basket that registered declines included fruit ‚ and oils and fats.
SA’s current account deficit narrowed less than expected in the Q3 of 2017‚ to 2.3% of GDP from 2.4% the previous quarter, according to the Reserve Bank’s Quarterly Bulletin‚ released on Thursday. SA had a trade surplus for a fourth consecutive quarter. The surplus widened from R64bn in the Q2 to R71bn in the Q3‚ based on a faster decrease of merchandise imports compared with net gold and merchandise exports. Declines in the value of both imported and exported goods were driven by lower volumes. The current account is indicative of SA’s trade with the rest of the world.
The retail sector did not do as well as expected in October but still signaled stronger economic growth at the start of Q4, Statistics SA reported on Wednesday. Annual retail trade sales growth slowed to 3.2% in October from 5.4% in September. In rand‚ October’s retail sales grew to R82.2bn‚ down from September’s R82.3bn in current prices. The retail sector is an important indicator of consumer spending‚ which drives growth in the economy.
SA Agricultural Machinery Association said on Wednesday tractor sales leapt 24.9% y/y in November‚ to 566 units. The association said in 2016, sales fell 11.3% to 5‚855 units‚ when drought conditions prevailed in the summer rainfall area. Industry expectations for 2017 are that overall tractor sales should be at least 5% more than 2016. In the first 11 months of 2017‚ tractor sales were up 8.0% y/y.
SA shed 31‚000 formal sector jobs during the September quarter‚ and 83‚000 from the same period in 2016, Statistics SA data showed on Tuesday. The total number of South Africans with formal employment outside agriculture fell to 9.59m in the September quarter from 9.62m in the June quarter. This was down from 9.67m in the Q3 of 2016. But those lucky enough to have jobs earned more. The total salaries paid in the September quarter came to R606bn‚ a 3.3% growth from the June quarter’s R587bn and a 6% growth from R572bn in the Q3 of 2016.
Manufacturing production got the final quarter of a tough 2017 off to a good start‚ as expected‚ posting growth of 2.2% for October from a year earlier‚ after a revised 1.7% y/y contraction in September, Statistics SA reported on Tuesday. Compared with September‚ manufacturing production was up 0.7%. For the three months to October‚ output increased 0.8%‚ with only two of 10 subsectors showing positive growth in that period: petroleum‚ chemical products‚ rubber and plastic products‚ up 4.3%; and basic iron and steel‚ nonferrous metal products‚ metal products and machinery‚ up 0.7%. For the year to date‚ however‚ manufacturing production had contracted 0.9%.
Tax revenue has doubled in the past 10 years‚ according to data from the South African Revenue Service (SARS). SARS’s head of revenue and research‚ Randall Carolissen‚ said personal income tax had been the biggest contributor since the 2008-09 financial crisis. Revenue increased from R572.8bn in 2007-08 to R1.144-trillion in 2016-17‚ up R571.3bn. In this period‚ the total revenue collected was R8.13-trillion. Revenue from personal income tax increased from 29.6% in 2007-08 to 37.2% in 2016-17.
SA Wine Industry Information and Systems said on Monday the wine industry was bracing itself for what might be the smallest harvest in more than a decade due to the severe drought in the Western Cape. Wineries and viticulturists were predicting a much smaller 2018 crop compared with 2017‚ which could possibly be the smallest since 2005.
Star said on Friday it was refinancing some R16bn in loans from Steinhoff International‚ a week after Steinhoff said it would seek better terms from its subsidiary. RMB has been appointed to handle the refinancing of the shareholder loans and ring-fence funding facilities. The new facilities will be used to repay Steinhoff shareholder loan funding and provide the Star group with stand-alone financing facilities‚ said the company.
Merafe Resources warned on Friday that the price for ferrochrome it would receive in Q1 of 2018 was 15.1% lower than the current price. Its share price fell as much as 3% to R1.36 after it said the European benchmark ferrochrome price had been settled at USD1.18/pound for the first three months of 2018‚ down from USD1.39/pound in Q4 of 2017.
Altron on Friday claimed it was innocent of collusion in the government’s DTT set-top box tender. The group was responding “to recent allegations in the media”‚ that said President Jacob Zuma’s son Mxolisi had solicited a R54m bribe from Altron’s subsidiary Altech UEC to swing the contract its way. It said it was in the process of selling Altech UEC‚ but added that the deal may be delayed due to competition authorities investigating collusion regarding the DTT set-top box tender.
Lonmin announced on Thursday that its share price jumped 28% to R16.05, while Sibanye-Stillwater’s fell 4.4% to R15.41 after the pair announced a merger proposal. The deal would see Lonmin shareholders receive 0.967 Sibanye-Stillwater shares for every Lonmin share. At a closing price of R16.11 for Sibanye-Stillwater‚ it valued Lonmin at R15.57. Lonmin said its board viewed Sibanye’s offer in the best interest of shareholders and all other stakeholders‚ providing the platinum miner with “a comprehensive and sustainable solution to the adverse challenges it faces”.
Standard Bank said on Thursday it had appointed Lungisa Fuzile as CEO for its South African unit. A former director-general within the Treasury‚ Fuzile would take over from Sim Tshabalala‚ who has served in the role since 2008. Ben Kruger stepped down as joint CEO of Standard Bank Group in September‚ leaving Tshabalala as the sole head of Africa’s biggest bank by assets. Kruger and Tshabalala took up their joint roles in 2013‚ following the retirement of Jacko Maree.
PPC’s share price fell 8.4% to R5.77 on Thursday morning after LafargeHolcim announced it had terminated talks with the cement maker. PPC's independent board “has now similarly advised LafargeHolcim that it does not wish to pursue a transaction on the basis of LafargeHolcim’s current nonbinding proposal”, said the company. PPC also said the empowerment ownership of its South African business had shrunk to 5.4%‚ far under the government’s 26% for mining companies.
Steinhoff’s share price plunged as much as 13% on Thursday morning‚ after the group acknowledged that accounting errors stretched back to 2016. Issues concerning the validity and recoverability of certain Steinhoff Europe balance sheet assets under scrutiny in the 2017 audit work were also relevant to the 2016 consolidated results. The 2016 consolidated financial statements would need to be restated.
EOH said on Wednesday its founder and former CEO Asher Bohbot was returning on a full-time contract 'to focus on strategy and stakeholder management'. Bohbot’s return followed a turbulent week during which EOH’s share price plunged 11% on December 6 and then a further 35% on December 7. EOH’s share price continued its rebound‚ rising as much as 8.5% to R53.19.
Christo Wiese has possibly raised about R622m from his JSE-listed property group Tradehold to assist with the credit crunch facing Steinhoff International. Tradehold‚ whose share price plunged 20% last week because of its association with Steinhoff via Wiese‚ rebounded 8% to R15.48 on Tuesday after announcing it was redeeming all its preference shares for R10 each. In addition‚ Tradehold said it would pay a 3.6c dividend to its preference shareholders before cancelling them on December 18.
Dis-Chem Pharmacies’ share price fell 9% to R35.10 on Tuesday morning‚ just above the R35/share book build price achieved by founders selling some of their shares. Founding shareholders CEO Ivan Saltzman‚ category executive Stan Goetsch and director Niall Hegarty raised a combined R1.12bn by selling 32m shares via an accelerated book build announced on Monday.
Labat said on Tuesday that HEPS declined 44.8% to 1.81c in the year to end-August‚ while net asset value almost doubled‚ due to the start of its logistics business. The company said revenue increased to R52m from R14.3m‚ primarily because of the commencement of transport contracts during the period.
Investec’s share price rose as much as 4.1% to R88.49 on Monday morning after it reassured investors that its exposure to Steinhoff International was negligible. Investec has two shares trading on the JSE which are theoretically identical. Possibly thanks to the rand strengthening 0.35% against the pound to R18.28‚ Investec plc shares with code INP strengthened more than its limited shares with code INL‚ which rose 3.5% to R87.99. Investec said in a statement on Monday that its loans to Steinhoff represented less than 0.25% of its total R464.8bn credit exposure at September 30.
Blue Label Telecoms said on Monday the Competition Tribunal had approved its deal to acquire the remaining 52.63% shares in 3G Mobile‚ in a R1bn deal that would expand its suite of services. It said the deal would be implemented in February after fulfilling the last regulatory requirement. The total value of the transaction was R1.9bn.
ArcelorMittal SA announced on Monday that it had appointed Hendrik Jacobus Verster as CEO and executive director from February 1 2018‚ replacing Wim de Klerk‚ who is stepping down at the end of January 2018. Verster was CEO of Aveng from February 2014 until September 2017.
Metrofile said on Monday it had completed a share purchase agreement for the entire capital of SDS Kenya. The company said the maximum purchase consideration of SDS Kenya was about R281.4m‚ and would allow Metrofile to increase its footprint in Africa. The purchase would be settled in cash from Metrofile’s existing resources and a facility arranged for this purpose with Standard Bank.
Sea Harvest and its parent Brimstone Investments announced on Monday that negotiations were under way to acquire Viking Fishing for an undisclosed amount. Sea Harvest said it was leading a consortium of broad-based black economic empowerment investors which is considering buying all of Viking Fishing.
EOH said on Monday its share price rebounded 7.4% to R51.05 after it said the previous week’s 44% crash was caused by “involuntary trading” when two directors’ shares were sold by stockbrokers. It said shares worth R143m were sold by its CFO and executive director. This was a forced sale of shares triggered by financial institutions “due to the shares being linked to an equity finance transaction resulting in a margin call”, said the company.
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