| Friday 21 January 2022 Good morning Voornaam,
Stor-Age is finalising the acquisition of four self-storage properties in the UK for a total purchase price of GBP37.5 million. The deal is expected to close at the end of this month and is being executed by the Storage King business in the UK. The initial acquisition yield is 6% based on 77% occupancy, which increases to 7.8% assuming stabilised occupancy of 90%. This is a Category 2 deal (so no shareholder vote is required) and has no impact on Stor-Age's dividend guidance.
To execute the deal, Stor-Age raised R575 million on the market in the space of a few hours. The bookbuild was multiple times oversubscribed, an indication of how deep the capital pools are in South Africa for solid property assets. The issue price was a discount of just 0.92% to the 30-day VWAP.
Distell has released a trading update for the six months to December 2021. Although it may seem pointless to you given that the Heineke n offer is underway, one must remember that shareholders need to still approve the deal and can elect to move into the unlisted structure, so the performance of the business is still relevant.
In South Africa, revenue growth was in the "low twenties" and volumes were "mid-teens" - the company highlights the cider and ready-to-drink categories as delivering exceptional growth. The African business recorded single-digit growth and the international business suffered a single-digit decline due to Covid-related restrictions in Taiwan. The group is in a strong balance sheet position with net debt below R1 billion.
Sibanye-Stillwater had a terrible end to 2021, suffering five fatalities in a single week. The company suspended several operations as a result. Despite this, the SA gold operations (excluding DRDGOLD) performed within guidance. Production for the second half of the year was up 7%. The SA PGM operations achieved productio n above the upper level of guidance, up 8% vs. the comparable period. The US PGM operations suffered a production drop of 9% vs. the comparable period. The PGM Recycling business achieved sales within range. After the various tragedies, some operations remain closed.
Aveng has been popular among retail investors and has released a voluntary trading update. The construction company had work in hand of R29.1 billion at the end of December, up R3.8 billion from the end of June. The Australian business seems to be growing steadily and has a strong pipeline. In South Africa, Aveng has focused on certain underperforming contracts and has made progress in turning them around or terminating them where terms could not be agreed. Negotiations are still underway to sell Trident Steel, which has exceeded budget despite factors like the riots and global shortage of chips.
Orion Minerals closed 6% higher on the news that the early pr oduction assessment for the Prieska Copper-Zinc project is being fast-tracked. The company is hoping to bring production forward by mining the open pit first rather than at the end of the mine life.
There is almost no liquidity in Kore Potash, so on a busy day for InceConnect I couldn't give any space to its operational update. If you are a shareholder in that business, please check out the announcement.
Today's feature article is on Woolworths. After reading such a horrible trading update, I thought the only way to inject some fun into the story is to use an image of an angry kangaroo. Woolworths' experience in Australia has been even scarier than the wildlife. To make it worse, there are pressures at home as well.
As is cus tomary on a Friday, there's also an update from DealMakers on the various corporate actions of the week.
Have a fantastic weekend!
The Finance Ghost
|
|---|
|
|---|
Local and Offshore Market News |
|---|
|
|---|
| Disclaimer
Our content is intended to be used and must be used for informational purposes only. You must do your own analysis before executing any investments or strategic decisions, based on your own circumstances. We do not provide personalised recommendations or views as to whether an investment approach or corporate strategy is suited to the needs of a specific individual or entity. You should take independent financial advice from a suitably qualified individual who gives due regard to your personal circumstances.
Whilst every care is taken, we accept no responsibility or liability for any errors or omissions in any of our content.
The views, thoughts and opinions expressed in our content belong solely to the author or quoted individuals and/or entities, and not necessarily to the author's employer, organisation, committee or other group or individual, or any of our affiliates or brand partners. |
|---|
|
|---|
|
|
