Classic Business

Jeremy Sampson, MD of Brand Finance Africa

Prof Adrian Puren, head of the Centre for HIV and STIs at NICD

Bjorn Ladewig, longevity actuary at Just SA

Chantal Marx, head of equity research at FNB Wealth and Investments & Petri Redelinghuys, founder of Herenya Capital Advisors

Kobus Verster, CEO of ArcelorMittal SA, Gerhard Papenfus, CEO of the National Employers Association of South Africa and Nicolette Skjoldhammer, MD of Betterect (Pty) Ltd

TFG has had an interesting few months, with a successful rights issue and emerging with the bulk of Edcon’s 382 SA JET stores (and 4,800 employees) transferred to TFG as of 25 September. While the Botswana, Namibia, Lesotho and eSwatini store base is still waiting on regulatory approval, the bulk of the deal (and potential earnings base) has been concluded. TFG shareholders approved the subscription of an extra R3.95b of capital on July 16th to add about 20% to the number of shares in issue. The company today is worth R27.2bn or R11.9b more than its market value of the 16th July. Or worth some R7.9bn more than the extra capital raised. The higher share price therefore has already more than compensated for the additional shares in issue.

Capitec delivered earnings at the bottom end of the guided range, but a strong operational performance at the interim stage. The significant decline in HEPS year-on-year was driven by credit impairment charges which increased threefold to R6bn. Underlying operations of the business remained resilient under Covid-19 with pre-provision operating profit increasing 12%. This is attributable to income from operations growing 10% y/y ahead of expense growth of 9%, resulting in positive JAWS for Capitec. Its client base grew 6% to 14.6m despite the Covid-19 headwinds. 2019 Sunday Times Business Leader of the Year, and Capitec CEO Gerrie Fourie, talked to Michael Avery about how the country’s largest retail lender defied the odds.

A study conducted by an academic consortium gained global coverage for producing one of the first detailed analyses of the economic effects of covid-19 in a developing country back in July. The reports, published on July 15th, showed how the pandemic has impoverished South Africa—and made one of the world’s most unequal countries even more so.

The findings from the second wave of NIDS-CRAM released on 30 September showed that the 2.8-mil jobs lost between Feb and April had not returned by June. If these job-losses persist it will amount to more than a decade’s worth of job growth lost in the last 6-months (between 2009 and 2019 the economy created 2,4-mil jobs). Michael spoke to one of the lead researchers Nic Spaull, a Senior Researcher in the Economics Department at Stellenbosch University,

Andrew Bradley, co-owner and CEO of Fiscal Private Client Services

The Hawks swooped and arrested the man who occasionally pays the Luthuli House salaries on month-end, a day after the tender tycoon, Edwin Sodi, was defending himself at the State Capture inquiry, explaining a slew of payments to politicians over six years. The multimillion-rand transfers include references to ministers, deputy ministers, and the ANC.

Michael Avery caught up with investigative journalist. Pieter-Louis Myburgh, the author of Gangster State, a book on state capture that detailed Sodi’s links to the ANC’s Secretary General Ace Magashula and others.