South Africa: Brait Sees Strong Results On Pepkor, UK Buys

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Investment holding company Brait [JSE:BAT] said in a trading statement issued on Monday that its reported net asset value (NAV) per share as at September 30 2015 is anticipated to be in the range of €7.81 (R120.90) and €8.05 (R124.68).

In percentage terms, this increase in reported NAV per share represents an increase in the range in rand terms by 248% to 259% for the 12 months ended September 30 2015. In euro terms the increase in range is 220% to 230% for the period. For the six months ended September 30 2015, it represents an increase in the range of 32% to 36% in euro terms and in rand by 57% to 62%.

It is primarily due to the disposal of Brait’s investment in Pepkor during March 2015 and the strong operational performance from both Premier as well as Brait’s recently acquired investments in New Look and Virgin Active.

Billionaire businessman Christo Wiese is the biggest shareholder in Brait.

Brait announced in May this year that it would acquire almost all of budget retailer New Look for $1.2bn. This has given the company a strong presence in the UK’s fashion retail market. New Look has 600 stores in the UK and Ireland and trades from a further 200 across Europe, North Africa, the Middle East and Asia including China.

Brait’s British pound denominated investments in New Look, Virgin Active and Iceland Foods also made a positive impact due to the strengthening of the pound against the company’s euro and rand presentation currencies, when translating these at September 30 2015.

The company said the financial information on which its trading statement is based has not been reviewed and reported on by its external auditors. The interim financial results up to September 30 2015 are expected to be released on or about November 17 2015.

In September this year Brait said it is to raise £350m via a convertible bond to fund acquisitions.

By late morning trade on Monday, Brait’s share price was down 1.12% to R155.01.

Source: Fin24

Cape Town CBD headed for major transformation

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CAPE Town’s central business district (CBD) is headed for major transformation that will add R7bn to the total value of property once major construction projects are completed by 2020.

The Central City Improvement District (CCID) says that is a conservative estimate for the increase in the value of CBD property once projects such as the Cape Town International Convention Centre expansion and the new Christiaan Barnard Memorial Hospital are completed.

The CCID is a private-public partnership that provides complementary urban management services in parts of Cape Town’s inner city.

Research released on Tuesday by property research firm by Lightstone shows that the Western Cape has had the highest number of super-luxury property sales over the 10-year period 2005-15. Gauteng was second, followed by KwaZulu Natal and then Mpumalanga.

Super-luxury properties exceed R10m in value. Lightstone says across SA, properties worth more than R10m are purchased predominantly by those in the age band of 45-54 years.

Those aged 35-44 are the second-largest group buying super-luxury properties.

During the CCID’s annual general meeting on Monday it said the city’s official property valuations had risen from just over R6bn in 2006 to close to R24bn this year.

Chief operating officer Tasso Evangelinos said at the AGM that in 2011, the collective rand value of all residential sales in the central business district was R115m. This jumped to R296m last year, despite fewer new residential developments being recorded over the period.

“We have also seen public infrastructure investment add enormous value to the CBD, from the introduction of MyCiTi, the work being done to our roads and pedestrian thoroughfares to the upgrading of the Cape Town Station, and now the rollout of broadband,” said Mr Evangelinos.

“Construction cranes are etched along our skyline. By 2020 we will conservatively see another R7bn added to the CBD, once current construction is completed on buildings such as the (convention centre) expansion and the new Christiaan Barnard Memorial Hospital — to name but a few of the developments already in progress. These, and many others that have risen in just the past few years, have transformed the landscape of our CBD,” he said.

The new multimillion-rand Netcare Christiaan Barnard Memorial Hospital is expected to open its doors in 2016. The hospital complex will have a total of 250 beds, state-of-the-art theatres, doctors’ surgeries and consulting rooms, linked retail, a gym and a parkade.

The convention centre expansion is on track to be completed in early 2017. The project, jointly funded by the city and the Western Cape provincial government, will cost about R832m. The development will see the centre doubling its capacity and its contribution to GDP.

Other developments include Tsogo Sun’s construction of two hotels on the old Tulip Hotel site valued at R680m, and the Sentinel, a R200m residential development on the corner of Loop and Leeuwen streets.

Mr Evangelinos also said the CCID and the City of Cape Town had begun to research the most viable models to optimise public space management in the CBD, in terms of infrastructure and beautification.

Francois Viruly, an independent property economist and associate professor at UCT, said the commercial property market continues to show a strong performance. Initiatives such as the CCID increased investor confidence and drove demand by users, he said.

“The returns and values of properties is determined by what happens in buildings and the broader urban environment in which they are located, ” he said.

Original artical appeared in BDLive

Textile company hosts German delegation

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Falke South Africa recently hosted a high-profile delegation led by the German Chamber of Commerce. The group, from Lower Saxony, consisted of members of parliament, leading business delegates as well as representatives from various tertiary institutions and visited the legwear manufacturer’s factory in Bellville South, Cape Town.
Professor Jorge Marx-Gomez from the University of Oldenburg with Charral Adams, Quality Control Supervisor in the Finishing Department.

Professor Jorge Marx-Gomez from the University of Oldenburg with Charral Adams, Quality Control Supervisor in the Finishing Department.

The visit to Falke was facilitated by specific request from the Chamber of Commerce in Hannover, the capital city of Lower Saxony, which neighbours North-Rhine Westphalia where the Falke international headquarters is located. The delegation discussed the latest news, developments and technological advances within the South African company and investigated potential opportunities.

During the factory tour and review of the business, CEO Martin Grobbelaar reiterated the important role the company plays as a major employer in South African garment manufacturing.

“Falke has experienced significant growth during the past 15 years and continues to make a huge investment in our people and industry. Education, skills development and training, as well as community development, remain core focus areas for us as a business. To ensure continuous skills development, we have both in-house and international training facilities and have added a local computer literacy programme as well. We currently produce approximately 13-million pairs of socks and hosiery per year, but the continued demand for our product has necessitated that we expand to deliver a 20 % increase in sock production within the next financial year,” said Grobbelaar.

 Original article from Bizcommunity .

Phase Eight performance surprises TFG

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The Foschini Group’s (TFG’s) newly acquired UK fashion brand Phase Eight, which is not available in South Africa, has surpassed the group’s expectations in the first half-year financial results to 30 September, released on 12 November.

TFG, which had 2 390 stores in 31 countries globally by the end of the period, is the owner of @Home, Duesouth, Fabiani, Exact!, Donna Claire, to name a few. In the rest of Africa, the group opened 120 stores and closed 10 that were not profitable in the six months ended 30 September. In the rest of the world, the group has 81 stores.

TFG CEO Doug Murray said in an interview with finweek that under the tough economic conditions, producing a growth in headline earnings per share (HEPS) of 16.6% is a good result.

TFG reports that, excluding Phase Eight, the group turnover increased by 33.6% to R9.8bn in the period. The group said it had strong cash sales growth of 15.8% (67.4%, when including Phase Eight) that now represent 46.2% of the group turnover (which adds up to 55.4% when including Phase Eight).

Murray said: “When we bought the business we didn’t expect Phase Eight to be accretive to our earnings this year because when we buy a business like that, we have the debt overseas and we knew what we were budgeting for this year. What actually happened is that Phase Eight results were slightly ahead of expectations for us in British pounds. And there are earnings accreted.”

Although Phase Eight is not a large part of the TFG business, Murray said it is a part of the group’s long-term strategy.

“We suspect they will be slightly accretive for the full-year results and we are very happy with the way the integration is going with the business and on plan,” he commented.

Credit sales for the group went up 6.8% from 2.5% in the corresponding period.

Murray said that with credit sales at 6.8%, this is positive, considering that the company had not changed their credit granting criteria and there had not been growth in new accounts, meaning the growth is coming from existing accounts.

Clothing proved to be the best performer for the group in the first half of the year, with combined turnover growth being at 12.5% excluding Phase Eight. The 13.1% growth in homeware and furniture, the 10.2% growth in cosmetics, and 6.3% in jewellery followed this.

The group is well on its way in adding an e-commerce offering to some of its brands. Last year it went online with @Home and in June, the group added Totalsports, Sportscene, and Duesouth to its online stores.

The group is still forging ahead with its Africa expansion strategy – it plans to open about 330 stores across the continent by 2021.   From Fin24.com