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KINGJAMES 34593 JOY WILL TAKE YOU FURTHER Not for Sale to Persons Under the Age of 18. Drink Responsibly.
2 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
Saluting top-earning companies
Awards recognise those that have created most value
T
HE Top 100 Companies to exclude distortion from extreme
awards acknowledge those movements in penny stocks.
listed companies that have This qualification does not apply
created the most wealth shareholders over that period, after fortunes, the share price plus the If prices declined at the end of to the Top 100 one-year and 10-year
and value for shareholders. taking into account normal and income returned to shareholders is August as companies went ex- tables, which retain the minimum
The share price performance of special dividends — these, along an indicator of the soundness of a dividend, we have accrued the value-traded threshold of R10-
every company listed on the JSE — with bonus shares, are deemed to company’s operations — if one dividend. million for the sake of continuity.
which forms the basis of this have been reinvested when accepts that share price In previous years, we excluded We have also included a Top 40
research — is calculated using a declared. performance is generally an companies that did not meet a index table to show the
hypothetical initial investment of Where there has been an accurate barometer. threshold of minimum value traded performance of the JSE’s blue-chip
R10 000 in each share over a period unbundling, the proceeds from the We exclude suspended companies of R10-million per year. companies and their relative
of five years, from September 1 unbundled company are treated as (although they may be included in However, since 2011, we have performance over five years.
2010 to August 31 2015. a special dividend. other tables and data), preference increased the minimum value to Calculations were done by
The winner is the company that Apart from being an accurate shares, loan instruments and R20-million because of higher financial services company I-Net
has earned the most for measurement of shareholder derivatives. trading volumes over the years and BFA.
❛ ❛ ❛
There’s very little doubt that In the last 12 months Wiese A quick glance at
Christo Wiese — retail had a hand in a wide variety the list of the
tycoon and serial risk-taker of deals, worth cumulatively Top 100 Companies
— is hands-down the most many billions of rands. This firmly lays to rest any
adventurous and intriguing flurry of activity seems to thought that
character in the local confirm that the legendary Johannesburg might still
investment arena. And investor — now 76 — is not be a mining town. There is
he has made loads of close to contemplating not one mining company
money to boot — Marc retirement — Marc among them — Ann
Hasenfuss, P4 Hasenfuss, P5 Crotty, P3
NOVEMBER 1 2015 | Sunday Times TOP 100 COMPANIES BusinessTimes | 3
TOP TEN
Joburg riches now lie above ground
Property-related investment
makes its way up JSE ranks
ANN CROTTY On average they are in-
vesting just 3% of their funds
A
QUICK glance at under management into the
the list of this real-estate trusts. Corona-
year’s Top 100 tion Fund Managers is the
Companies firmly significant exception with a
lays to rest any thought that 10% exposure.
Johannesburg might still be Pension funds may have to
a mining town. sit up and take better notice.
There is not one mining This year, for the first time, a
company among them. property company features
Based on the movements as the JSE’s top performer
in the Top 100, it would be no over five years.
exaggeration to suggest Fortress Income Fund’s B ping malls in mining towns After five years of steady
Johannesburg is becoming a share, little known to tra- and commuter transport price appreciation, Fortress
property town. nodes, with a 75% exposure Income Fund B shares began
❛
Property-related invest- Fortress B to large national tenants. to soar towards the end of
ment companies, or real-es- CEO Mark Stevens ac- calendar 2014 — from R13 a
tate investment trusts, have shares began knowledged that as leases year ago, they are now trad-
been making their way to soar are renewed in a weaker ing around R33.
steadily up the ranks of the trading environment, there Stevens attributes the in-
top 100 performers rather
towards the will be pressure on rental crease to investor sentiment
like some little-noticed army end of 2014 income, but he said much of around the rand’s depreci-
on the march. this pressure would be coun- ation and the company’s off-
That march, which started ditional investors more fo- tered by the group’s increas- shore exposure.
several years ago, has re- cused on industrials, finan- ingly valuable exposure to The pending acquisition of
sulted in the market capi- cials and mining stocks, is international property. Capital Property Fund has
talisation of the property the latest top-ranked per- This exposure comes in also helped.
sector steadily edging ahead former. the form of its equity in- The share split between
of not just the mining sector Over the past five years vestment in New Europe Fortress Income A and B
but of retail and healthcare, this entity, which was first Property Investments and shares is unusual. Stevens
too. listed in 2009, has generated Rockcastle Global Real Es- likens the A shares to bonds
Listed real-estate invest- annualised returns of 72.7% MAN OF PROPERTY: Mark Stevens, the CEO of Fortress tate. Like Fortress, New Eu- — investors have a prefer-
ment trusts, which pay out at for its shareholders. Picture: RUSSELL ROBERTS rope and Rockcastle are part ential claim to the income
least 75% of their dis- For traditional equity in- of the Resilient stable, and distribution of the fund but
tributable profit to sharehold- vestors, the name of the en- New Europe itself is ranked the distribution’s growth is
ers each year, now account tity may smack of the dull- though not unique, capital lion of that and investment in 13th on the Top 100 Com- capped at the lower of 5% or
for just under 6% of the JSE’s ness of a bond investment structure. other property-related equi- panies table. CPI.
total market capitalisation. combined with the bland- The Fortress Income Fund ties accounting for the re- Rockcastle, listed in Mau- The remainder of the earn-
But despite this steady ness of a property stock, but has a portfolio worth just maining R12.8-billion. ritius for several years but ings are distributed to B
growth, it seems the large that name camouflages an over R20-billion with direct Just over 80% of the direct relatively new to the JSE, shareholders, who score the
pension funds remain unim- exciting mix of property as- property investments ac- properties consist of retail manages properties in most for holding the “riski-
pressed. sets and a compelling, al- counting for around R7.5-bil- assets in the form of shop- Poland and Zambia. er” of the two assets.
TOP TEN
Desert blooms Trustco currently has
57.4ha of residential land in
development, and 23.7ha in-
dustrial.
for Namibia’s
In total the company still
has 4 200ha in the pipeline
and is developing phase six
of 19 phases of the largest
Trustco Group
approved private residential
estate in Namibia.
Trustco will remain open-
minded on future acquisi-
tions.
The company listed on the
LUCKY BIYASE ance and life products is also JSE Africa board at the
one of our key target areas height of the international
W
HILE every- for the near term. The future financial meltdown in 2009
body is com- looks bright here at Trust- and its stock took a drub-
plaining about co,” Van Rooyen said. bing. Van Rooyen said while
restrictive trad- He noted that the share the company’s stock may
ing conditions in the market, price performance of the have taken a whack initially,
Trustco Group Holdings Namibian diversified service its business models were
CEO Quinton van Rooyen is a company seemed to be an sound, and performance in
happy man and more bullish outlier. BULLISH: Trustco Group Holdings CEO Quinton van Rooyen. The company’s performance core areas was not an issue.
than ever. “Business opportunities in has been buoyed by property development in Namibia Picture: RUSSELL ROBERTS “Since capital markets
“Currently, we’re doing Namibia remain plentiful, were ruinously expensive
great. We’re busy integrat- and we intend to seize them during that time, we were
ing a new acquisition in the wherever and whenever Trustco’s expansion into ness, which is currently driv- 70.43% annualised returns. A fortunate to have direct for-
investments segments as they are offered,” Van the resources sector with the en by the property market. R10 000 investment in Trust- eign investors that recog-
well as focusing a lot of at- Rooyen said. acquisition of an alluvial “In the long term, we will co five years ago would now nised the opportunities we
tention on the bank. He admitted that the busi- diamond mine and local di- remain primarily an insurer, be worth nearly R140 000. were presenting and sup-
“Positioning for future ness had not progressed amond polishing factory with these investments pro- The company started in ported us during the tough
growth in short-term insur- without facing hurdles. brought its own challenges viding sustainable above-av- 1992 as a property developer times.” Investors and staff
and opportunities. erage returns for the insur- and it retained its keen in- who acquired shares in the
“As a related party I had terest in land. company during that time
❛
no vote on the board or as a Namibia is a “As they say: buy low, sell are now smiling, Van Rooyen
shareholder, but the minor- high — we’ve done that. One said.
ity shareholders voted over- place of of our industrial develop- Operating in post-indepen-
whelmingly in favour of the abundant ments was bought in 2004 dence Namibia had benefited
acquisition. when the markets were in the company’s fortunes.
“I believe that we managed
investment the doldrums and we re- “Namibia is a place of abun-
to equip ourselves sufficient- opportunities mained patient by sitting on dant business and invest-
ly in a short space of time to this investment until 2011 ment opportunities, a coun-
tackle this endeavour, and ance book,” he said. when the markets started to try of contrasts and un-
the board can be commend- Thriving property devel- recover,” Van Rooyen said. tapped investment potential.
ed for their foresight opment in Namibia con- “Then we really saw some “We enjoy the support of
throughout,” he said. tributed greatly to the com- great benefits coming from Namibians and have man-
Van Rooyen’s focus in the pany’s phenomenal showing. this strategy. Our other aged to attract more than
short term is the company’s Over the past five years to property developments are 3 000 Namibian shareholders
core insurance business as September Trustco has re- done with this same forward- who are enjoying the ride
well as the investments busi- warded shareholders with thinking plan in mind.” with us.”
4 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
LIFETIME ACHIEVER
KEEN EYE: Christo Wiese, chairman of Pepkor and Shoprite Holdings, at home in Clifton, Cape Town Picture: RUVAN BOSHOFF
Multibillionaire Wiese
MARC HASENFUSS patches for Wiese. Former prime
minister PW Botha’s Rubicon —
IT is possible to argue the toss which crunched the rand — saw
about which business personality Pepkor squeezed on the wrong side
‘addicted’ to doing a deal
is the best investor in South Africa. of the sudden currency fluctuation.
There are so many inspiring Wiese’s financial services empire
“zero to hero” stories, ranging from and property player Monex never
Anton Rupert to Donald Gordon panned out as envisaged, and there
and, more recently, Brian Joffe, was a costly dalliance with luckless
Markus Jooste and Jannie Mouton. fluorspar miner Sallies. But a seem-
But there’s little doubt that ingly unflappable Wiese pushed
Christo Wiese — retail tycoon and
serial risk-taker — is hands-down
Adventurous investor always keen to hear new ideas through these setbacks.
Another interesting facet to
the most adventurous and intrigu- Wiese’s investing style is that he
ing in the local investment arena. Tradehold, mining conglomerate investments, but a close associate These sentiments were recently does not run or manage the com-
And he has made loads of money Pallinghurst Resources, niche real of Wiese reckons the chances of echoed at an investment presen- panies he invests in, preferring to
to boot, the latest estimates sug- estate player Texton Property and consolidating the investment port- tation by longtime Shoprite CEO leave the day-to-day operations to
gesting his fortune might soon newly formed investment hub Stel- folio and closing up shop to new Whitey Basson, who remarked: management that he trusts.
threaten the R100-billion level. lar Capital Partners. investments is highly unlikely. “Christo loves deals and hates That’s not to say Wiese is aloof or
Wiese has always been a little Past investments have included “Christo is addicted to doing walking away from them.” passive. An executive at a Wiese-
different from the JSE’s other unlisted fashion retailing conglom- deals. At any time of the week you Wiese’s dealmaking acumen has aligned company noted: “He takes a
“heavy hitters”. The Joffes, Ru- erate Pepkor, liquor group KWV, will see people waiting outside his seen him famously getting the bet- keen interest in seeing his invest-
perts, Moutons and Joostes have investment house PSG, vehicle door for meetings. He is always ter of SABMiller in the acquisition ment working out successfully.
largely contained their invest- tracking firm DigiCore, Boland keen to hear out people with new by Shoprite of struggling retailer Having a hard-boiled dealmaker as
ments to one of a few vehicles. Bank (later part of the BoE con- ideas.” OK Bazaars in the late ’90s. a big shareholder keeps manage-
On the other hand, Wiese — who stellation), Ocean Diamond Mining, Another acquaintance believes The retail chain was bought for ment on its toes, and ensures that
could easily have retired on his first fluorspar miner Sallies, gold miner Wiese “feeds off the energy of deal- R1, but Shoprite ultimately scored Christo rarely does second-rate
big investment in low-cost fashion GoldOne, and Monex, which de- making and relishes the challenge R1-billion in net assets — including deals.”
retailer Pep Stores — invests freely veloped Century City and the Canal of negotiations”. securing a claim of R300-million Fellow investors are also in awe
through any number of vehicles. Walk shopping centre. from SABMiller. of Wiese’s ability to gear up for
❛
At the time of writing, Wiese Although he has shown no in- He feeds off the Around the same time, Wiese investments by leveraging off his
remained a significant minority clination to do this, if Wiese “in- also outmanoeuvred Remgro- valuable retail holdings. This way,
shareholder in supermarket giant stitutionalised” his various invest- energy of aligned diamond miner Trans Hex he has reportedly borrowed large
Shoprite and furniture behemoth ments into a single entity, it would dealmaking in a bid to snag control of Ocean sums to make new investments —
Steinhoff International as well as certainly rival some of the biggest Diamond Mining — an investment although he has countered that his
holding influence at investment investment counters on the JSE.
and relishes he subsequently sold for a small gearing was considerably more
giant Brait, industrial supplies He does appear to be tidying up, negotiations fortune. conservative than that of Warren
specialist Invicta, property hybrid or at least rearranging his major Of course, there have been rough Buffett’s Berkshire Hathaway.
NOVEMBER 1 2015 | Sunday Times TOP 100 COMPANIES BusinessTimes | 5
BUSINESS LEADER OF THE YEAR
A magic year of dealmaking
MARC HASENFUSS interests in UK-based Reward and local in Torre and Tellumat mixed with a pen-
structuring specialist Mettle — could see chant for financial services.
C
HRISTO Wiese’s year in deal- some re-arrangement, possibly the merg- The question on everybody’s lips, how-
making probably trumps a life- er of Tradehold’s UK property interests ever, is whether Wiese will ever entertain
time of transactions for most under Moorgarth with Texton’s UK in- an offer for his stake in Africa’s biggest
professional investors. terests. supermarket chain Shoprite.
In the past 12 months, Wiese had a Stellar Capital is Wiese’s “anything can There are perennial murmurings that VAST NETWORK: Christo Wiese, business leader of the
hand in a wide variety of deals — worth happen” company with industrial interests Steinhoff may be a very willing buyer. year Picture: HETTY ZANTMAN
cumulatively many billions of rands.
This confirms that the legendary in-
vestor, now 76, is not close to retirement.
The big deals were mostly executed in
investment company Brait, in which
Wiese is a prime mover. But some of the
smaller transactions might prove sig-
nificant as Wiese’s work-in-progress in-
vestments start panning out.
NOVEMBER 2014
Wiese — via his well-known nominee
company Titan — sells his 57% stake in
cash-pumping fashion retailing
conglomerate Pepkor to Steinhoff
International. At the same time, Brait
also sells its 37% stake in Pepkor to
Steinhoff.
Tradehold, the hybrid property
company controlled by Wiese, hikes its
stakes in UK-based financial services
company Reward and real-estate-owner
Moorgarth to 100% and 95% respectively.
DECEMBER 2014
Invicta, the industrial supplies
conglomerate, acquires SA Tool for an
undisclosed sum.
JANUARY 2015
Invicta announces a rights offer,
underwritten by Wiese, to raise
R2.25-billion.
APRIL
Cash-flush Brait acquires an 80% stake
in health and fitness chain Virgin Active
for around R14-billion.
Stellar Capital Partners, a newly
constituted investment company in
which Wiese holds influence, buys a
strategic stake in asset management and
financial services business Cadiz.
MAY
Brait acquires a 90% stake in UK-based
fashion chain New Look for around R16-
billion.
Tradehold enters a joint venture
agreement with JSE-listed Texton
Property Fund. Texton and Tradehold
subsidiary Moorgarth — via a special
purpose vehicle called Inception —
acquire the Broad Street Mall in
England, for around R600-million.
JUNE
Wiese, via the Luna Group, snatches an
8.6% stake in Texton.
JULY
Stellar acquires 26.25% of acquisitive
industrial supplies and services group
Torre Industries. The stake is
subsequently pushed up to 34.58%.
AUGUST
Stellar cashes in R209-million after
selling its significant minority
shareholding in vehicle tracking and
fleet management firm Digicore to US-
based Novatel Wireless.
SEPTEMBER
Invicta’s mainstay subsidiary, Bearing
Man, acquires industrial gearbox unit
assembler Hansen SA.
Stellar sells Goliath Gold Mining to
GROWTH.
GoldOne Africa.
OCTOBER
Brait sells its 200 million Steinhoff
shares — received in part settlement for
the Pepkor transaction — for R16-billion.
The proceeds are used to settle Brait’s
R14.2-billion debt obligations.
In a separate transaction, Brait
increases its stake in UK-based
supermarket group Iceland Foods to 57%
in a R3.4-billion deal.
Wiese — via the Lunar Group —
increases his holding in Texton to 16.78%
after underwriting a rights issue. While we strive to be the best, not necessarily the biggest,
Stellar buys out minority shareholders in we understand that growth enables our business. So we’re
Cadiz, which will be delisted from the JSE. always alert for new opportunities in our highly competitive
Speculation is rife that Wiese’s next big world, yet never lose focus on enhancing the value of our
move via Brait could be a tilt at a well-
known retail chain in the UK. portfolio and creating new world-class developments.
But investors would do well to watch We’ve invested in people who share our vision and our We’re not landlords. We’re people.
Wiese’s smaller investments. commitment. Shouldn’t you invest in them too?
Invicta has long been subject to spec-
ulation that it will expand its existing
global footprint in the Far East — a move
that has been linked to a secondary listing
on an international bourse.
Wiese’s interests in Texton and Trade-
hold — which also owns financial services
6 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
TOP TEN
EOH goes on shopping spree, again
ASHA SPECKMAN Acquisition of rail technology
E company the third this year
AGER to grow EOH
further, CEO Asher
Bohbot struck again
by picking up a new become accustomed to fre- rail as infrastructure is a
company in railway automa- quent acquisitions. Its share prerequisite to any economic
tion and technology in Africa price has been climbing at development in Africa,”
this month. over 60% on a compound an- Bohbot said.
The purchase of Mehleke- nual growth rate, reflecting In June this year, EOH an-
to Resourcing is the latest in market faith in the strategy. nounced the purchase of
a shopping spree of at least If there ever was pressure stakes of between 49% and
three new acquisitions an- on EOH management to 80% in Twenty Third Cen-
nounced since February this maintain the momentum, it’s tury Systems, a pan-African
year. not showing. “There’s no information technology ap-
More than 20 businesses pressure,” Bohbot said. plication and business solu-
have been bought by EOH He said that the EOH ap- tions provider and its sub-
over the past five years and petite for acquisitions was sidiaries.
the annual buying trend is driven rather by the need to In February, it bought Con-
unlikely to slow down soon, bolster know-how in key struction Computer Soft-
according to company man- ware, which provides solu-
❛
agement. Rail as tions for the construction
But although EOH has and mining sectors.
revved up its acquisition infrastructure Bohbot is expecting these
counter, it had to settle for is prerequisite new additions to contribute
third place on the Sunday 10% to 15% of revenue in the
Times Top 100 index after it
to economic 2016 financial year.
was beaten to second place development Providing technology for NO PRESSURE: EOH CEO Asher Bohbot says his taste for acquisition is driven by the need
by Namibia-based Trustco water purification technolo- to bolster know-how in key growth areas . Picture: ROBERT TSHABALALA.
Holdings this year. growth areas. gy and the energy and trans-
EOH had held second “We see ourselves as a port sectors are other areas
place for the past two years. technology and knowledge of potential growth for the
Investors in EOH, howev- services organisation,” Boh- company. though the economy is not
er, are unlikely to feel dis- bot said. Last month, EOH chief fi- hot, I believe IT services will
appointed. An investor who Mehleketo, a company nancial officer John King continue to grow.”
sank R10 000 into the com- with R300-million annual said the company would also The company, which Boh-
pany five years ago when its turnover that provides so- seek to augment its business bot founded 17 years ago, has
share price was R12.34, and lutions for the design, build- process outsourcing divi- begun to market its intel-
had reinvested all dividends ing and management of sion, particularly in process- lectual property for con-
over the period, would have state-of-the-art operational ing claims and in property struction and public sector
gained 69.38% a year, or a nerve centres for the rail management. solutions in Dubai, Portugal,
total return of R139 402 on industry, will boost EOH’s Byron Lotter, portfolio the UK, Europe and South
their initial investment by capacity to deliver automa- manager at Vestact, said re- America.
August 31 this year. The tion technology and attract a cently: “There are still lots of It is also selling software
share price then was just slice of the growing infras- buying opportunities out solutions for banking and re-
over R158. tructure spend on the con- there. They are also not con- tail. This would contribute
The company listed in tinent. fined to just South Africa. As about 10% to the business,
1998. By now, investors have “There’s no question that for the ICT sector, even said Bohbot.
TOP TEN
NEW
OFFERING:
PALESA VUYOLWETHU
TSHANDU
It’s a pizza cake Taste
Holdings CEO
Carlo
T
ASTE Holdings, the
multifranchise spe- Gonzaga,
cialist, will reap the
rewards of rep-
utable global franchises
when it adds Starbucks and
with Domino’s right, says
that, globally,
the big
brands win
and Starbucks
Domino’s Pizza to its ex- Picture:
panding foreign portfolio. TYRONE
Taste Holdings makes its ARTHUR
debut in the Top 100 Com-
in the bag
panies rankings this year be-
cause in its previous trading
history it did not consistent-
ly meet the annual threshold
of R20-million value traded.
The company’s debut at
No 4 indicates the rewards have that with the brands Zebra’s Chicken, and the
shareholders who backed we’ve got across food and jewellery division.
the company in the past five jewellery,” said Taste Hold- Devin Shutte, CEO of My-
years have received. ings CEO Carlo Gonzaga. Wealth Investment, said
An investment of R10 000 The value of the stock Taste was looking to raise
in the 55c Taste stock in soared with the announce- R226-million for Starbucks
September 2010 would have ment of the acquisition of and Arthur Kaplan stores by
brought an impressive total licensing rights of multina- way of a rights offer. Kaplan business. Taste’s interim results this “We would like to be
return of just over R84 000 for tional coffee house Star- The group is expected to “It’s also the last equity month reported core rev- known as a great custodian
the investor by August 31 bucks in July this year. list 75 million new shares at that we plan on raising,” said enue growth of 51% to R455.9- of the world’s best brands
this year. Gonzaga said the Star- R3 per share. Gonzaga, adding: “In the fu- million while net tangible as- and we’ve been given the
The listed South African bucks, Domino’s and Arthur Despite the dilution, the ture, we plan on funding the set value per share increased opportunity, so it’s up to us
franchise management Kaplan brands represented rights issue was likely to be Starbucks roll-out through to 95.2c. to execute,” said Gonzaga.
group will shed two of its the biggest growth opportu- perceived positively by the regenerated funds and
existing pizza franchises — nities in the business, men- market, as it would allow debt.”
Scooters Pizza and St Elmo’s tioning that in the luxury Taste to fast-track store roll- On the African expansion
— to convert these to Domi- goods business “revenue is outs of recognised and plans, Gonzaga said the com-
no’s Pizza outlets in an effort evenly split between NWJ “arguably well-received” pany would focus largely on
to drive growth and access and Arthur Kaplan”. brands, Shutte said. South Africa.
key markets. “We license brands within He added that the group “Countries outside of our
Taste Holdings has imme- our store, we don’t advertise had an “aggressive” strategy borders represent great po-
diately leapfrogged food ourselves as Rolex, so people of bringing very high-profile, tential, but they also require
franchise rival Famous look at the Arthur Kaplan desirable brands into South quite a deep understanding
Brands — which now occu- brand but they don’t realise Africa and the surrounding of investment in those mar-
pies 22nd position after a that it is the largest retailer countries to generate rev- kets,” he said.
solid run of several years in of those brands in Southern enue. “We are quite focused on
the top 10. Africa,” he said. Gonzaga said Taste had Africa below the equator,
“When we look anywhere With a market capitalisa- earmarked R140-million of but we are also clear that the
else in the world, we see that tion of R1.07-billion, the di- the R226-million rights issue opportunity we have is in
in the long run, it’s the large, versified management com- to go towards Starbucks, and South Africa and it will be
reputable, admired brands pany owns food outlets the balance of R86-million that way in the next couple of
that win the day, and we Maxi’s, The Fish & Chip Co, would be used in the Arthur years.”
KINGJAMES 34636
IT TAKES A
TOP 100 COMPANY
TO INSURE ONE.
Being a top 100 company ourself, we understand what it takes
to build a successful business and we do everything we can
to protect yours. Santam. Insurance good and proper.
For more information, speak to your broker. www.santam.co.za
Santam is an authorised financial services provider (licence number 3416).
8 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
TOP TEN
Coro’s
Even Rand Merchant In-
surance — hardly a fledgling
entity — is moving in on
Coronation’s traditional
patch. In what could be a
crown is
major shake-up of the in-
dustry, RMI announced it
was targeting the hold that
Coronation, Investec and Al-
lan Gray — often referred to
as the CIA — have over the
market.
slipping
RMI has established a new
asset management business,
RMI Investment Managers,
which is taking minority eq-
uity stakes in a number of
boutique asset managers.
It wants to help them bulk
a little
up to a size that will enable
them to attract stronger in-
flows but not get to a size
where they are too big “to
move the needle”.
Unless it is able to make
significant moves into off-
Company drops from one shore markets, it is difficult
to see how Coronation can
to five as respect, awe fade recover its former earnings
glory.
Its well-earned blue-chip
ANN CROTTY record it has notched up so status will guarantee it a po-
far. sition among the ranks of the
I
T has been a tough year The fallout from the col- top performers, but just not
for Coronation Fund lapse of African Bank, in DECLINE: Anton Pillay, CE of Coronation Fund Managers Picture: HETTY ZANTMAN at the very top.
Managers. The share which it had a 22% stake, last This of course has impli-
price reached a record year dragged into this year cations for the very generous
high of R115 on December 31 and continued to damage the agers, there was also the sig- net outflows of R0.5-billion. have been given to Anchor remuneration system so far
2014 but the start of trade in company’s returns and rep- nificant weakness in in- More damaging was the and Sygnia suggest investors enjoyed by the company’s
2015 marked the beginning of utation. vestor sentiment, in part due reduction in performance regard these relative new- top managers that was the
a steady decline in the share The very public spat with to the sustained sluggish fees from the high level comers as pretenders to subject of much debate at
down to the current level of economic growth but largely achieved in the previous Coronation’s throne. this year’s AGM.
❛
R68. More because of investor skittish- comparable period.
It’s an indication of the ness ahead of an expected This saw Coronation’s rev-
company’s outstanding per- damaging lifting of US interest rates. enue down 6% and diluted
formance in the previous was the In May, Coronation re- headline earnings 10% lower.
four years that Coronation leased its results for the six The results ensured there
has been able to secure fifth
reduction in months to end-March, which, was no relief from the down-
position in this year’s Top performance although not unexpected, ward pressure on the share
100 table, down from the fees from the seemed to shock the market. price.
number one slot last year. At that stage, Coronation While its size appears to
But the awe and respect high level was still the largest manager have been a positive influ-
with which Coronation has of long-term retail assets in ence in the years of growth,
been regarded for much of activist shareholders at its South Africa with a 15.2% now analysts say it not only
its 22-year history appears to annual general meeting in market share. makes it more difficult for
be fading. January drew much unwel- During the six-month pe- Coronation to “move the nee-
Increasingly, the invest- come attention to its unusual riod, retail inflows plateaued dle” but also makes it dif-
ment community is talking and extremely generous re- but Coronation managed to ficult to get out of a stock
of its slipping crown and sug- muneration structure. attract net retail inflows of ahead of an anticipated
gesting it may be too big to On a broader perspective, just over R8-billion. On the weakness.
sustain the sort of growth and affecting all fund man- institutional side, there were The frothy valuations that
TOP TEN
ANDRIES MAHLANGU
Afrimat is a success story in tough market
A
FRIMAT is punch-
ing above its
weight — and its
efforts have not Of the company’s short- to share price that grew an
gone unnoticed. medium-term prospects, Van average of nearly 50% a year.
In the past five years, the Heerden said it was counting But Vunani Securities an-
minerals and construction on national and provincial alyst Anthony Clark was
materials supplier has, for road infrastructure spend- more cautious, noting that
the most part, lifted its head- ing, which is projected to the share had limited upside
line earnings by about 20% increase to R44.7-billion in potential, unless Afrimat
each year — a remarkable 2017 from R10-billion in 2006. produced blockbuster earn-
feat in a sector hit by weak The South African Nation- ings in the 2016 financial
market conditions and low al Roads Agency, which year. Afrimat trades on a
investor confidence. maintains the national road price-to-earnings ratio of
Appearing for the second network, is one of Afrimat’s 16.5 times.
consecutive year in the top clients. Either way, Afrimat has
10 of the Top 100 Companies The company also hopes to been a success story in a
rankings, the small-cap com- expand into the rest of tough market.
pany occupies sixth position. Africa. Headline earnings per
If you had invested R10 000 From a lowly R3.13 a share share in the 2015 financial
in the company in September in 2010, investors have year were up 24% from last
2010, the returns would have pushed up the stock to R20, year, and the total dividend
been R74 386 by the end of leaving Afrimat with a mar- rose to R53-million from
the review period, August 31 ket value of R3-billion and a R40.1-million.
this year. In the same period,
the JSE construction and
materials index lost 43%.
CEO Andries van Heerden,
referring to the company’s
inclusion in the top 10, said:
“The one word to sum up our GRATEFUL: Andries van Heerden, CEO of Afrimat, seen here presenting the group’s results
feeling is that of grateful- in 2013 Picture: BUSINESS DAY
ness. We are feeling blessed.
“We are trying to diversify
the business into a portfolio with the company achieving recently, Cape Lime. turn the acquired businesses
that will see each component a compound annual growth Momentum SP Reid Secu- into cash-generative assets.
contribute to the bottom rate of 21.55% in headline rities analyst Sibonginkosi The company consists of a
line.” earnings per share over the Nyanga said: “Afrimat has mining and aggregates di-
The strategy to beef up the past five years. evolved from a pure construc- vision, which is the biggest
industrial minerals business The acquired entities are tion company to niche mar- contributor to profit growth,
through several acquisitions Glen Douglas‚ The Clinker kets.” He added that man- and a concrete-based prod-
has paid off handsomely, Group, Infrasors and, more agement had the ability to ucts unit.
NOVEMBER 1 2015 | Sunday Times TOP 100 COMPANIES BusinessTimes | 9
TOP TEN
Wiese’s used to acquire controlling
stakes in two unlisted busi-
nesses: New Look, for which
it paid R14.1-billion for 90% of
Brait comes
the company, and Virgin Ac-
tive, for which it paid R12.3-
billion for an 80% stake.
Gnodde says Brait has sig-
nificant long-term growth
in at No 7
plans for its portfolio,
whether it be the roll-out of
new stores in New Look in its
prioritised markets, opening
new gyms for Virgin Active
globally or introducing new
in Top 100
products for Premier Foods.
Wiese said although Vir-
gin Active is seen as a UK
company, more than 60% of
its pre-tax earnings are gen-
erated in South Africa —
similarly with New Look,
Strategy of moving money which has 70% of its store
portfolio in the UK.
out of the country pays off “Growth opportunities will
be outside the European
THEKISO ANTHONY LEFIFI pound annual growth rate of Union,” Wiese said.
32.6% over the same period Gnodde said the ongoing
C
HRISTO Wiese, who and Sanlam 25.7%. challenge in managing the
is Brait’s largest Brait has been external- BROAD VISION: John Gnodde, chief executive of Brait, is excited about finding exceptional investment portfolio was to
shareholder and ising its funds extensively in investment opportunities dig out pockets of sustain-
South Africa’s rich- recent months. able growth.
est person, once had almost The company shed its Pep- “Brait will continue dig-
£680 000 (about R1.4-million kor stake through a deal that lion in the financial year end- stronger businesses on a According to Gnodde, the ging out exceptional invest-
at today’s rate) seized by saw Steinhoff raise R18.2-bil- ing March 2015 from just R2- more sustainable basis. Im- Pepkor deal closes Brait’s ment opportunities for its
British authorities while he lion in equity to acquire billion in 2011. portantly, Brait’s core in- first chapter since the July portfolio and is excited about
was carrying the money in 92.3% of the retail group from Its share price has surged vestment skill, developed 2011 change in business the prospects for its current
eurozone countries in 2009. investment vehicles con- by 93% through the course of over the past 25 years with a model from private equity portfolio of investments giv-
This was probably a sign of trolled by Wiese. The deal this year alone. strong focus on capital al- house to long-term invest- en their global positioning,
business strategy to come also guaranteed Wiese a seat Had you invested R10 000 location, has been retained,” ment holding company. performance track records
for his investments. on Steinhoff’s board. Gnodde said. The majority of the capital and unique growth oppor-
❛
Wiese fought for his con- Steinhoff is currently His key themes in assess- raised in March 2015 was tunities.”
fiscated funds and won them preparing to list on Frank-
Brait sees no ing an acquisition are that it
back. But he has not stopped furt’s bourse and will even- acquisition should have a solid track
moving “his” money out of tually become an exter- prospects in record demonstrating strong
South Africa to Europe — at nalised company. earnings growth and high
least via Brait, ranked sev- Brait, which is now based South Africa cash-flow generation; a
enth in the Top 100 Com- in Luxembourg, has already or the entire proven, aligned and experi-
panies. been externalised and under enced management team;
The investment company John Gnodde’s leadership continent and a clear and coherent
has been the top performer sees no acquisition prospects market strategy.
over five years in the JSE’s in South Africa or the entire in Brait on September 1 2010, It should also be market
Top 40 Index, returning on African continent. your investment would have leader in its home country, to
average 48.3% per year to Gnodde and Wiese seem been worth over R71 000 by provide a solid base from
shareholders. happier to be in established August 31 this year. which to drive expansion.
It outpaced JSE giants markets, despite the likeli- Gnodde said four years Gnodde said the invest-
such as Naspers, parent com- hood of lower returns, than ago Brait moved away from a ment company required that
pany M-Net, Media24 and to go for higher-risk assets, private equity model to that the business case could ex-
MultiChoice, which grew by according to some analysts. of a longer-term investment ceed Brait’s hefty internal
42% annually. Brait’s market capitalisa- holding company. benchmark return of 25% per
Discovery achieved a com- tion grew to nearly R79-bil- “This allows Brait to build year.
A range of products built on the foundation
of quality and durability
Afrimat Limited is a leading black empowered
®
open pit mining company providing an
integrated product offering ranging from
aggregates, industrial minerals, concrete
products (bricks, blocks and pavers) to
readymix concrete.
Afrimat has established a strong foothold
in contracting services comprising mobile
crushing, screening,drilling and blasting.
Backed by more than 45 years’ experience,
GIVE A HELPING HAND Afrimat listed on the JSE Limited in 2006. As
and you could WIN Investing in part of its continued diversification strategy,
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10 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
TOP TEN
Capital gains in
London boom
Prices soar as brands supplant locals
BRENDAN PEACOCK commercial tenants such as tate agency group Savills.
Apple, Chanel and Balthazar The UK’s Telegraph news-
A
S THE owner of are clamouring for attention paper headlines recently
two important from the high street. screamed, “Exodus of home
property assets in Since the 2008 financial buyers from London”.
London, at Earls downturn, London house Quite clearly, the UK cap-
Court and Covent Garden, prices have shot up more ital’s property market would
Capital & Counties Proper- than 46% above their pre- appear to be overheated,
ties has benefited from the crisis peaks, at an average driving Capital & Counties to
incredible surge in property price of more than £525 000, deliver an annualised total
prices in the UK’s capital. according to the UK’s Office return to shareholders over
As central London increas- for National Statistics. That the past five years of 47.8%.
ingly becomes home to the is R10.9-million for an av- If an investor had put
world’s dollar-billionaire set, erage London pad. R10 000 into Capco five years
the world’s leading brands While locals are either ago, that initial investment
are also moving into town to moving further out of town would be worth just shy of MARKET-LEADING RETURNS: Ian Hawksworth, CEO of Capital & Counties Properties
sell wares to the well-heeled. or struggling to meet rental R70 500 as of the beginning of
Earls Court is preparing obligations, London has be- September.
for demolition of the long- come the world’s most ex- Could the company — and Covent Garden as a leading maintain a “clear focus on level of gearing by industry
standing convention site to pensive city for companies to the UK property market — global destination,” the com- London” and said it had a standards, and the company
make way for residential rent residential and office sustain such momentum? pany said. long-term vision for its res- talked up its “robust” bal-
property; in Covent Garden, space, says a survey by es- According to the company, Over at Earls Court, Capco idential and retail develop- ance sheet with a “conser-
shareholders in Capco have decided the exhibitions busi- ments: “At Covent Garden, vative loan-to-value ratio of
enjoyed market-leading re- ness was not being used to we have invested close to 12% and a weighted cost of
turns over the past five years its capacity — an ongoing £500-million to create one of debt of 3.3%”.
even while the company has problem for all facilities of the largest managed estates This means the company
sought to reposition the this type — and went in London and we will con- has more room to innovate at
property it owns in London, through a land-planning pro- tinue to invest, provided as- its prime London sites, and
such as the “iconic” Covent cess to create a more valu- sets meet our internal ex- remains optimistic that de-
Garden estate. able development scheme. pected returns. mand for these areas will
“Covent Garden lacked a “Lillie Square was our first “At Earls Court, we con- remain strong: “London’s
vision to match its potential. residential development in tinue to make small but im- population is expected to
Our strategy was to establish the Earls Court master-plan portant acquisitions around grow by two million by 2031.
a tenant mix that was rel- area. Phase one of that the master-plan area. Our To thrive, London needs
evant to the modern con- scheme is sold, underpinned development focus is [now] more places for people to
sumer and create an envi- by the strength of our lo- on phase one of Lillie Square, live, work and enjoy. Covent
ronment that would allow re- cation and the quality of our where construction is on Garden and Earls Court are
tailers and customers to development,” the company track and sales of phase two two of London’s greatest ad-
thrive. Through these ef- said. have recently begun.” dresses and well placed to
forts, we have reinforced The company intends to Capco has a relatively low succeed,” the company said.
TOP TEN
Getting
fired
scrubbed
the slate
clean
THEKISO ANTHONY LEFIFI
formance, Jannie views his plained by shareholders’ im-
PSG GROUP would not be sudden firing at SMK as a plicit faith in management’s
around today had Jannie “blessing in disguise”. eye for deals.
Mouton’s friends and busi- Thanks to his zeal to get As Jean Pierre Verster of
ness partners not fired him up from defeat, Jannie is the 36One Asset Management
from Senekal, Mouton & 48th richest person in Africa, pointed out, buying all the
Kitshoff, a stockbroking according to Forbes maga- underlying counters would
company he co-founded with zine. provide shareholders with
R50 000 lent to him by his Piet reckons his father will 95% of the net asset value of
mother and his late wife. continue to work until the PSG Group at a significant
In fact, had “the boere Buf- day he dies. “It [PSG Group] discount to its share price.
fett” not been let go, Capitec, LIKE FATHER, LIKE SON: Piet Mouton, CEO of PSG Picture: HETTY ZANTMAN is his baby,” Piet said. Verster said the market’s
Zeder and Curro Holdings The group’s one regret is application of an “aggressive
would arguably not be what selling EOH, this year’s and optimistic” premium in-
they are today. R70 000. Not bad for a com- says before adding: “We are trading at R244 a share — a third-ranked company. dicated expectation of cor-
Piet Mouton, Jannie’s son pany that was not even in the proud of this achievement.” milestone for a company that Piet said at the time that porate action — unbundling
and CEO of the group, con- top 10 in last year’s Top 100 This year, PSG Group is turns 20 this month. management did not under- or separate listing of one or
curs with that. rankings. ranked ninth — up 14 places PSG Group’s market cap- stand the company but now more parts of the PSG
He said being fired allowed Jannie, now PSG Group’s from the previous year’s italisation has grown from he views it as an “excellent group’s private equity in-
his father to start with a chairman, points out in the 23rd spot. R4.2-billion by the end of 2010 quality company”. vestments.
clean slate. company’s annual report The share price has been to R54-billion by the end of Jannie said PSG undoubt- The group also benefits
Had you invested R10 000 that had you invested growing at 47.27% annually March this year, its financial edly has a quality asset port- from the hefty management
in the group five years ago R10 000 in November 1995 for five years. year-end. folio and “I am confident we fees it charges Zeder Invest-
instead of spending it on Soc- when he launched the com- Over the latest five-year Return on equity over the will continue to yield above- ments.
cer World Cup tickets or a pany, today the investment period, the share price same period swelled from average returns in future”. However Jannie and his
plasma screen, your invest- would be worth more than surged a staggering 560.8%, 13.7% to 19.06%. And the com- Looking at the sum of the team decide to crystallise
ment by the beginning of R280-million. outpacing the JSE All Share bined market capitalisation parts within PSG Group, further value, holders of the
September this year — “The same investment in index, which increased by of companies PSG Group has PSG’s share continues to share have so far continued
thanks to a reinvigorated the JSE All Share index over 75% over the same period. interests in is around R130- trade at a premium to the to benefit from the unflag-
and entrepreneurial Jannie this period would be worth Year to date, the PSG share billion. group’s net asset value, ging optimism of those who
— would be worth almost R1.7-million today,” Jannie price has jumped by 90.6%, On the back of this per- which can probably be ex- buy in at these levels.NOVEMBER 1 2015 | Sunday Times TOP 100 COMPANIES BusinessTimes | 11
TOP TEN
Niche logistics forge path to the top
GOOD THING GOING: Ian Lourens says the success of his
business lies in its people Picture: RUSSELL ROBERTS
OneLogix dominates niche
logistics services market
LONI PRINSLOO Lourens, and another busi-
ness, Vehicle Delivery Ser-
“TALK to anyone in a pub vices, established by Neville LAST YEAR’S WINNERS: Sanlam CEO Johan van Zyl (business leader 2014), Laurie Dippenaar (lifetime achiever 2014),
and they will have a great Bester. Coronation Fund Managers CEO Anton Pillay (2014 top company), Trevor Manuel (2014 special award) and Telkom chief
idea, but the people that can Over the decade that fol- marketing officer Enzo Scarcella (CSI award 2014 – Telkom) Picture: JEREMY GLYN
actually make money from lowed, the business perfor-
those ideas are few and far mance was flat, with a slight opportunity to focus on the
between,” says OneLogix spike during the boom years original business again,”
CEO Ian Lourens. in 2007 and 2008. The com- says Lourens.
He co-founded the only lo- pany listed on the AltX board Essentially this gives the
gistics company to make it in 2004 and graduated to the businesses OneLogix ac-
into the top 10 of the Sunday JSE main board in 2013. quires a chance to relaunch
Times Top 100 Companies The business has seen sig- into a new growth phase.
this year. nificant growth during the Lourens says the company
It has been a tough year for past five years, largely driv- would look to expand the
most South African compa- en by acquisitions of other business further in the com-
nies, with economic growth businesses, as well as start- ing year through potential
contracting to an estimated ing another three of its own. further acquisitions, as well
1.3% for 2015 and global com- The company comprises 13 as expanding in Africa.
modity prices free-falling, businesses that range from It employs about 2 000 peo-
making it especially difficult abnormal load transporta- ple and operates in Namibia,
for logistics companies to tion, to moving chemicals in Botswana, the Democratic
make a buck. tankers, to the branding of Republic of Congo, Malawi,
Lourens says margins at trucks, and one of its most Mozambique, Zambia and
OneLogix have also been un- recent acquisitions was in Zimbabwe.
der pressure, but the acqui- “We have been in Africa
❛
sition-hungry company’s se- Not one of for decades, and we know
cret was to move things that how to operate there. Cur-
most other people were not our team has rently, about 20% of our busi- La Motte La Motte La Motte Pierneef La Motte La Motte
moving. left us since ness comes from South and single pack twin pack twin pack triple pack Syrah Magnum
“Anyone can buy a bakkie
the business East Africa, but we would R 109 R 139 R 339 R 235 in gift box
and courier stuff, but not a like to increase that.” 1x Cabernet 1x Sauv. Blanc 1x Pierneef Sauv. Blanc 1x Sauv. Blanc R 329
lot of people have the ca- started Lourens says the biggest Sauvignon 1x Millennium 1x Pierneef Syrah/Viognier 1x Syrah
pability and fleet to trans- secret to his success has 1x Glass
port massive cranes or logistics services software. been getting the right people
chemicals, for instance. That “I have always been an en- into the business. La Motte
5 bottle wooden box
is a different game.” trepreneur, and I like to part- “The people make the Moët &
OneLogix provides niche ner with businesses built by business. From our drivers R 699
logistics services and has other entrepreneurs,” says to our management team. 1 x Sauvignon Blanc Chandon
been in business for more Lourens, who started his Not one of those on our man-
1 x Chardonnay Brut Bubble
than 20 years. first business in 1979, sup- agement team has left us 1 x Millennium Bag
1 x Cabernet Sauvignon 1x 750ml Impérial Brut
Its brands include Vehicle plying equipment to mining since the business started.” in Bubble Gift Bag
1 x Shiraz
Delivery Services, Commer- houses. Whether Lourens meets .90
cial Vehicle Delivery Ser- Lourens believes most his next business partner in R 449 per unit
vices, OneLogix Projex, companies reach a “glass the pub or in the bush, where
OneLogix Projex Cargo So- ceiling” at some point. he likes to spend holidays, he
lutions, Madison, OneLogix “We provide a platform for looks to have a good thing
Linehaul, United Bulk, Atlas such companies. We take going — with Adrian Saville,
360, DriveRisk, Jackson, Buf- care of their human re- chief strategist at Citadel,
felshoek Transport and sources needs, administra- listing OneLogix as one of his Veuve Rosé Moët &
QSA. tion, IT, their drivers’ needs, top 10 stocks going into the TseTse Gift Pack Chandon Brut
While most South African and the entrepreneurs get an next 10 years. R 549.90 Bubble Box
companies have been strug- per unit 1x 750ml Impérial Brut in
gling to recover since the Bubble Gift Bag
.90
global recession hit in 2009, Veuve R 419 per unit
OneLogix has seen its share
price skyrocket from 97c in Clicquot
August 2010 to around R5 a Yellow Metal
share currently. Fridge
If an investor had been R 449.90
clever enough to put R10 000 per unit
into OneLogix five years ago,
it would have grown by an
annual average rate of 45.5% a
year to R65 000 by August 31.
OneLogix listed 15 years
ago, in 2000, at about R1 a
share. The company was
born out of a marriage of
PostNet, co-founded by12 | BusinessTimes TOP 100 COMPANIES NOVEMBER 1 2015 | Sunday Times
TOP TEN ROUNDUP
Property
pays off for
half of the
top 10
Exposure to listed property a
trend among high performers
LONI PRINSLOO 100 Companies list have ex-
posure to the listed property
I
NVESTORS in listed sector.
property companies The top-performing share GOOD VIEW: Listed property companies have kept shareholders happy in a favourable interest-rate environment Picture:
have been smiling all in terms of share price CAPITAL & COUNTIES
the way to the bank as growth, Fortress Income
the sector went on an un- Fund B, was the largest listed
precedented run supported property company to hit the Capital & Counties at num- in value by more than 650% any medium-term investor. last year to number five this
by a favourable interest rate JSE’s main board on debut in ber eight. over the past five years. “Although this is moder- year and construction com-
environment during the past 2009, with a market capital- Last year there were no Sesfikile Capital fund man- ate compared to the 20%-plus pany Afrimat slipped from
five years. isation of R1.8-billion. listed property companies ager Kundayi Munzara said returns we have seen in the number five to sixth.
The South African govern- The compound annual that made it into the top 10. the sector offered a 7% yield last five years, this is a de- Coming in at number four
ment has been hesitant to growth of this company’s The newly appointed chief and around 8% to 9% dis- cent return which should is the food and jewellery
increase interest rates since share price has been close to investment officer at Cannon tribution growth for the next outperform bonds and cash franchising company Taste
the global recession, in an 73% a year, which means if Asset Managers, Andrew over this period,” said Mun- Holdings, that most recently
❛
effort to try to stimulate one invested R10 000 in this Dittberner, said that in the No listed zara. acquired the Starbucks cof-
economic growth in the company five years ago, you past decade, and especially Besides the companies in fee brand in South Africa, a
country. would now have more than a the past five years, support- property on the listed property sector, new entrant into the top 10.
This has fuelled the bull R150 000 in the bank. ive interest rates had bol- last year’s EOH, an information tech- Rounding off the top 10
run in the country’s property The number two company stered the sector. nology services company, best-performing companies
market, as well as other sec- on the Top 100 list, Trustco He warned that the listed
top 10 list has managed to take a spot in for the Top 100 Companies
tors supported by consumer Group Holdings, also has ex- property sector was overval- the top 10 for the past four rankings is diversified in-
spending, such as the food posure to the property sec- ued and investors should not two years. years, but its resilience, too, vestment group PSG at num-
and retail sectors. tor, although through prop- expect the same returns to This is against bond yields will be tested through a ber nine and specialised lo-
As the South African econ- erty development. continue — although oppor- above 8% and a weakening tough 2016. gistics company OneLogix at
omy slows through 2015 and Coronation Fund Man- tunities “remain for in- consumer environment. The company came in at number 10, which may be
2016, momentum in these agers, in the number five vestors with the ability to “Broadly, we expect the number three this year, hav- pushed to maintain such a
sectors is likely to change. position, invests in the listed stock-pick”. sector to deliver total re- ing placed second last year. lofty position in a difficult
Half of the companies in property sector, and so do The JSE South African list- turns of 9% to 11% per year on Coronation Fund Man- macroeconomic environ-
the top 10 on this year’s Top Brait at number seven and ed property index has grown a three-to-five-year view for agers fell from the top spot ment.
WORST PERFORMERS
ANDRIES MAHLANGU
Heavy metals sinking to the bottom
R
ESOURCE and con-
struction shares re-
main a sore point
for many investors
in 2015.
Save for a handful of
stocks, the two sectors have
massively underperformed
the JSE All Share index over
the past five years.
Underscoring the extent of
the underperformance has
been the progressive down-
grading of some of these
companies from their cov-
eted spots.
Kumba Iron Ore is the lat-
est among the major mining
companies to lose its top-40
blue-chip status, having lost
72% of its market value in the is due in the coming months. the highly rated pharmaceu-
five years to August 2015. “The responses of produc- tical stock.
Similarly, the road has ers to the previous slump in Still, you would have pock-
been bumpy for the construc- prices will start to constrain eted about R41 420 had you
tion sector where the erst- supply. The pace at which invested R10 000 in the com-
while market darlings such this will happen will vary — pany five years ago.
as Aveng and Murray & much sooner, for example, in Absa’s head of private
Roberts are languishing in the case of crude oil than client asset management,
the lowly rated small-cap iron ore, where there is still wealth and investment man-
market, where some insti- SUNSET INDUSTRY: Lonmin has massively underperformed Picture: KEVIN SUTHERLAND ample low-cost supply.” agement, Craig Pheiffer, said
tutional investors and track- Although declining in its while Aspen was operating
er funds cannot invest. long-standing influence on effectively across its chosen
If you had invested R10 000 companies has declined to in the construction sector as have added to the mix of the domestic share market, emerging markets, the
in Harmony Gold five years R414-billion as at June 2015, miners moved to cut back on lower profits, or losses, in which is now dominated by weakness of EM currencies
ago, your total return would from R675-billion a year ago, capital expenditure. some mining companies. industrial stocks such as in the uncertain global en-
have shrunk to R1 557 as of according to a recent re- Excess capacity and slug- “We are still of the view SABMiller and British Amer- vironment, together with the
September 1. search conducted by PwC. gish demand in commodities that global growth remains ican Tobacco, South Africa company’s levels of dollar-
If you had done the same in The consultancy cited the such as copper and iron ore unsynchronised, and that still generates significant denominated debt, made it
Aveng, your capital would drop in commodity prices commodity prices will re- foreign exchange earnings vulnerable.
have been reduced to R1 386. and increased cost pressures main weak in the medium from the mining sector. Invicta Holdings has also
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But the steepest drop is as some of the key factors Commodity term,” Obsidian Capital an- Meanwhile, Aspen Phar- slid markedly from last
from Lonmin, where only weighing on the industry. alyst Richard Simpson said. macare has slipped down to year’s seventh position to
R407 would be left of the It’s a theme that has been prices will Holding a contrasting view 26th position in this year’s 63rd in 2015. Invicta operates
R10 000 initial investment. in place since at least the stay weak in are Capital Economics an- rankings from eighth last in the cyclical mining, agri-
Collective market capital- 2008 global financial crisis alysts, who argue a bounce in year, as some investors cultural and construction
isation for the top 35 mining and has had knock-on effects medium term some industrial commodities trimmed their positions in sectors.You can also read
