SA Top Companies 2016

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Financial Mail Page 1 -29/08/16 02:21:01 PM

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The Winners pg 8 • SA Giants pg 16 • Top Performers pg 56

T P
COMPANIES
2016
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Editorial
Financial Mail editor: Rob Rose
Top Companies editor: David Williams
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Writers: Joan Muller, Maarten Mittner, Ruan
Jooste, Stephen Cranston
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Cover: Colleen Wilson

Editor in chief: Peter Bruce


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ontents
51 Short-term insurance: Affordability has changed the
FRONT OF THE BOOK game
52 Financial services: A viable sector in its own right
5 Definitions 53 Information technology: Mergers could rescue the
6 Methodology sector
54 Property: Cash still king amid growing uncertainty

WINNERS INVESTING IN TOP COMPANIES


8 The underdog makes its way to the top
12 - 14 The Top 20 56 Top Performers: Tenacity pays off for smaller
companies
58-62 Table: Top Performers
63 Unit trusts: Leader in investment trends
65 Corporate governance: New measures to rein in firms
SA GIANTS
16 Shrinking giants in shrinking sectors
18 Top miners going on a strict diet
20-30 Table: SA Giants SERVICES
66 Legal advisers: Time to charge by the second
67 Table*: Legal advisers and corporate clients
SECTORS 69 Sponsors: Growing demand for faster trading
70 Table*: Sponsors and corporate clients
72 Medical aid: NHI: Cure for ailing system
31 Chemicals: Caution amid commodities uncertainty 73 Table*: Medical aid schemes/societies and corporate
33 Mining: Fraught times . . . desperate measures clients
34 Gold: Haven in the storm again 75 Advertising: Mobile rattles desktop’s web rule
35 Platinum: New entrant takes risks and scores 76 Table*: Advertising agencies and corporate clients
36 Construction & Materials: Building blocks aid growth 77 PR Agencies: Social media: Friend and foe
in sector 77 Table*: Public relations agencies and corporate
38 Transport: Still moving despite bumps clients
39 Food & Beverages: Sweet deals change the game * due to space constraints these tables have been
40 Travel & Leisure: Tenacious efforts pay off for some shortened
41 Household goods: Tobacco firms not going up in
smoke
42 Health & Pharmaceuticals: One big player in SA and
Africa
44 Retail: Excelling in tough times
46 Media: Still sailing the rough seas
47 Telecommunications: Business conditions cause for
concern
48 Banks: A mixed bag of fortunes
50 Life assurance: Big players’ growth predictions

FINANCIAL MAIL • TOP COMPANIES • 2016 4


Financial Mail Page 5 -29/08/16 02:21:34 PM

Figures in tables provided by INET BFA were calculated value of all fully paid and issued ordinary shares calculated at
according to the definitions below. Consolidated audited the closing price of the last trading day of March 2016.

DEFINITIONS
financial statements received before the end of March 2016 ❍ Equity funds: Equity funds (ordinary shareholders’ funds)
were used. For certain companies with financial year-ends consist of ordinary share capital, all capital reserves and
towards the end of the calendar year, statistics may thus distributable reserves, adjusted for the same items as the “total
refer to financial years ended during 2014. assets” above.
STANDARDISATION OF FINANCIAL DATA Provisions included with credit balances such as warranty
The figures used in this publication differ from those provisions, provisions for self-insurance and provisions for
published by the companies. INET BFA standardises all the maintenance are included with long-term loans or creditors in
published financial statements because the accounting the case of short-term provisions. Deferred tax is regarded as
conventions used by companies differ, making it practically retained profit.
impossible to compare and rank companies using their ❍ Net profit: Net profit is defined as taxed profit attributable to
published data. The JSE-listed companies to be compared ordinary shareholders, excluding extraordinary and exceptional
with each other are diverse. There are also many financial items. Deferred tax and amounts transferred to reserves, is
items to be considered in the process of standardisation. It is excluded from the calculation of net profit and directly handled
therefore impossible to describe, in a few words, what is in retained profit, thus increasing taxed profit.
done with each item in the process of standardisation to Provisions are treated as disclosed under the equity funds
achieve the goal of comparability. In interpreting and definition above. Currency conversion gains and losses are
allocating specific items, however, basic accounting excluded in all cases as not all companies treat this item in the
principles are followed. same manner. Also excluded are items such as cost of control
written off and prospecting expenditure. The pretax difference in
INTERNAL RATE OF RETURN profit between Lifo and Fifo or average inventory values is
The internal rate of return is a market-related return taking added to net profit.
into account, by way of a discounted cash flow calculation, ❍ Pretax profit: The effect of extraordinary and exceptional
both share price movements and dividends paid. The share items is excluded from pretax profit (profit after interest paid
price five years ago (end-March 2011) is taken as a cash but before taxation). Apart from this, pretax profit has been
outflow and all annual dividends for the next five years (both adjusted with all the variables as described in “net profit” above.
cash dividends and dividends in specie) as well as the share ❍ Earnings per share: Headline earnings per share as published
price at end-March 2016 are taken as cash inflows. The by the companies are used in all instances. Where historical EPS
internal rate of return is then quantified by finding the (as in the case of growth in EPS) is used, this is adjusted for
discount rate that equates the present value of all dividends stock splits and consolidations.
and the share price at end-March 2016 with the share price ❍ Dividend per share: Dividends per share consist of the total
five years ago (end-March 2011). All data is adjusted for share of cash dividends and stock dividends (as a proxy for cash
splits and share consolidations. dividends), declared in respect of the years under review.
GOLD COMPANIES, FINANCIAL COMPANIES & THE REST ❍ Debt: Total debt (the sum of long-term interest-bearing debt
The structure of the financial statements in the database of and short-term interest-bearing debt) is used in all ratios.
INET BFA differs between gold companies and all other DEFINITIONS OF SOME OF THE RATIOS
companies. The reason for this is basically the difference in ❍ Compound growth: In earnings per share and pretax profit.
the nature of business of the two categories. The definitions The compound growth in the above variables is calculated using
of the ratios of the two categories of companies therefore the available data for the latest five years available.
differ, but the meaning and quantification are the same. Where a company has not been listed for five years, the
Financial companies — comprising the banking, short-term compound growth has been calculated for the shorter period.
insurance, long-term insurance and financial services sectors Where either the beginning or ending figures or both are
— are also treated differently in defining the various ratios. negative, N/A is indicated because the calculation would result
Again this is done because of the difference in the nature of in bias.
the business. In all cases care is taken to maintain the ❍ Average dividend yield: The average dividend yield for the
comparability of the performance and other measures. For five years ending March 2016 is calculated. If a firm is listed for
example, all the ratios are calculated before taking less than five years, the average dividend yield for the shorter
extraordinary and exceptional items in the income statement period is given.
into consideration. Naturally, these items include the profit ❍ Return on assets: Profit before interest but after tax as
or loss on transactions in the financial markets. These defined above, divided by total assets as defined above.
transactions have been treated as “in the normal course of ❍ Return on equity: Net profit as defined above, expressed as a
business” for financial companies, but as extraordinary for percentage of equity as defined above.
all other companies. As no turnover in the normal sense of ❍ Interest and financial lease cover: Profit before interest,
the word exists for banks, the total of interest received, operating financial lease charges, tax and extraordinary items
commission earnings, currency exchange earnings and other divided by the total of interest and operating financial lease
fee earnings have been used instead of turnover. charges paid.
DEFINITIONS OF THE MOST VITAL VARIABLES USED ❍ Debt to equity: The total of long-term interest-bearing debt
❍ Turnover: Total turnover as published by the company (for plus the total of short-term interest-bearing debt (including
banks refer to the paragraph above) overdraft facilities utilised) divided by total equity as defined
❍ Total assets: Fixed assets and current assets are included. above.
Investments are at market value or directors' valuation at latest ❍ Total serviced debt: The total of long-term interest-bearing
Statement of Financial Position date. Other assets, such as land debt plus the total of short-term interest-bearing debt (including
and buildings, are at book value. Where revaluations are not overdraft facilities utilised).
taken into the statement of financial position, these are ignored. ❍ Cash and cash equivalents: The total of cash, positive bank
Where cash balances are netted off against bank overdrafts, the balances and short-term loans dvanced.
cash balances are added back. Tax paid in advance is netted off ❍ Currency conversion: In cases where a company publishes its
against tax payable and only the net amount included. Cost of financial statements in some foreign currency, all financial
control and intangible assets, such as goodwill, patents and figures are converted to rand before the ratios for such a
licences, are not included — mining assets are, however, company is calculated. For figures in the statement of financial
included. Where amounts invoiced on contracts in progress position the exchange rate at financial year-end is used in the
exceed the value of the contracts in progress, the difference is conversion calculation. For figures in the income statement an
included with retained income; or, if the amounts received average exchange rate is used in the conversion calculation.
consist of deposits received, the difference is included with ❍ Annualisation: Financial statements not covering 12 months
creditors. If inventories are valued using last in first out (Lifo), it are annualised. If more than one financial period is reported on
is adjusted to reflect the first in first out (Fifo) or average value. in a calendar year, the results are consolidated and then
❍ Market capitalisation: Market capitalisation equals the market annualised. ■

FINANCIAL MAIL • TOP COMPANIES • 2016 5


Financial Mail Page 6 -29/08/16 02:21:48 PM

METHODOLOGY

Value-add counts
To make the Top 20, past governance; empowerment commitment;
strength of management; investability (value buy
performance matters as and tradability); as well as industry and company
much as perceived future profit prospects.
Scores were given in each of these areas, with
gains overall weighting being 60% for these qualitative
factors and 40% for the historic quantitative
information.
Thus there is both an objective and a

T
subjective element to the assessment and
he Financial Mail Top Companies ultimate selection of the companies that make
publication has, for more than a decade, the Top 20.
supplemented the traditional The point about the table is not that these
voluminous data with value-adding companies are just outstanding performers —
assessments. which they all are — but that they are expected to
The aim is to identify not only those again do much better than their peers.
companies that performed well in the The Financial Mail acknowledges that ranking
previous year by the various measures, but the JSE’s property companies on a net profit
which among them are likely to perform well basis, particularly property loan stock companies
again and also appear to offer investors value. (PLSs) — including sector heavyweights such as
The Top 20 winners are accordingly chosen Growthpoint, Redefine and Hyprop — is not
through a combination of historic financial necessarily the best way to compare the
performance and the analysis and judgment of performance of individual property stocks. PLSs
the Financial Mail’s team of investment writers. pay out profits in the form of an interest
The financial performance of all listed distribution to shareholders, which can render
companies has been assessed by INET BFA. Using the net profit number meaningless.
their figures, we first eliminated all companies However, most PLS companies have already
below R1bn in market cap to focus the (or are in the process of) converted to the new
assessment on large companies with significant real estate investment trust (Reit) structure that
investment potential. was adopted by the JSE in 2013. Under the Reit
Over the years INET BFA’s numbers have been dispensation, interest distributions are effectively
questioned because they do not always match a treated as dividends, which makes it more viable
company’s own financials, but the research firm’s to rank property stocks in a similar way to
approach is consistent and is explained in detail general equities.
under Definitions (see page 5). The Top 20 is not meant to be a list of
INET BFA aims to eliminate inconsistencies by bluechip companies — in fact, as a glance reveals,
standardising the treatment of the figures. For many of the JSE traditional blue chips are not
example, the ways companies treat foreign there. Rather, it’s an attempt to identify those
exchange conversions are brought into a companies that represent the best investment
common formula. opportunities.
We then weighed various financial To perform well in one year makes it even
performance indicators: earnings-per-share tougher the next year. Investors will reward a top
growth and internal rate of return were performer, which means that in time there will
measured over five years to ensure that the Top be less value on offer in the share price. Even
Companies were long-term performers. These two outstanding companies can be too expensive. If
factors counted 40% each. The remaining 20% their price-to-projected-earnings ratio is too
represented the most recent year’s return on high, it could take decades for the initial
equity to ensure the Top Companies were current premium to be repaid, if ever.
performers. The Top 20 companies, therefore, are those
We then took the top 40 companies that were that have unquestionably done well, but also
identified, based on financial performance, and have the potential (in the view of the Financial
assessed each one. The Financial Mail team Mail analysts) to deliver yet again even if they
examined a number of factors: corporate look expensive. ■

6 FINANCIAL MAIL • TOP COMPANIES • 2016


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The underdog

THE WINNERS
THE WINNERS

Calgro CEO Wikus Lategan explains it well when


he points out that Calgro is in fact a hybrid
company - a property development company
that also happens to develop and build on its own
properties. By being in control of the whole

makes its way to supply chain from beginning to end - owning the
land, through developing the properties and
contracting the actual construction work, and
finally to marketing the properties - the group is
able to reduce costs and obtain higher profit

the top margins. Lategan is rapidly becoming the


wunderkind of the SA construction industry; not
yet 35 years old, he joined the company as the
youngest financial director of a listed company in
SA in 2008.
Des de Beer

And as if this wasn’t sufficiently different


As the going got tougher Calgro showed grit and already, the group took the unusual step of
entering the funeral business in 2015.
adaptability to leapfrog to the top Additionally, it has partnered with Hollard
Insurance to provide funeral cover for burials at
Calgro’s new memorial park near Nasrec, south
of Johannesburg.

A
Listed on both the Luxembourg Stock
fter three years at the top position, the construction cycle”. Exchange and the JSE and headquartered in
inevitable occurred and Coronation was The share price has trebled since early 2014 Malta, Brait comes in at number two. Founded in
forced out of its dominant position by and yet its p:e ratio, at 13 times, is still well below the mid-1990s by well-known investment
Calgro M3, a plucky building and the average of the All Share Index. managers Mark Barnes, John Gnodde and Antony

Russell Roberts
construction operator that keeps on So what differentiates Calgro from its Ball as a “diamond in the rough,” Brait began life
reinventing itself in the face of difficult and competitors and allows it to flourish in such a as a private equity firm. Some years ago it
challenging conditions in the SA economy. One seemingly unattractive segment of the market? changed its focus to that of an investment
of the distinguishing factors between good and holding company and today it is primarily
great is not allowing adverse conditions to get Christo Wiese focused on UK clothing retailer New Look, UK
you down, but to rather grit one’s teeth and work frozen foods retailer Iceland, Virgin Active Health best-performing independent fund manager in
round a problem to find the solution. Clubs and Premier Foods. SA and has built up an enviable track record
Before talking about Calgro’s outstanding Its most successful investment to date has since its formation . Having been at the top of the
achievement, it is perhaps worth noting a couple undoubtedly been Pepkor, which it sold to rankings in Top Companies for the past three
of large trends that are apparent in this year’s Steinhoff International in 2014. It has been years, it was always going to be difficult to make
rankings compared with last year. First, there are difficult to replicate Pepkor’s success with the it four in a row but coming in at number four is
no insurance companies in the Top 20 this year; existing investment portfolio. certainly no disgrace.
last year, Liberty Holdings was at number two Net 1 UEPS began life in the late 1990s Global equity market valuations are currently
and Clientèle was at number 14. Second, there are small-cap listings boom as Aplitec, which riding on not much more than hot air at present,
no retailers this year – in 2015, Mr Price, concentrated on electronic taxi payments in with conviction levels being very low and
Woolworths and Clicks were well-placed in the those days. The strategic vision was, and still is, to fundamental growth across the globe being
Top Twenty. This is perhaps reflective of the very provide an electronic means of transacting extremely poor, with few exceptions. Cheap
tough conditions that South African consumers business for the billions of unbanked and money in the form of European quantitative
find themselves in, with the combined impacts of under-banked people of the world. Controversy easing, combined with historically low or even
lower wage growth, the weak rand and relentless still haunts the company, with criminal charges negative interest rates, is helping to sustain equity
cost increases. having being laid by the South African Social markets, but volatility is now very high and
Calgro finds itself in the unenviable position of Security Agency (SASSA) against Net 1 and investors are becoming increasingly nervous.
being categorised as a construction company. Grindrod Bank. Sassa awarded Net1 a contract to Against this type of background it is going to be
And despite the widely-held belief among the pay social grant recipients their grants difficult for investment companies to perform, no
governing party that South Africa is enjoying a electronically in 2012 and Net 1 arranged for matter how solid and professional they appear.
construction boom, that perception is not Grindrod Bank to provide the accounts. The basis Barring a dramatic improvement in underlying
reflected in the poor fundamental outlook for of the charges relates to Sassa alleging that Net 1 equity market performance up to the end of 2016,
construction companies generally. Thus making failed to act in terms of recently amended Coronation will likely struggle to maintain its top
Hetty Zantman

an investment case for a construction company is regulations to the Social Assistance Act, whereby ten ranking next year.
not an easy task. According to Orin Tambo of processing of deductions from bank accounts Micromega Holdings’ chairman is the
Intellidex, Calgro “continues to defy the narrative, held by Sassa recipients is limited. mercurial and charismatic Dave King, whose
delivering good results despite the deteriorating Coronation Fund Managers is, arguably, the other main claim to fame is being chairman of

8 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 9
Financial Mail Page 10 -29/08/16 02:22:35 PM

THE WINNERS

Glasgow Rangers Football Club. Having come to the future with eager anticipation. Now widely
an agreement with SARS some time ago, King diversified, the most interesting investments are
has more recently been able to devote his Pioneer Foods and recently listed Sygnia, an asset
energies to running Micromega. This is a solid management company.
business with interests in technology and health Discovery hardly needs any introduction,
& safety. The share price halved in the past year having been a positively disruptive force in all
as earnings growth came off significantly, the areas in which it operates for two decades. By
reflecting the relatively pedestrian South African far the leader in the medical aid industry, the
economy. group has successfully diversified into life
Having reinvented itself with new assurance, short-term insurance and investment
management, Supergroup is firmly back on track. management and is believed to be concentrating
Resilient, controlled by property guru Des de on establishing a bank. EOH’s remarkable
Beer, is now spreading its wings again, this time earnings growth carries on unabated, even
with Europe-focused Greenbay and the hope is though its share price trajectory has stuttered in
obviously that this new venture can emulate the the past year.
outstanding success of New Europe Property Finbond appears to be destined to become
Investments and Rockcastle before it. Adapt IT is one of the leading players in the “fintech”
sometimes referred to as a “mini-EOH,” which is industry in South Africa in future. Reinet has an
quite an accolade. Although operating anywhere innate ability to defy the sceptics. The Rupert
in Africa outside SA is tough, Adapt IT has paid its touch - a reference to the company’s chairman
dues and fully expects to increase its earnings and founder, Johann Rupert - is alive and well in
Reinet. Critics
Aspen HQ the hub of sometimes rather
a new global giant unkindly refer to Reinet
as being “the Rupert
family’s private equity
fund”.
Aspen has recovered
from its hiccup year and
appears to be back on
the growth path.
Firstrand remains the
banking analysts’
favourite stock in the
banking sector, and
Bloomberg/Waldo Swiegers

Torre looks like it may


well be acquired by
Christo Wise’s Stellar
Capital.
Hopefully, Howden
management will
enlighten its
shareholders as to what
from the rest of the continent in future. it intends doing with its large cash pile as the
Life Healthcare was unbundled from year progresses.
industrial gas supplier Afrox over a decade ago In hindsight, City Lodge may have expanded
and has enjoyed great success ever since. too rapidly in the run-up to the 2010 FIFA World
Although the smallest of the three major private Cup, which left them and all other SA hotel
hospital groups in terms of market capitalization, groups with too much spare capacity. But the
Life has a strategy to expand offshore. Currently group’s careful strategy of identifying great sites
it is invested in India and Poland. and putting hotels on them in different parts of
African Equity Empowerment Investments the country has resulted in a gradual
(AEEI) used to be called Sekunjalo Investments, improvement in occupancies.
whose main claim to fame was its disastrous PSG’s mixed bag of investments has resulted
holding in the health and racquets chain in a relatively poor share price performance in
Leisurenet, which collapsed spectacularly at the the past year. Capitec and Curro have been the
beginning of last decade. Now, with a new name star performers, while Zeder and Pioneer Foods
and a string of very successful acquisitions, those have been pedestrian.
days are long gone and investors are looking to Staff writer

10 FINANCIAL MAIL • TOP COMPANIES • 2016


Financial Mail Page 11 -29/08/16 10:37:39 AM
Financial Mail Page 12-13 -29/08/16 02:23:03 PM

1 CALGRO HOLDINGS
11 DISCOVERY LTD

Bloomberg News/Chris Ratcliffe


Calgro’s positive growth path
Total score: 74.3 lifts it into first place Discovery, the only life Total score: 59.0
insurer loved by its
Historic score: 74.3 FM’s score: 46.8 healthy customers Historic score: 11.6 FM’s score: 47.4

In fourth place last year, Calgro M3 Holdings now Starting off as a medical aid administrator, Discovery
moves up to first position, on a very positive is now a life insurer, short-term insurer and asset
operational growth path. For the year ended February manager. It has also expanded its interests offshore,
2015, financial results showed profit after tax up with varying degrees of success. Its asset
37.9% to R145.7m; and headline earnings per share up management business has recorded outstanding
31.9% to 109.69c. It continues its prosperous success since starting from scratch in 2007. It has to
trajectory, with final results for the year ended be the only life insurer which is loved and adored by
February 29 2016 exhibiting a 91.2% improvement in its healthy customer base. Banking is the next step for
operating profit and profit after taxation up 32.6%. this innovative group.

2 BRAIT SE
Total score: 71.8 Remarkably few meaningful new
acquisitions made by Reinet
12 EOH HOLDINGS LTD
Total score: 58.9
Historic score: 27.4 FM’s score: 44.4 Historic score: 17.5 FM’s score: 41.4

This investment holding company has stakes in The EOH team has been very good at identifying
Steinhoff, Premier Foods, New Look, Virgin Active and medium-sized start-ups, acquiring them, and then
Iceland. With so much of its value found in the UK and rolling their earnings into those of EOH. It trades on

Bloomberg News/Jack Atley


Europe, the uncertain prospects of the recent Brexit an expensive p:e of 28 but always manages to deliver.
advisory vote may impact operations. It has Its various business components are well entrenched
successfully tapped the European debt markets, so is across the IT value chain. It has profound management
getting nicely priced money; and is on the lookout for

iStock
expertise in depth. Since peaking at around R180 in

Sunday Times
a couple of acquisitions, it is very sharp at acquiring August 2005, the share has since retreated
target businesses at good prices. significantly to below R140.

3 NET 1 UEPS 5 MICROMEGA


Total score: 66.1
Total score: 66.7
Historic score: 26.5 FM’s score: 40.2
Historic score: 24.1 FM’s score: 42.0
9 LIFE HEALTHCARE
Total score: 59.2
13 FINBOND GROUP
Total score: 57.7
Historic score: 21.7 FM’s score: 21.7
This is a small-cap stock, very much reliant on
Historic score: 10.0 FM’s score: 49.2
This company can trace its roots back to a company the local economy, and focused on real and basic
called Aplitech, which was listed on the JSE in the late services. In the year to end-March 2016, headline This is a very expensive but most interesting business,
1990s. Also listed on Nasdaq, this group is a payment earnings per share rose by 22% and the Life Healthcare, with its sizable and credible operations, is moving perhaps at times emulating Capitec. It is notably
solutions and transaction processing services. The dividend was increased by 23% to 43c/share. into developing markets similar to SA and recently acquired trying to become more dynamic and follows an
group has recently emerged from a nasty Though very strong, this performance was way stakes in hospital groups in India and Poland. There is huge aggressive internationalisation strategy, moving into
constitutional court issue relating to its role as below market expectations. Earnings growth was potential in India as the population is not well served in terms of the US where pay day loans are big business, though
electronic distributor of SA’s social grant payments. stunted by an unanticipated deferred tax charge healthcare. Debt for global acquisitions has been raised locally tightly regulated. It has Net 1 UEPS Technologies as a
Net 1 retains the social grant contract until 2017. The of R5.5m due to the recent increase in the rate and this strategy could be hurt by adverse currency moves. The shareholder, as well as US-based hedge fund Riskowitz
Once a takeover target, Supergroup Capital Management. A few years ago its share price
share is tightly held, and does not trade that often. of capital gains tax. is driving overseas growth share price has gone sideways for quite a few years.
shot up out of nowhere, attracting investors.

4 CORONATION FUND
Total score: 66.3 6 SUPERGROUP LTD
Total score: 65.0 7 RESILIENT
Total score: 64.6 8 ADAPTIT HOLDINGS
Total score: 63.2 10 AFRICAN EQUITY
Total score: 59.1
14 REINET
Total score: 57.2
Historic score: 26.1 FM’s score: 40.2 Historic score: 23.0 FM’s score: 42.0 Historic score: 18.4 FM’s score: 46.2 Historic score: 21.2 FM’s score: 42.0 Historic score: 18.3 FM’s score: 40.8
Historic score: 11.6 FM’s score: 45.6
In first place for the last three years, our previous Top Focused on fleet management, supply chain Now shying away from Africa, and Nigeria in Somewhat comparable with EOH, AdaptIT is an IT The share price languished between about 50c
Companies report speculated that Coronation was in logistics and car dealerships, Supergroup is particular because of the oil price, the naira and application solutions provider in the and 80c for a number of years before rising Created in 2008 from the unbundling of the
with a shout when it comes to the top three in this growing its footprint in Australia and has trade policy, Resilient’s growth focus is firmly on manufacturing, mining, higher education and virtually exponentially between mid-2014 and Remgro-Richemont-BAT group, Reinet is a
year. Our forecast materialised at just one position valuable interests in the UK and Europe. More Europe. Flushed with success from its New financial services sectors. Its share price has had late 2015. Clever acquisitions were behind this Europe-based investment vehicle. It has a big stake in
out. than half of its earnings now come from Europe Property Investments and Rockcastle a meteoric rise over the past few years and CEO rise. This renamed Sekunjalo group saw a boost British American Tobacco (BAT), and other investments
Its full year results to September 2015 noted that offshore. Once a possible takeover target ventures recently, the group has launched a new Sbu Shabalala is an equally visible leader. It is in earnings by 67% in the half year to February in financial services and property. Reinet’s underlying
market volatility intensified throughout the year. because of its small market cap, the company is vehicle called Greenbay - a hybrid fund that dedicated to far greater expansion into the rest 29 2016, with revenue up by 18%, and costs and investment case remains driven by BAT and it is
Subsequent interim results to Match 2016 show this now respectably sized. There is an underpin for invests in European property. Greenbay recently of the African continent. Adapt IT’s diversified debt under control. The group recently acquired remarkable how little has been achieved by this
state of affairs continues, with revenue and earnings continued growth from offshore earnings in hard purchased its first asset in Europe, a shopping set of interests helps to mitigate its risk interests in Sygnia and Saab Grintek Defence. investment vehicle in terms of making meaningful
declining once again. currency, with the depreciating rand. centre in Koper, Slovenia, for ¤56m in cash. exposure to certain industries. Further deal announcements are expected. acquisitions since its formation.

12 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 13
Financial Mail Page 14 -29/08/16 02:23:21 PM

15 ASPEN PHARMA
Total score: 57.1 16 FIRSTRAND
Total score: 56.2 17 TORRE INDUSTRIES
Total score: 55.7
Historic score: 12.1 FM’s score: 45.0 Historic score: 10.0 FM’s score: 46.2 Historic score: 16.1 FM’s score: 39.6

Aspen is now in a new phase of growth as it This group was formed in 1998 by merging the Torre CEO Charles Pettit is an exceptionally
becomes a huge global operation. For a group financial services interests of Anglo American sharp entrepreneur. The strategy is to acquire
which is only 16 years old, its huge market cap Corp and RMB Holdings. Though Firstrand has good old-fashioned industrial businesses that are
of R169bn as at end July 2016 is impressive. been a full-service banking and financial services not flavour of the moment. The share price has
Money raised in Europe’s credit markets is being operation since 1998, that innovation and flair slumped from a high of 519c in February 2015 to
used to acquire key strategic assets from still shines through. This banking, investment and its current (July 2016) level of just over 200c.
European drug makers. The share price had quite insurance group is a leader in the SA banking Stellar Capital has made an offer to buy out
a precipitous fall after peaking at around technology, which perhaps goes some way in Torre’s minority shareholders by offering them
R450/share in early 2015. Positively, the Glaxo explaining why it has the largest market 1.25 Stellar shares per every Torre share held by
overhang now seems to have dissipated. capitalisation of any of the “Big Four” SA banks. them.

Freddy Mavunda
iStock

No frills City Lodge


enjoying respectable if
unspectacular Capitec still the jewel in
occupancies Aspen has become a the PSG Group’s
huge global operation diversified portfolio

18 HOWDEN AFRICA
Total score: 55.0 19 CITY LODGE
Total score: 54.4 20 PSG GROUP
Total score: 53.9
Historic score: 14.8 FM’s score: 40.2 Historic score: 10.0 FM’s score: 44.4 Historic score: 11.3 FM’s score: 42.6

This group designs, manufactures and markets This small hotelier differentiates itself by owning Founded by investment guru Jannie Mouton in
specialised air and gas solutions. It is facing a the properties from which it operates as well as the 1990s, PSG Group has grown to become a
challenging time at the moment with an offering a “no-frills” hotel experience. It is diversified investment holding company with a
uninspiring outlook. For the year ended enjoying the tourism benefits from a weak rand, chunky market capitalisation of over R40bn.
December 31 2015, revenue declined by 6.6% and its current occupancy rate of 69% is more Private school group Curro is a bright spark in
and operating profit was down by almost 20%. than respectable, though it’s a long way off its its investment suite and that company’s listed
Power generation remains the group’s largest high of around 83% a few years ago. The group share price doubled in 2015. The real jewel in
revenue producer but it dropped by 6% to 54% is benefiting from caps on travelling expenditure PSG’s crown, however, is Capitec, one of the
in 2015. The group is sitting on a huge cash pile by government employees. African expansion most iconic financial services companies in South
and yet does not intend paying a dividend. also continues at a manageable pace. Africa.

14 FINANCIAL MAIL • TOP COMPANIES • 2016


Financial Mail Page 15 -29/08/16 10:38:56 AM

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Shrinking giants regulatory hurdles left to surmount in this deal, penetration in emerging markets is exceptionally

SA GIANTS
SA GIANTS

which should be consummated before the end of low, so there are opportunities for growth, despite
2016. Its main stock exchange listing is in overall economic conditions in these countries
Belgium but it has an American Depository being weak. Life assurance companies tend to be
Receipt in New York and secondary listings in proxies for equity markets and the languid stock

in shrinking Mexico and in Johannesburg, fast-tracked in just


three weeks at the beginning of 2016.
Anglo American has refined its portfolio
extensively in recent years and is now focused
on shallow platinum mining and its
market experienced in 2015 and the first half of
2016 has done Sanlam no favours.
Industrial conglomerate Bidvest Group has just
been split in two listed entities – the Bidcorp
food services business, which is internationally

sectors well-branded diamonds through De Beers. It also


has a presence in copper, iron ore and coal.
Diamond prices have been less volatile than
other commodities, although trading conditions
were tough last year and distressed sales put
diversified, has been driving group growth, and
offers a Rand hedge; and the SA Bidvest
Industrial segment, which is a mixed bag of
Adcock Ingram investment, financial services,
travel and vehicle distribution, among others.
pressure on prices. The group was compelled to While this Bidvest rump is considered to be very
The recent downturn in commodity prices has taken away cut back on diamond production in order to limit local, it has plans to make offshore acquisitions
stocks, but the supply/demand situation has now and will then able to offer rand hedge benefits to
much of the big firms’ allure stabilised. The new consolidated group structure some extent.
is much improved, debt is going down, it is often Liquid fuel and chemicals group Sasol has had
the lower-cost producer in its commodity space, to pull back on some of its international capital
and hopefully it’s getting the Brazilian iron ore development due to a collapsed oil price,

R
operation, Minas-Rio, up to speed and into specifically the GTL project in Louisiana, USA, but
anked by turnover, these are the largest criticise the group for selling assets at the bottom saleable condition. remains committed to its US ethane cracker
listed companies in SA. Until recently, of the cycle, though given its situation, it had few British American Tobacco (BAT) is a firm project which still makes sense at current price
their ranks were dominated by the options. Diversification in terms of production favourite among value portfolio managers, levels. Loved for its rand hedge properties, it
large resources companies but many of and trading, and across commodity types, works due mainly to its very defensive qualities. cannot simply rely on rand weakness and
these have been savaged in the in its favour. The company is not home and dry This might appear strange, given the needs a convincing uptick in the oil price.
profound downturn in commodity prices in yet, but is certainly in better shape than several relentless opposition it and all other But although the oil price rose sharply in
recent years. They used to be found in profusion months ago. tobacco companies face from health the first few months of 2016, further
among the investment The world's largest authorities all round the world. And yet profound appreciation appears limited.
portfolios of most of the large SA GIANTS diversified natural resources BAT still manages to produce very strong MTN’s enormous Nigerian fine of $1.7bn
SA financial institutions but Glencore Plc group, BHP Billiton, is a leaner earnings growth in hard currency and was has dominated its headlines for several
recent events have taken away Anglo American Plc business after the carve-out of recently highlighted as a stock that could do months, having been reduced from an
much of their allure. In BHP Billiton Plc South 32, but is still struggling well amid all the turmoil taking place on initial fine of over $5bn. Being
addition, the weak rand has Anheuser-Busch InBev (listed Jan 15 2016) somewhat and taking huge the London stock exchange in the the only operator in that
SABMiller Plc
had the effect of magnifying 180
write-downs, especially on its wake of the recent British country to be massively
turnovers, as the bulk of their 160
on-land US natural gas assets. referendum result to leave the fined on the issue of SIM
revenues tend to be The share price took a big fall EU. card registration, MTN
140
denominated in hard when oil dropped sharply in Sanlam says it has just explained the
currencies such as the US 120 mid-2014 from its $110/barrel come out of a particularly complexities giving rise
dollar. 100 peaks, and has hardly bad year, in fact the worst to the multi-billion
Glencore started off life as a recovered since then. Like all since the 2008 global dollar penalty. In

Martin Rhodes
80
commodities trader, then its peers it is reducing capital financial crisis, with 2016/17 comparison to other
60
buying Xstrata at the very top expenditure and trying its best not expected to be much Nigerian telcos, its
of the cycle and getting into 40 to restructure, and had to cut easier for the financial scale is much more
commodities production. It is 20 the dividend for the first time services group. The South significant, as is its
run out of Switzerland by J F MA M J J A S O N D J F M AM J J A in almost 15 years in an effort African business has been far-reaching
SA-born Ivan Glasenberg, and 2015 2016 to defend its balance sheet and shaken up and modernised geographic presence,
Source: IRESS Share prices based to 100
listed in London with a credit rating. Like its and the international and these factors make the
secondary listing in commodity peers, and despite emerging-market strategy put complex task of collecting
Johannesburg. It has a huge amount of debt on a good start to 2016, Billiton’s share price could be in place. Despite tough times in customer biometrics and
the balance sheet, coming from past volatile for a while until something triggers a developing economies, and other personal data even
deal-making, and was plagued by rumours last fundamental trend reversal. Africa in particular, the group will more of a challenge. It
year to the effect that it in fact might go Anheuser-Busch/Inbev is the world’s largest stay the course with this strategy, concedes that the pace of
bankrupt. The focus is now on streamlining the brewer and at the time of writing (July 2016) had acknowledging that times will be disconnection of customers
business, cutting expenses and capital spend, and received conditional approval from the South challenging, but hopefully its with incomplete data could
getting the debt under control, helped by a African competition tribunal in respect of its competitors will stay away from have been faster, but it was
Ivan Glasenberg
reduced dividend and equity-raising. Analysts takeover of SABMiller. There were very few other these difficult spots. Insurance trying to accommodate

16 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 17
Financial Mail Page 18 -29/08/16 02:24:06 PM

customers with information that was almost to Cell C. The little bit of good news is the lifting
SA GIANTS

complete. It defends its alleged lack of of sanctions against Iran and this market could be
communication on this matter, explaining the promising for MTN. The group needs to work
sensitivity of the Nigerian telecoms regulator and hard to restore its former glory and investor
the acrimonious relationships in play. Back in SA, confidence.
the telecoms giant has been losing market share Staff writer

ASSET HEAVYWEIGHTS partnership with The Caryle Group, would be


interested in buying the non-South African
Top miners going on assets.
Like Barclays Africa, Nedbank also has a “for
strict diet sale” sign hanging above it, as Old Mutual has
indicated it will be sold off as part of the greater
Perhaps unsurprisingly, this section is Old Mutual restructuring. This overhang is likely
dominated by financial services companies like to create a lid on the share price.
banks and insurance companies, with a few Though Investec is very different to the big
diversified mining companies and large four commercial banks in South Africa, it has
industrial companies making an appearance as managed a good recovery from the global
well. financial crisis of 2008. Impairments and
Old Mutual Group had a torrid time after default levels have come off because of the
listing in the late 1990s and in hindsight made higher-end nature of the client base. The group
some bad acquisitions. Stabilised and has sold off a few businesses and is now much
resuscitated under Julian Roberts after coming more streamlined. The cost-to-income ratio is
seriously off the rails in the wake of the global trending down and the return-on-equity profile
financial crisis, it has curtailed its global in the core bank continues to improve. Investec
expansion plans, staying with a strategy that is not interested in adding to emerging market
focuses more on emerging markets. Now under exposure but is rather staying in developed
new CEO Bruce Hemphill who has plans for a markets where banking ROEs are lower.
major restructuring, including the disposal of Sanlam’s share price has been under
the wealth business in the UK, the market pressure in 2016, notably as a result of the fairly
awaits the finer details of what the streamlined pedestrian performance of the JSE during that
group will look like after restructuring. period. In its four-month trading period to
Like Old Mutual, Standard Bank has slimmed end-April 2016, new business volumes rose by
down its international operations, probably as a 9%. Sanlam Investments’ new business volumes
direct response to instructions from 20%-owner increased by 5%. Emerging markets are making
ICBC of China. The group is in recovery mode, a growing contribution to earnings and on
has given up firmly on its global ambitions and March 1 its Moroccan acquisition, Saham
is consolidating its position within South Africa. Finances, began making contributions to group
It is difficult to discern the value that ICBC has earnings.
added to the group. Glencore, BHP Billiton and Anglo American
First Rand remains the darling of the will probably still retain their status as asset
banking sector among institutional portfolio heavyweights long after their considerable
managers. Although it is experiencing some asset sales have taken place. The possible
funding pressures, it still offers a good dividend exception to this broad statement is Anglo
yield and a high return on equity. American, which is being slimmed down to
Barclays Africa Group has cleaned up its loan having interests in just three areas: diamonds,
book in recent years and has established what platinum and copper.
is arguably the best banking network in Africa British American Tobacco continues to defy
of any of the big four South African banks. UK the odds, by making good profits from what is
parent Barclays plc has signalled its intention to perceived by many as a dying industry. At the
sell down its stake considerably and has already heart of this performance is their collection of
reduced it to just above 50%. The overhang so-called global drive brands — Kent, Dunhill, Pall
caused by Barclays’ announcement is likely to Mall and Lucky Strike — which collectively
keep a lid on the share price until more clarity account for almost a quarter of volumes sold
emerges about a potential buyer, in whole or in and which have driven sales higher by 62% in
part. Former Barclays CEO Bob Diamond has the past 15 years.
confirmed that his company Atlas Mara, in Staff writer

18 FINANCIAL MAIL • TOP COMPANIES • 2016


Financial Mail Page 19 -29/08/16 10:39:41 AM
Super Group - Financial Mail Advert - 2016 - Final Approved.pdf 1 2016-08-19 03:23:49 PM

Y
Financial Mail Page 20-21 -29/08/16 02:27:12 PM

NO. 4 SABMILLER NO. 21 VODACOM


Heady march to mega brewing Placed to gain from MTN's
deal troubles

SA GIANTS SA GIANTS
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end turnover Rm Rm Rm Rm Rm year-end

19 Barclays Africa Group 84,885 987,230 156,833,875 78,661 13,486 Dec 14


1 Glencore Plc 2,178,175 1,853,256 481,928,050 1,013,758 50,591 Dec 15 18 77,293 955,298 126,314,851 73,657 12,204 Dec 13
1 2,398,151 1,629,582 685,032,937 858,478 27,825 Dec 14 20 Massmart Holdings 78,173 25,229 32,568,597 4,734 1,251 Dec 14
2 BHP Billiton Plc 667,734 1,823,650 350,603,918 1,331,644 99,700 Jun 15 20 72,263 22,535 29,852,559 3,991 1,130 Dec 13
2 729,036 1,601,838 567,862,179 1,179,938 160,449 Jun 14 21 Vodacom Group 77,333 63,563 238,861,255 17,850 13,818 Mar 15
3 Anheuser-Busch Inbec SA/NV 557,060 591,916 2,961,095,457 773,379 115,694 Dec 15 19 75,711 55,312 197,436,616 18,229 15,259 Mar 14
22 Datatec 76,023 35,314 9,628,331 11,523 1,151 Feb 15
4 SABMiller Plc 265,909 317,226 1,505,781,568 330,394 41,839 Mar 15 27 59,684 25,463 12,216,878 9,238 928 Feb 14
5 235,952 313,992 1,065,559,985 333,595 41,647 Mar 14 23 The Spar Group 73,259 16,011 34,481,225 2,829 1,662 Sep 15
5 Anglo American Plc 261,322 739,806 162,359,644 433,759 7,589 Dec 15 31 54,483 14,356 32,691,397 2,387 1,349 Sep 14
3 293,682 697,305 258,254,715 482,001 22,390 Dec 14 24 Naspers 73,092 802,250 902,492,528 755,846 13,566 Mar 15
6 British American Tobacco Plc 255,753 930,377 1,744,280,965 531,797 81,426 Dec 15 26 62,728 535,165 783,910,488 503,851 8,985 Mar 14
4 249,516 558,335 1,274,789,915 356,780 64,759 Dec 14 25 Pick n Pay Stores 66,941 13,498 34,308,750 2,460 1,007 Feb 15
7 Sanlam 238,190 667,815 148,381,653 50,525 -675 Dec 15 24 63,117 12,905 24,098,088 2,118 835 Feb 14
6 207,376 604,430 169,786,395 43,660 5,328 Dec 14 26 Pick n Pay Holdings 66,941 13,498 15,005,508 1,182 607 Feb 15
8 The Bidvest Group 204,916 73,323 125,105,771 34,958 5,940 Jun 15 25 63,117 12,905 11,335,855 1,002 564 Feb 14
8 183,645 67,002 110,161,424 30,654 5,316 Jun 14 27 Sappi 64,765 65,315 35,394,339 15,202 2,571 Sep 15
9 Sasol 185,266 316,928 287,614,526 231,289 38,125 Jun 15 23 64,099 59,767 26,492,963 13,294 1,544 Sep 14
7 202,683 273,486 268,277,708 202,590 40,083 Jun 14 28 Barloworld 62,720 43,954 16,079,559 18,719 2,490 Sep 15
10 MTN Group 146,930 215,394 378,719,160 123,726 28,606 Dec 14 22 64,884 40,191 21,446,660 16,079 2,333 Sep 14
10 136,495 186,167 403,555,659 112,768 29,032 Dec 13 29 Anglo American Platinum 59,829 73,960 97,592,480 67,693 2,437 Dec 15
11 Compagnie Financiere Richemont SA 143,389 293,087 508,897,800 200,733 27,397 Mar 15 30 55,626 92,642 80,235,754 85,571 1,213 Dec 14
9 152,839 206,295 510,046,200 153,089 29,523 Mar 14 30 Old Mutual Plc 57,311 2,515,668 198,369,643 121,977 12,680 Dec 14
12 Steinhoff International Holdings NV 136,967 177,986 375,142,733 181,916 8,527 Jun 15 29 55,910 2,382,841 173,402,517 115,730 14,064 Dec 13
11 135,865 134,411 262,286,731 87,809 9,483 Jun 14 31 Woolworths Holdings 56,506 23,706 93,753,800 11,393 3,707 Jun 15
13 Standard Bank Group 122,795 1,879,172 271,884,790 134,111 15,507 Dec 14 34 39,707 18,524 87,530,795 4,894 3,287 Jun 14
12 112,358 1,670,647 224,600,570 126,388 15,309 Dec 13 32 AngloGold Ashanti 54,666 172,875 83,299,023 58,963 -1,610 Dec 15
14 Shoprite Holdiings 113,694 41,949 99,462,029 17,151 4,785 Jun 15 28 58,036 156,146 47,194,463 47,574 2,528 Dec 14
14 102,204 38,837 94,105,676 15,797 3,917 Jun 14 33 Kumba Iron Ore 47,597 50,028 50,245,411 29,139 11,364 Dec 14
15 Imperial Holdings 110,487 57,466 30,498,454 18,559 3,449 Jun 15 32 54,461 43,618 121,748,498 22,986 15,286 Dec 13
13 103,567 51,143 40,089,736 17,141 3,363 Jun 14 34 South32 45,550 180,001 88,214,751 151,241 -1,203 Jun 15
16 Mondi 92,187 79,190 27,432,046 38,328 7,704 Dec 14
15 83,048 79,863 21,877,252 39,289 5,771 Dec 13 35 Aveng 43,930 25,258 1,625,016 11,616 -1,043 Jun 15
17 Mondi Plc 92,187 79,190 85,567,107 38,328 7,704 Dec 14 33 52,959 28,600 4,683,381 12,239 327 Jun 14
16 83,048 79,863 67,851,411 39,289 5,771 Dec 13 36 MMI Holdings 42,652 433,235 39,166,283 27,178 3,296 Jun 15
18 FirstRand 88,198 1,056,543 271,330,934 83,591 21,471 Jun 15 38 34,685 400,969 51,591,423 26,633 3,715 Jun 14
17 77,455 943,399 313,233,809 75,044 18,716 Jun 14 37 Liberty Holdings 42,139 374,909 48,039,068 22,024 2,930 Dec 14
36 35,782 349,810 35,589,265 19,838 2,836 Dec 13

20 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 21
Financial Mail Page 22-23 -29/08/16 02:27:47 PM

NO. 44 GOLDFIELDS NO. 60 MR PRICE


Rand gold price to the rescue Defying tough times for
consumers

SA GIANTS SA GIANTS
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end turnover Rm Rm Rm Rm Rm year-end

38 Aspen Pharmacare Holdings 36,127 38,969 146,114,571 33,646 5,966 Jun 15 57 Super Group 19,818 12,253 15,670,488 4,910 749 Jun 15
43 29,515 36,308 175,237,838 28,550 5,259 Jun 14 66 14,297 9,712 10,957,859 4,130 787 Jun 14
39 Netcare 33,711 27,342 52,760,503 11,793 2,590 Sep 15 58 Distell Group 19,589 15,806 34,871,168 9,647 1,414 Jun 15
40 31,783 23,708 61,680,629 10,593 2,279 Sep 14 57 17,740 13,987 33,965,728 8,683 1,414 Jun 14
40 Telkom SA Soc 32,802 38,938 30,336,436 24,164 3,334 Mar 15 59 Pioneer Food Group 18,748 11,469 32,295,294 6,991 1,346 Sep 15
39 32,723 36,551 41,246,084 22,774 5,152 Mar 14 52 21,290 12,217 41,338,205 6,495 1,196 Sep 14
41 Impala PLatinum Holdings 32,477 77,021 34,534,583 101,032 -4,688 Jun 15 60 Mr Price Group 17,285 7,387 45,011,128 3,954 2,293 Mar 15
44 29,028 79,190 37,193,165 107,347 -568 Jun 14 65 15,227 6,196 65,830,337 2,946 1,863 Mar 14
42 Tiger Brands 31,558 23,962 62,466,883 16,412 3,679 Sep 15 61 AECI 16,903 12,651 15,388,936 6,672 1,036 Dec 14
42 30,259 22,514 58,656,216 14,585 3,008 Sep 14 59 15,942 12,659 16,286,624 6,278 757 Dec 13
43 Arcelormittal SA 31,141 30,850 8,876,866 13,492 -5,557 Dec 15 62 Omnia Holdings 16,835 11,378 9,322,042 6,943 1,227 Mar 15
37 34,852 32,873 8,415,800 21,948 -762 Dec 14 58 16,259 10,025 11,780,603 6,055 1,080 Mar 14
44 Gold Fields 31,120 130,039 39,927,710 47,969 933 Dec 14 63 Exxaro Resources 16,401 58,687 35,990,608 49,502 1,099 Dec 14
41 30,628 126,166 31,229,091 46,180 2,633 Dec 13 68 13,568 76,812 50,136,170 69,889 5,941 Dec 13
45 Murray & Roberts Holdings 30,655 17,300 5,603,675 5,834 424 Jun 15 64 Tongaat Hulett 16,155 26,103 14,111,150 14,151 1,161 Mar 15
35 38,064 18,634 6,088,437 5,417 981 Jun 14 61 15,716 23,568 18,172,632 12,464 1,267 Mar 14
46 Wilson Bayly Holmes-Ovcon 29,794 13,358 7,519,617 4,056 614 Jun 15 65 KAP Industrial Holdings 16,138 14,241 15,744,039 8,399 1,081 Jun 15
47 25,777 12,319 7,436,220 4,129 330 Jun 14 60 15,793 14,180 12,913,588 7,351 941 Jun 14
47 Oando Plc 27,974 42,141 6,813,514 26,454 -11,415 Dec 14 66 The Foschini Group 16,086 13,814 30,459,229 7,454 1,868 Mar 15
45 27,870 36,423 9,908,113 17,741 40 Dec 13 67 14,159 16,627 38,101,182 6,320 1,781 Mar 14
48 Discovery 27,694 83,866 78,662,495 30,388 6,717 Jun 15 67 Capitec Bank Holdings 15,701 53,369 66,257,734 10,362 2,547 Feb 15
49 23,090 67,200 80,799,007 20,411 4,326 Jun 14 69 13,526 45,778 60,705,326 8,981 2,088 Feb 14
49 Allied Electronics Corp A 27,623 13,449 517,778 3,370 416 Feb 15 68 Lonmin Plc 15,536 32,298 7,926,875 42,285 -5,924 Sep 15
46 27,772 14,120 1,479,367 4,022 707 Feb 14 81 10,205 43,652 12,350,499 72,034 -1,206 Sep 14
50 Remgro 25,590 145,291 120,363,191 129,788 8,437 Jun 15 69 Harmony Gold Mining Company 15,435 59,155 23,169,558 30,877 -450 Jun 15
48 24,621 116,543 127,878,073 109,643 6,743 Jun 14 62 15,682 67,410 9,219,033 35,462 249 Jun 14
51 Santam 24,319 26,878 27,028,251 7,440 2,000 Dec 15 70 LifeHealthcare Group Holdings 14,647 12,627 37,409,103 4,456 1,755 Sep 15
50 22,710 23,927 26,920,971 6,600 1,729 Dec 14 71 13,046 9,238 44,095,894 4,168 1,893 Sep 14
52 RCL Foods 23,727 13,999 13,081,726 11,303 1,036 Jun 15 71 Group Five 13,876 10,225 2,372,053 2,907 86 Jun 15
54 20,204 14,112 16,032,022 10,557 242 Jun 14 64 15,360 9,887 2,820,750 2,553 372 Jun 14
53 Sibanye Gold 22,717 49,598 51,918,789 20,784 1,289 Dec 15 72 Grindrod 13,769 30,877 13,268,427 17,212 645 Dec 14
51 21,781 49,838 23,688,937 20,443 1,783 Dec 14 63 15,524 27,548 15,319,515 11,883 678 Dec 13
54 Clicks Group 22,070 6,876 23,919,667 1,429 979 Aug 15 73 Rand Merchant Inv Holdings 13,692 50,309 61,834,348 34,285 3,014 Jun 15
56 19,150 5,590 22,506,837 1,113 829 Aug 14 75 10,801 40,593 68,727,942 27,885 3,233 Jun 14
55 Blue Lable Telecoms 22,044 5,735 10,286,262 3,719 630 May 15 74 Adcorp Holdings 13,322 3,264 1,649,320 2,358 381 Feb 15
55 19,402 5,469 5,868,228 3,375 529 May 14 72 11,802 2,684 3,491,115 2,019 285 Feb 14
56 Nampak 20,616 20,132 14,668,234 8,407 1,388 Sep 15 75 Illovo Sugar 13,267 14,421 9,514,086 7,612 998 Mar 15
53 20,901 18,327 28,589,481 7,570 1,412 Sep 14 70 13,190 13,432 10,956,172 7,210 1,132 Mar 14

22 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 23
Financial Mail Page 24-25 -29/08/16 07:17:44 PM

NO. 90 CLOVER NO. 101 NORTHAM


New structure has paid off PLATINUM
Glory days seem far off

SA GIANTS SA GIANTS
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end turnover Rm Rm Rm Rm Rm year-end

76 Hosken Consolidated Investments 12,479 30,761 11,784,354 16,828 3,858 Mar 15 95 Hulamin 8,395 6,569 1,965,520 4,321 -30 Dec 15
87 9,201 23,848 15,253,807 14,522 1,130 Mar 14 91 8,039 6,184 2,716,573 4,206 318 Dec 14
77 Tsogo Sun Holdings 11,343 17,757 24,802,648 8,165 1,766 Mar 15 96 Trencor 8,055 53,617 10,889,682 9,134 1,004 Dec 14
76 10,767 13,773 28,957,406 10,614 2,034 Mar 14 99 6,590 44,304 11,527,127 7,950 1,197 Dec 13
78 Truworths International 11,290 8,435 42,658,073 6,637 2,472 Jun 15 97 Net 1 Ueps Technologies Inc 7,997 16,578 6,749,659 7,489 1,399 Jun 15
79 10,458 7,764 37,760,669 5,827 2,378 Jun 14 102 6,310 12,519 8,330,434 5,174 977 Jun 14
79 Astral Foods 11,266 4,661 4,747,790 2,559 786 Sep 15 98 Pinnacle Holdings 7,912 3,407 2,732,943 1,537 293 Jun 15
84 9,602 4,206 7,696,617 2,273 357 Sep 14 95 7,103 3,179 1,780,719 1,213 271 Jun 14
80 AVI 11,244 6,846 30,195,831 3,560 1,349 Jun 15 99 Growthpoint Properties 7,870 103,823 69,715,594 63,793 5,364 Jun 15
80 10,267 5,910 28,620,146 3,873 1,302 Jun 14 98 6,605 81,986 68,920,434 49,428 3,476 Jun 14
81 Intu Properties Plc 11,156 231,133 89,151,079 110,612 4,877 Dec 15 100 Metair Investments 7,732 7,654 3,939,920 5,135 575 Dec 15
85 9,580 172,515 82,407,725 79,493 491 Dec 14 93 7,279 6,624 6,683,935 4,339 617 Dec 14
82 Sun International 11,044 13,292 7,494,276 2,214 702 Jun 15 101 Cashbuild 7,693 3,023 8,096,698 1,251 369 Jun 15
74 10,825 13,059 14,380,311 1,564 536 Jun 14 96 6,781 2,574 5,894,415 1,160 288 Jun 14
83 PSG Group 10,981 57,440 46,271,099 24,866 1,690 Feb 15 102 Choppies Enterprises 7,483 2,636 6,858,546 1,957 247 Jun 15
92 7,569 34,155 36,459,406 9,744 1,167 Feb 14
84 Combined Motor Holdings 10,772 2,597 1,155,690 528 180 Feb 15 103 Raubex Group 7,245 5,421 3,470,845 3,636 384 Feb 15
77 10,753 2,452 1,275,833 472 167 Feb 14 101 6,325 4,546 3,390,675 3,363 342 Feb 14
85 Stefanutti Stocks Holdings 10,643 5,227 733,514 2,437 163 Feb 15 104 Basil Real Holdings 6,585 3,862 347,672 877 -571 Dec 14
86 9,424 5,002 993,066 2,263 105 Feb 14 100 6,495 4,148 1,178,663 1,836 62 Dec 13
86 Invicta Holdings 10,460 13,268 5,673,189 3,458 550 Mar 15 105 Redefine Properties 6,305 64,805 58,108,855 43,596 3,533 Aug 15
78 10,465 12,390 7,892,992 1,972 593 Mar 14 107 5,372 52,188 46,680,337 31,932 2,017 Aug 14
87 EOH Holdings 9,702 5,228 20,192,823 3,677 784 Jul 15 106 Caxton Ctp Publishers & Printers 6,261 6,688 5,969,418 5,267 456 Jun 15
94 7,199 3,447 20,825,314 2,073 597 Jul 14 106 5,390 6,301 6,694,951 5,004 304 Jun 14
88 MPACT 9,548 6,983 8,596,656 3,724 666 Dec 15 107 Oceana Group 6,169 5,977 16,940,769 3,486 598 Sep 15
89 8,617 5,965 7,056,334 3,179 454 Dec 14 110 5,039 2,836 12,024,331 1,439 626 Sep 14
89 Eqstra Holdings 9,463 13,563 628,529 4,423 343 Jun 15 108 Northam Platinum 6,036 18,958 21,446,495 22,255 314 Jun 15
83 9,978 13,623 1,851,155 4,111 276 Jun 14 108 5,339 14,637 18,332,694 23,725 -95 Jun 14
90 Clover Industries 9,266 4,875 3,271,847 2,664 325 Jun 15 109 Bell Equipment 5,901 4,516 1,194,093 2,954 241 Dec 15
90 8,530 4,147 3,403,565 2,393 210 Jun 14 97 6,609 4,191 837,292 2,455 87 Dec 14
91 African Rainbow Minerals 9,263 34,566 20,715,124 33,338 68 Jun 15 110 Comair 5,891 3,996 1,454,925 1,331 371 Jun 15
82 10,004 35,906 21,500,319 33,856 3,951 Jun 14 103 6,282 3,989 2,421,447 1,179 274 Jun 14
92 PPC 9,227 14,454 7,385,631 3,759 876 Sep 15 111 African Oxygen 5,834 5,825 4,662,799 3,516 317 Dec 14
88 9,039 10,932 11,096,608 2,779 1,021 Sep 14 105 5,825 5,899 6,788,487 3,701 241 Dec 13
93 Zeder Investments 8,692 15,503 9,137,117 12,118 230 Feb 15 112 Adcock Ingram Holdings 5,528 4,703 7,731,156 2,909 438 Jun 15
104 6,011 7,042 12,041,658 4,300 319 Feb 14 111 4,820 4,562 9,138,550 2,752 -222 Jun 14
94 Reunert 8,541 8,556 12,740,176 6,187 905 Sep 15 113 Mustek 5,310 3,364 628,399 932 145 Jun 15
73 10,838 8,788 10,983,227 6,138 657 Sep 14 113 4,764 2,612 999,329 857 124 Jun 14

24 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 25
Financial Mail Page 26-27 -29/08/16 02:29:01 PM

NO. 118 FAMOUS NO. 142 JSE


BRANDS Gaining from a volatile time
Growth organic and by
acquisition

SA GIANTS SA GIANTS
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end turnover Rm Rm Rm Rm Rm year-end

114 Distribution & Warehousing Network 5,268 3,477 968,971 1,917 -99 Mar 15
109 5,192 3,225 1,574,578 1,432 100 Jun 14 133 Pan African Resouces Plc 2,753 6,873 5,347,964 4,295 154 Jun 15

115 Hudaco Industries 5,230 2,669 3,688,581 1,719 395 Nov 15 123 2,760 5,918 3,754,564 3,609 445 Jun 14

114 4,480 2,295 3,876,425 1,550 42 Nov 14 134 Deneb Investments 2,675 2,858 1,100,519 1,723 52 Mar 15

116 Coronation Fund Managers 4,442 68,754 25,675,254 1,158 1,834 Sep 15
112 4,774 75,607 34,367,761 1,064 1,952 Sep 14 135 Elb Group 2,544 1,812 591,104 776 115 Jun 15

117 Merafe Resources 4,428 5,785 1,908,135 7,369 396 Dec 15 130 2,349 1,900 1,468,805 710 98 Jun 14

118 3,609 5,388 1,983,456 7,015 267 Dec 14 136 Assore 2,526 19,482 22,476,727 17,528 1,531 Jun 15

118 Lewis Group 4,377 8,346 4,608,724 5,804 815 Mar 15 146 1,769 18,931 18,567,731 16,728 4,050 Jun 14

115 4,073 7,989 7,589,686 5,246 794 Mar 14 137 Astrapak 2,508 1,928 499,985 961 -125 Feb 15

119 E-Media Holdings 4,355 2,342 606,197 6,499 307 Mar 15 126 2,620 2,129 567,551 1,159 -88 Feb 14

116 3,992 4,400 925,247 3,118 19 Mar 14 138 Datacentrix Holdings 2,248 849 975,011 561 108 Feb 15

120 Novus Holding 4,261 3,359 3,994,323 2,596 440 Mar 15 133 2,276 833 677,376 494 96 Feb 14
139 Capital & Counties Properties Plc 2,243 94,621 58,939,840 67,112 -9,319 Dec 15

121 Consolidated Infrastructure Group 3,604 4,604 4,502,703 2,700 321 Aug 15 139 1,975 55,541 60,791,374 45,318 -163 Dec 14

125 2,636 3,451 3,869,281 2,209 251 Aug 14 140 Nu-World Holdings 2,159 1,159 543,288 805 79 Aug 15

122 Quantum Foods Holdings 3,468 2,067 676,420 1,703 152 Sep 15 136 2,108 975 588,808 723 70 Aug 14

119 3,561 2,036 909,669 1,648 26 Sep 14 141 ARB Holdings 2,151 1,188 1,222,000 800 129 Jun 15

123 Santova 3,463 604 642,997 213 31 Feb 15 135 2,217 1,136 1,433,500 686 112 Jun 14

121 3,222 566 484,430 185 26 Feb 14 142 JSE 2,134 38,152 12,944,762 2,368 861 Dec 15

124 Famous Brands 3,283 901 11,668,073 1,238 482 Feb 15 145 1,779 28,868 10,698,107 2,008 636 Dec 14

122 2,826 805 11,178,992 1,097 399 Feb 14 143 New Europe Property Investments Plc 2,108 37,162 56,855,772 25,762 1,289 Dec 15

125 BSI Steel 3,279 1,700 259,147 668 27 Mar 15 164 1,253 21,371 39,129,843 17,587 1,045 Dec 14

120 3,347 1,651 424,714 618 62 Mar 14 144 DRDGOLD 2,105 4,196 2,568,067 2,127 32 Jun 15

126 Marshall Monteagle Plc 3,131 2,008 627,506 932 31 Sep 15 144 1,809 4,190 817,013 1,827 18 Jun 14

134 2,246 1,567 505,232 790 26 Sep 14 145 Arocentric Investment Corporation 2,098 745 2,777,430 1,017 238 Jun 15

127 Italtile 3,115 3,074 12,399,993 2,549 687 Jun 15 141 1,958 872 2,947,487 944 224 Jun 14

124 2,714 2,687 11,624,994 2,081 504 Jun 14 146 Atlatsa Resources Corporation 2,052 932 360,287 1,154 2,627 Dec 15

128 Royal Bafokeng Platinum 3,045 18,861 7,415,845 29,288 -2,426 Dec 15 131 2,331 7,090 1,108,576 9,283 -303 Dec 14

117 3,768 21,201 10,005,374 34,590 601 Dec 14 147 Value Group 2,038 1,468 579,789 878 85 Feb 15

129 Rhodes Food Group Holdings 3,023 2,126 4,674,150 1,065 191 Sep 15 138 1,975 1,463 769,669 856 141 Feb 14

129 2,444 1,504 4,771,390 304 80 Sep 14 148 Afrimat 1,986 1,383 3,295,035 1,015 187 Feb 15

130 Tharisa Plc 2,965 4,123 1,740,064 5,733 67 Sep 15 142 1,893 1,313 2,464,113 925 155 Feb 14

127 2,546 3,837 1,528,683 5,249 -26 Sep 14 149 Peregrine Holdings 1,981 29,672 6,160,290 2,277 557 Mar 15

131 Ascendis Health 2,817 1,572 6,227,742 1,909 234 Jun 15 148 1,756 20,796 5,806,651 1,790 422 Mar 14

152 1,634 1,255 4,075,942 1,230 153 Jun 14 150 AdvTech 1,932 1,765 3,770,477 855 183 Dec 14

132 Hyprop Investments 2,753 28,856 28,623,944 21,031 1,382 Jun 15 147 1,766 1,446 3,201,746 775 173 Dec 13

128 2,515 26,861 28,704,218 12,818 253 Jun 14

26 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 27
Financial Mail Page 28-29 -29/08/16 02:29:28 PM

NO. 166 ESOR NO. 176 CITY LODGE


Surviving in lean sector Tried and tested business
conditions model

SA GIANTS SA GIANTS
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end turnover Rm Rm Rm Rm Rm year-end

151 Alexander Forbes Group Holdings 1,909 269,242 8,987,560 5,391 342 Mar 15 170 Mix Telematics 1,389 1,423 1,885,964 1,905 166 Mar 15
163 1,272 1,262 2,608,435 1,672 168 Mar 14
152 Brimstone Investment Corporation 1,900 7,520 555,848 2,886 -571 Dec 15 171 Onelogix Group 1,388 1,315 956,746 796 10 May 15
140 1,968 7,806 733,292 3,842 288 Dec 14 178 1,034 846 1,404,329 416 80 May 14
153 Resilient REIT 1,877 35,575 52,243,004 27,408 5,335 Jun 15 172 Sentula Mining 1,375 1,357 186,810 960 -152 Mar 15
161 1,301 24,515 35,589,753 16,112 1,732 Jun 14 154 1,593 1,709 99,715 1,352 -530 Mar 14
154 Ellies Holdings 1,803 1,451 483,723 814 -353 Apr 15 173 Transpaco 1,356 724 799,619 453 81 Jun 15
137 2,106 1,812 521,016 1,049 89 Apr 14 165 1,247 648 633,032 404 70 Jun 14
155 Argent Industrial 1,791 1,500 421,894 1,189 42 Mar 15 174 Torre Industries 1,332 1,236 1,605,548 1,324 82 Jun 15
143 1,880 1,558 420,699 1,183 18 Mar 14 223 430 669 1,682,289 490 36 Jun 14
156 Workforce Holdings 1,759 463 384,000 243 55 Dec 14 175 Attacq 1,313 22,868 14,582,544 13,303 326 Jun 15
153 1,619 444 108,000 192 3 Dec 13 170 1,140 18,105 19,425,517 10,801 185 Jun 14
157 South Ocean Holdings 1,715 988 157,942 615 37 Dec 14 176 City Lodge Hotels 1,303 1,961 6,377,029 751 275 Jun 15
149 1,691 937 156,378 578 35 Dec 13 175 1,063 1,685 5,954,230 572 238 Jun 14
158 Vukile Property Fund 1,676 14,470 11,010,343 9,828 1,022 Mar 15 177 CSG Holdings 1,287 332 606,567 281 72 Mar 15
155 1,443 11,376 11,025,394 3,113 82 Mar 14 181 978 281 834,019 219 35 Mar 14
159 Wescoal Holdings 1,674 701 363,426 404 10 Mar 15 178 Petmin 1,274 2,191 646,137 2,026 135 Jun 15
169 1,147 612 386,713 431 -69 Mar 14 179 1,020 2,035 778,826 1,974 139 Jun 14
160 Sovereign Food Investments 1,649 1,207 506,878 864 99 Feb 15 179 Phumelela Gaming & Leisure 1,264 707 1,480,356 402 90 Jul 15
158 1,391 1,074 629,595 786 58 Feb 14 184 927 720 1,272,181 429 91 Jul 14
161 Clientele 1,641 2,692 4,801,029 444 369 Jun 15 180 Redefine International Plc 1,250 24,991 17,696,874 11,746 181 Aug 15
157 1,406 2,597 5,941,232 376 324 Jun 14 168 1,148 20,912 15,224,377 8,135 262 Aug 14
162 Octodec Investments 1,639 11,803 6,242,440 6,828 545 Aug 15 181 WINHOLD 1,222 556 132,525 272 26 Sep 15
214 538 4,656 6,382,892 2,897 253 Aug 14 174 1,099 570 63,107 257 14 Sep 14
163 Hoowden Africa Holdings 1,588 1,353 2,721,185 794 276 Dec 14 182 Homechoice Investments 1,213 2,052 3,308,205 1,488 403 Dec 14
150 1,682 1,225 2,892,738 530 319 Dec 13
164 Holdsport 1,545 643 2,631,731 899 187 Feb 15 183 Nivectus 1,205 2,697 2,740,742 1,385 73 Mar 15
156 1,418 588 2,106,162 881 178 Feb 14 166 1,155 2,588 2,805,792 1,231 120 Mar 14
165 York Timber Holdings 1,543 3,496 745,291 3,019 125 Jun 15 184 SA Corporate Real Estate Fund 1,199 14,058 11,047,676 9,523 857 Dec 15
160 1,324 3,143 745,291 2,893 67 Jun 14 177 1,034 11,268 9,918,395 7,603 652 Dec 14
166 Esor 1,448 1,061 90,892 677 21 Feb 15 185 Transaction Capital 1,195 9,206 6,722,393 2,375 431 Sep 15
132 2,317 1,339 75,085 787 -153 Feb 14 171 1,133 9,384 5,126,663 2,999 317 Sep 14
167 Keaton Energy Holdings 1,448 1,877 163,516 2,234 89 Mar 15 186 Wilderness Holdings 1,153 1,085 1,391,294 541 111 Feb 15
159 1,373 1,154 448,885 1,518 103 Mar 14 151 1,678 967 1,275,353 437 65 Feb 14
168 Master Drilling Group 1,432 1,918 2,140,953 1,209 237 Dec 14 187 Andulela Investment Holdings 1,145 565 30,675 400 -21 Dec 15
167 1,155 1,663 1,705,053 1,006 175 Dec 13 173 1,113 566 196,324 394 -28 Dec 14
169 Emira Property Fund 1,416 13,841 7,734,833 8,590 934 Jun 15 188 Rolfes Holdings 1,132 661 438,864 334 46 Jun 15
172 1,116 11,639 9,164,374 7,005 N/A Jun 14 180 1,001 573 346,464 302 34 Jun 14

28 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 29
Financial Mail Page 30-31 -29/08/16 02:30:32 PM

✥ CHEMICALS ✥

NO. 194 CURRO


Spectacular growth just goes
on

Caution amid

SECTORS
SA GIANTS

commodities
Ranked by Company Turnover Total assets Market cap Equity funds Net profit Financial
turnover Rm Rm Rm Rm Rm year-end

189 Jasco Electronics Holdings 1,117 630 162,816 175 19 Jun 15


176 1,035 604 131,039 263 8 Jun 14
190
162
191
195
Buildmax

Micromega Holdings
1,079
1,274
1,036
726
994
1,250
503
341
32,634
110,593
1,149,150
2,125,929
455
767
576
433
-231
64
120
97
Feb 15
Feb 14
Mar 15
Mar 14
uncertainty
192 Rebosis Property Fund 1,011 14,911 5,596,229 5,861 105 Aug 15
189 808 7,607 5,597,180 1,833 2 Aug 14
Strategic Fuel Fund may scupper Sasol dreams of buying
193 Delta Property Fund 1,009 10,879 3,555,759 4,621 416 Feb 15 Caltex’s 845 service stations and an oil refinery
204 654 7,534 4,171,172 3,258 60 Feb 14
194 Curro Holdings 1,001 3,612 11,233,078 2,377 83 Dec 14

T
203 659 2,263 7,917,351 1,679 53 Dec 13
he chemicals sector of the JSE is small in reference to the R7.4bn writedown.
195 MTN Zakhele (RF) 970 9,314 5,379,874 6,114 711 Dec 15
and the petrochemical powerhouse that Long-term, Montney is a “great asset,” he said.
is Sasol usually dominates the headlines Meanwhile as both oil and gas prices are in the
196 Insimbi Refractory & Alloy Supplies 958 326 332,800 128 26 Feb 15 of financial reporting. The duds that are process of recovering, the company expects the
Spanjaard and Delta aside, the other cost of its Lake Charles project in Louisiana to
183 939 331 169,000 118 16 Feb 14
companies included in calculating the index are increase to $11bn, “mostly due to construction
197 Conduit Capital 946 1,034 828,449 475 42 Jun 15 AECI, Afrox, Omnia and Rolfes.

Martin Rhodes
186 883 972 576,854 436 135 Aug 14 But despite size or stature, just like all other
commodity-driven companies, the slump in
198 Trans Hex Group 940 1,019 376,482 805 103 Mar 15 international resource prices – due to global
197 696 951 335,122 808 -9 Mar 14 economic uncertainty and an ongoing oil-supply
glut — have put great strain on all of them.
199 Bowler Metcalf 933 765 1,001,005 701 83 Jun 15
Following very disappointing results for the
194 726 528 654,367 452 60 Jun 14 interim period to December, as crude and
200 Calgro M3 Holdings 932 1,276 2,852,663 603 151 Feb 15 chemical prices continued to slide, Sasol
announced in May that it expects earnings to be
190 785 1,046 1,634,506 452 112 Feb 14
even worse with a possible dive of between
Source: McGregor BFA 10%-30%, adding that energy-market and
exchange-rate volatility may further affect
results.
This despite implementing rigorous cost
savings initiatives, which included cutting jobs
and shelving larger capital projects. The company
wants to save R75bn in expenses through 2018.
It seems that trimming some fat from
operations will not be enough to negate the
R11.5bn in impairments on the Montney shale
asset in Canada due to lower natural-gas prices,
which had fallen significantly during the period.
Similarly, a lower Brent crude oil price, to which
the producer’s revenue is linked, also played
havoc with the bottom line.
“We’re being very conservative, so that allows Rod
us to protect the gearing, pay the dividend and Humphris
make sure the credit rating stays where it is,”
CEO David Constable told Bloomberg in March,

30 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 31
Financial Mail Page 32-33 -29/08/16 02:31:04 PM

✥ CHEMICALS ✥ ✥ MINING ✥

Fraught

Russell Roberts
delays … higher labour costs … lump-sum bid early to mid-2000s.

SECTORS
SECTORS

contract prices being higher than originally If the strategy is fully executed, Anglo will be
estimated, as well as quantities of bulk materials smaller (in terms of production volumes, revenue
being in excess of those included in the original and range of activities) than at almost any time in
estimate,” Sasol said in a statement earlier this
year.
The company has already invested $4.5bn in
times ... its hundred-year history — but investors seem to
like Cutifani’s approach. If other commodity
prices rise again beyond expectation, the strategy

desperate
the Lake Charles development, with more than can always be reviewed.
40% of the project completed. It expects the Politically, the shrinking of Anglo and its
ethane cracker to reach “beneficial operation” in departure to London have left the industry in SA
the second half of 2018. without a natural spokesman. The Chamber of
In the interim, the company has delayed a
decision on whether to build a gas-to-liquids
plant in the US, which would have cost as much
as $14bn.
David Constable
measures Mines does not have the same clout that Anglo
did in the days of Harry Oppenheimer. Cutifani
seemed to have a growing appetite for the role
when he was CEO of Anglogold Ashanti, but then
Closer to home however, Sasol announced at he left for the gold company’s former parent.
the beginning of July that it was considering The mining industry in SA has long
buying a majority stake in Chevron’s SA assets, “Core competence” focus complained about the lack of certainty in the
including a 110,000 barrels/day oil refinery and policy environment, and there are times when
retail stations. makes Anglo smaller than the ANC government appears to be targeting an
Chevron said in January it would sell its 75%
stake in its local business, following similar sales
countries.
Smaller player AECI is also trading under a
almost ever industry that no longer exists. It has railed, for
example, against retrenchment plans, without
in Nigeria due to weak oil prices. cautionary. The company has reported that it being able to offer any alternative to companies

T
The assets in question include its expects headline earnings per share to be up to struggling to keep their heads above water in an
110,000-barrel-a-day Cape Town refinery, 20% lower for the financial year to June. he extended slump in commodity prices era of steadily increasing costs and low demand
Durban lubricants plant and network of 845 Omnia investors’ fears also came to pass has caused many casualties. Mining for their products.
Caltex retail fuel stations. following the company’s expectation of lower companies have put expansion and new A mine is not a sustainable business, by
Sasol owns already owns some refineries and HEPS of between 28%-31% when results for the investment on hold, closed down some definition. It has a finite life. Unlike retailers or
service stations in the country. year to March were released at divisions and sold others. Jobs have been construction companies, that endure indefinitely
“It’s a strategic fit as Sasol CHEMICALS the end of June. The company lost. if managed properly, mining companies are
has been trying to develop its Chemicals index reported a slump of 29% to Perhaps the most significant change has been doomed from the moment they are created. The
retail footprint in SA to get a All share index 1033c/share for the year seen in the strategic shift by Anglo American. only variable is the length of their survival, and
114
higher margin for its fuel,” 111 compared with 1456c/share Founded in 1917 by Ernest Oppenheimer, Anglo that cannot be predicted.
Sanlam Private Wealth equity 108 last year. was by far the biggest company in SA in the last In SA, strikes often seem to be a first rather
analyst Shiraaz Abdullah was 105 But despite a challenging decades of the 20th century. Directly and than the last resort. Productivity remains low by
quoted by Reuters. 102 economic environment, indirectly, it controlled a major portion of the JSE global standards, and costs (especially electricity
He said that due to limited 99 worsened by negative weather as measured by market capitalisation. There were tariffs) continue to rise ahead of inflation.
retail outlets, Sasol has been 96 conditions, chemicals group few sectors of the economy in which it did not All of this is making SA steadily less attractive
forced to sell its fuel at a lower 93 Omnia managed to end the have some interest. as a destination for mining investment, which in
wholesale price to competitors 90 year with an ungeared balance With the opening up of international markets turn will shorten the lifespan of many mines –
rather than directly to 87 sheet. after the advent of democracy in 1994, Anglo was with gold most vulnerable, though the price has
consumers. It all comes down 84 CEO Rod Humphris told one of several SA corporates that moved its surged in 2016, but with platinum by no means
81
to a decent price, he told the J F M AM J J A S O N D J FMA M J J A
Business Day: “Our stringent prime listing to London. At the same time, it immune. Unionists’ purpose is supposed to be to
news agency. 2015 2016 capital management has decided to focus on its “core competence” — a protect their members’ interests, which they are
An offer, however, could pit Source: IRESS Share prices based to 100
ensured that we have ended very fashionable concept at the time — which it not doing in the mining sector in the long term,
it against an offer from the the year with an ungeared decided was commodities. It shed nearly all its because they are ignoring economic realities.
Strategic Fuel Fund, the government’s custodian balance sheet and an increase in cash generated.” other businesses, as well as its gold holding, David Williams
of strategic fuel stocks, which revealed that it had Orin Tambo, senior analyst at Intellidex, told Anglogold Ashanti.
offered to buy the assets. the newspaper that gearing was an important CEO Mark Cutifani was handed something TOP SIX MINING
Although many fundamentals indicate a indicator for most investors in companies that of a hospital pass when he took over from
Ranked by Name Net profit Rm Total assets Market cap Equity funds
turnaround for oil prices, management and were exposed to commodities. Cynthia Carroll in 2013. Anglo had taken on a
net profit Rm Rm Rm
analysts at PSG have indicated that investors “It tells you whether a company can survive … lot of debt and the expected revenue had not
should be cautious as the oil price is very before it has sucked investors completely dry. So materialised. He announced this year that the 1 BHP Billiton Plc 99,700 1,823,650 350,603,918 1,331,644
sensitive to market sentiment. having an ungeared balance sheet is a plus for core competence in commodities would now 2 Glencore Plc 50,591 1,853,256 481,928,050 1,013,758
Both also expect global economic Omnia. It means it can continue borrowing at be reduced to a smaller core of just three: 3 Kumba Irone Ore 11,364 50,028 50,245,411 29,139
environment to remain volatile and uncertain, favourable rates compared to its peers. And also it platinum, copper and diamonds. One of the 4 Anglo American Plc 7,589 739,806 162,359,644 433,759
5 Assore 1,531 19,482 22,476,727 17,528
predicting moderate global growth, mostly driven gives management room to continue with the major holdings scheduled for disposal is the
6 Exxaro Resources 1,099 58,687 35,990,608 49,502
by advanced economies which will offset acquisitive strategy,” Tambo said. majority share in iron ore company Kumba,
Source: McGregor BFA
negative growth from emerging and oil exporting Ruan Jooste which was a major money-spinner in the

32 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 33
Financial Mail Page 34-35 -29/08/16 02:31:45 PM

✥ GOLD ✥ ✥ PLATINUM ✥

Haven in leave the European Union, with this unexpected

New PGM sector and believe that these assets provide

SECTORS
SECTORS

result prompting a rush to the traditional refuge an attractively priced entry.”


when investors have been surprised and are It helped that Amplats had already carried out
worried about enduring uncertainty. painful restructuring, eliminating loss-making

the storm The metal dropped to US$1,255/oz in the


fortnight before the referendum, as the consensus
grew that the UK would vote to remain in the EU.
entrant production with the loss of 7,500 jobs, and that
the lower platinum price suggested there could
only be an improvement in a year or two when

again takes risks


It then soared more than 22% as it became clear global demand recovered.
that the “leave” vote would prevail, before falling In 2014 there had been some optimism that
back. the balance between supply and demand would
Another traditional reason for investment in adjust in 2015 to produce a higher platinum price,

Gold bucks the trend and


gold emerges when there is concern about global
inflation, but that is certainly not the case at the
moment. But safe haven it certainly was again
after the Brexit vote, as the FTSE lost £120bn of
and scores and therefore relief for an embattled sector
whose glory days of the mid-2000s (prices well
above $2,100/oz) seemed very far off — as did
2011, when the price touched $1904/oz.
shines thanks to Brexit and its value before recovering slightly and the pound By May 2015, the picture was different.
weaker rand hit 30-year lows against the US dollar.
How long will gold’s recent relative strength Sibanye Gold turned old
Analysts at Thomson Reuters suggested that
platinum prices could test $1,000 an ounce, a
last? Analysts have been moving away from the level not seen since early 2009.

G
expectation of a rise in US interest rates, which unwanted assets into big Autocatalyst scrap declined by 14% in 2015. On
old was the only commodity in
2015-2016 that performed well for
also supports a stronger gold price.
Investors who got into SA gold equities a year
revenue the demand side, platinum consumption in
autocatalysts rose by 2% last year to 3m oz.
investors, in the broader context of low ago have done very well, with Anglogold Ashanti Platinum used for making jewellery dropped by

A
demand for commodities and cutbacks improving 133% to R266/share, Gold Fields by 4% to 2.46m oz. Industrial
on exploration by the big companies. 70% to R68 and Sibanye a stunning 145% to R49. company that did PLATINUM & PRECIOUS METALS segments were also weaker,
At the end of June this year the gold price was Over three years the picture is less positive for not exist four years Platinum & precious metals index with the chemicals sector
US$1,319/oz, 8% higher than three months earlier those holding Anglogold Ashanti and Gold Fields. ago is now ranked in All share index down 17%, the petroleum
115
and 14% higher than a year ago. The real star has been Sibanye, whose share the top five platinum 110 industry retreating 18%, and
In late May 2015, gold was at $1,190 and the price three years ago, not long after the split from producers. 105 platinum demanded by
100
outlook seemed gloomy. The Financial Mail Gold Fields, was sitting at R7.80. At the end of Sibanye Gold, which was 90 electronics also dropping.
reminded readers that “it has June this year it was at R49. created from Gold Fields’ 85 Following the Rustenburg
been well known that the GOLD That partly reflects gold’s good unwanted SA assets and listed
80
75 disposal, says chairman Valli
operating environment for SA 70 Moosa, Amplats will focus on
R/kg US$/oz fortunes, and partly the in 2013, moved to acquire both
65
mining companies is very 640,000 market’s satisfaction with Aquarius and the Rustenburg 60 “governing and managing the
1,290 55
difficult, with weak pricing, 620,000 Gold price what CEO Neal Froneman has operations of Anglo American 50
business for the current
rising costs, volatile labour, 600,000 Gold spot 1,260 been doing. Platinum (Amplats). 45 difficult PGM pricing
40
limited electricity supply and 580,000 1,230 He announced his intention The Amplats deal was 35
environment by ensuring
regulatory uncertainty”. 560,000 1,200 to expand into platinum, at a launched on especially J F MAM J J A SO ND J F MAM J J A
disciplined capital spend;
None of that has changed, 540,000 1,170
time when that metal was favourable terms for Sibanye: 2015 2016 controlling costs; reducing
but on the other hand the 520,000 testing the US$800/oz mark. It an upfront consideration of Source: IRESS Share prices based to 100 overheads and indirect
1,140
weaker currency meant that 500,000 has since recovered, but R1.5bn in cash or shares, and a spending; and improving metal
480,000 1,110
the rand price of gold ran up remained below $1,000/oz, deferred consideration equal to 35% of the sales volumes”. For 2015 he reported a “free cash
unexpectedly, hitting a record 460,000 1,080 and if there was ever a time distributable free cashflows generated by the flow of R1.8bn (R4bn if the once-off tax payment
high of R20,000/oz in March. 440,000 1,050 for a gold miner to get into operations. If cashflows were negative, Amplats and restructuring costs are excluded) and
The gold price had a J FMAMJ J A SOND J FMAM J J A platinum, it was probably in would need to compensate Sibanye. reduced net debt from R14.6bn to R12.8bn by
2015 2016
particularly strong run in the Source: IRESS
early 2016. Froneman has also It was asked what Sibanye CEO Neal year end”.
aftermath of the British vote to increasingly been playing the Froneman could do with the Rustenburg David Williams
part of a mining statesman, operations that Amplats could — the answer
TOP SIX GOLD commenting on industry issues beyond his seemed to be “quite a lot”. Froneman had TOP SIX PLATINUM
Ranked by Name Net profit Rm Total assets Market cap Equity funds own company, and has proved himself adept established firm but empathetic labour Ranked by Name Net profit Rm Total assets Market cap Equity funds
net profit Rm Rm Rm at dealing with the unions. relations at Sibanye, something Amplats had net profit Rm Rm Rm
The hard statistics of gold production in battled with , following the debilitating
1 Sibanye Gold 1,289 49,598 51,918,789 20,784 SA remain sobering, though masked to some platinum strike in 2014. 1 Atlatsa Resources Corp 2,627 932 360287 1,154
2 Gold Filelds 933 1,300,390 39,927,710 47,969 extent by currency weakness. According to Froneman announced his intention to 2 Anglo American Platinum 2,437 73,960 97,592,480 67,693
3 Pan African Resources Plc 154 6,873 5,347,964 4,295 Stats SA, in calendar 2015 our output “fell to close loss-making and break-even 3 Northam Platinum 314 1 8 ,958 2 1 ,4 4 6 ,495 22 ,255
4 Randgold & Exploration 137 177 161,103 162 143,711/kg compared with 151,622/kg mined production, and promised better capital 4 Wesizwe Platinum 189 6,173 1,220,870 6,569
5 DRDGold 32 4,196 2,568,067 2,127 5 Bauba Platinum 189 6,173 1,220,870 6,569
the previous year. The seasonally adjusted allocation, rigid cost control and a
6 Central Rand Gold -110 279 204,874 -98 6 Jubilee Platinum -7 211 132,657 340
production index decreased by 5.4% in 2015. consolidation of ownership. “We have ...
Source: McGregor BFA Source: McGregor BFA
David Williams indicated our interest in participating in the

34 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 35
Financial Mail Page 36 -29/08/16 02:32:15 PM

✥ CONSTRUCTION & MATERIALS ✥

Building Murray & Roberts and Aveng found themselves


SECTORS

going backwards rapidly. As the larger


construction companies came back to SA, the
increased competition locally resulted in

blocks aid compressed profit margins.


Today, the shakeout is largely complete and
there are reasons to believe that a modest

growth in
recovery in certain construction activity may be
starting. But it is likely to be a long haul in this
notoriously cyclical industry. There is a logical
disconnect between what is claimed as

sector infrastructure spend in the public sector and


what is apparent in order books for construction
companies.
PPC has had a torrid time in the past couple of
years and now finds itself in the ignominious
position of being kept on life support by its
Early signs of long, slow banks. Strategically, one can hardly fault the logic
of expanding into the rest of Africa during the
recovery after industry past few years, as the SA cement market became
shakeout much more competitive with the arrival of new
players like Sephaku Cement. But it is the cost of
that expansion that has taken its toll on PPC.

T
At an operating profit level,
he construction CONSTRUCTION PPC still makes reasonable
sector has gone from Construction & materials index money but after paying the
hero to zero in a few All share index huge interest bill on its debt,
115
short years. At the 110 that situation evaporates. In
height of the 105 early August 2016, the
100
mini-boom in construction 95 company managed to
activity that accompanied the 90 persuade its shareholders to
preparations for the FIFA 85 approve a R4bn rights offer
80
World Cup in 2010 and the 75 that should ease its immediate
completion of the first stage of 70 liquidity problems.
Gautrain shortly thereafter, 65 WBHO has proved to be the
60
the construction sector 55 most consistent of all the larger
enjoyed outstanding success, 50 construction companies in
with companies reporting J F M AM J J A S O N D J F MAM J JA terms of coping with the
strong earnings growth. 2015 2016 cyclical nature of the industry.
Source: IRESS Share prices based to 100
But the combination of a But the remnants of the
profound slowdown in the SA Competition Commission
economy, problems for certain companies in investigation into collusive behaviour by the
collecting fees for work in the Middle East and construction companies has come back to haunt
Africa and a damaging Competition Commission WBHO recently, even though it was granted
investigation into collusion in the industry left immunity.
construction companies licking their wounds in a Murray & Roberts has been slowly improving
big way. Former darlings of the sector such as its financial situation under new management
but is still far from where it needs to be. Like
TOP SIX CONSTRUCTION competitors Aveng and WBHO, It is
Ranked by Name Net profit Rm Total assets Market cap Equity funds considering streamlining its operations via
net profit Rm Rm Rm the disposal of non-core assets.
Nimble, niche road construction and
1 PPC 876 14,454 7,385,631 3,759 rehabilitation operator Raubex has been one
2 Wilson Bayly Homes-Ovcon 614 13,358 7,519,617 4,056 of the few players in the construction sector
3 Murray & Roberts Holdings 424 17,300 5,603,675 5,834 to maintain consistently reasonable levels of
4 Raubex Group 384 5,421 3,470,845 3,636 profitability. Afrimat is one of a handful of
5 Afrimat 187 1,383 3,295,035 1,015
smaller construction firms that are bucking
6 Stefanutti Stocks Holdings 163 5,227 733,514 2,437
the overall dismal trend in the industry.
Source: McGregor BFA
Staff writer

36 FINANCIAL MAIL • TOP COMPANIES • 2016


Financial Mail Page 37 -29/08/16 10:40:27 AM

FŝŶĂŶĐŝĂů ĞůůŶĞ ĨŽ ĞŽ ůĞ͕ ĐŽŵŵŶŝĞ ĂŶĚ ď ŝŶĞ Ğ

MMI HŽůĚŝŶŐ ŚĂ Ă ŚŽ Ğ ŽĨ ĞůůͲĞĂďůŝŚĞĚ ĂŶĚ ĞĞĐĞĚ ďĂŶĚ ŽīĞŝŶŐ


ĐůŝĞŶͲĐĞŶŝĐ Žů ŽŶ ŚĂ ŶůŽĐŬ͕ ĚĞĞůŽ͕ ĞŶŚĂŶĐĞ ĂŶĚ ŽĞĐ ŚĞ ůŝĨĞŵĞ
ĮŶĂŶĐŝĂů ĞůůŶĞ ŽĨ ĞŽůĞ͕ ĐŽŵŵ ŶŝĞ ĂŶĚ ď ŝŶĞĞ͘

͘ŵŵŝŚŽůĚŝŶŐ ͘ĐŽŵ
Financial Mail Page 38-39 -29/08/16 02:32:44 PM

✥ TRANSPORT ✥ ✥ FOOD & BEVERAGES ✥

Still best performer, with both SA and international

Sweet in a fast-track listing and in late May, the South

SECTORS
SECTORS

logistics taking strain. African Competition Commission gave the deal


Regent is in the process of being disposed of conditional approval. Interestingly, one of the
and Associated Motor Holdings (AMH) is conditions was that the combined group would

moving currently being acquired.


Trencor was founded in Springbok,
Namaqualand in the Northern Cape in 1929 and
deals have three years in which to divest itself of
SABMiller’s 28% stake in local wines and spirits
producer and distributor Distell.

despite change the


has been listed on the JSE since 1955. Initially Though not yet included in the JSE All Share
known as Jowell’s Garage and Transport, Trencor Index, ABI is by far the largest share listed on the
started life as a General Motors dealership in the JSE, with a market capitalisation in excess of R3
midst of the Great Depression. Today, Trencor’s trillion, around twice the size of BAT, its nearest

bumps main asset is a 48.2% stake in Textainer, the


world’s largest container-leasing company,
measured by container fleet. The current
depressed global economy has taken its toll on
game competitor. SABMiller is arguably the greatest
company that ever listed on the JSE and has a
long and illustrious history going back to the days
when gold was discovered on the Witwatersrand.
Textainer’s earnings. In the short term, the Provided all the regulatory hurdles are passed,
outlook is not expect to change materially but in SABMiller will cease to exist in its own right later
Top firms sharpen focus and the longer term, management believes that any Major deals and acquisitions this year when it is absorbed into
short-term cyclicality should be more than Anheuser-Busch Inbev, creating a brewing
strategies to steer clear of ironed out. save the day for top brands behemoth that will produce more than 30% of all
trouble Supergroup has had a very chequered history
since its founding 20 years ago by Larry
in harsh economic climate the world’s beer.
Tiger Brands, which offers a broad spread of
Lipschitz. By the middle part of the last decade it consumer goods and competes with

T A
was teetering on the edge of failure, but action by multinational operators such
his sector is dominated by Imperial a new management team with the backing of its nheuser-Busch Inbev FOOD & BEVERAGES as Unilever and Nestle, has
Holdings, now headed by corporate major shareholders saved the day. Today, the (ABI) is the world’s Beverages index been severely criticised for its
170
entrepreneur and former Massmart CEO group is looking much better. In the six months largest brewer and is Food producers index Nigerian Dangote acquisition.
All share index 160
Mark Lamberti. He has built on the to end-December 2016, the company managed to about to get a lot 150
This transaction was
foundations laid by former CEO Hubert turn in a very respectable set of financials, bigger. In October disastrous for the group and
140
Brody and has taken this especially when viewed 2015 it successfully bid for billions had to be been written
TRANSPORT 130
quality company close to its against the sluggish SA SABMiller, the world’s off.
120
former status as a blue chip. Automobiles & parts index economy and the relatively second-largest brewer, in one Tiger has enough of a
Industrial transportation index 110
He is also strategic-minded weak rand. On a 40% rise in of the largest corporate deals diversified portfolio of
and his commitment to All share index 120 revenues, operating profit was in history at around $104bn. 100 products with strong brands,
115 90
“sharpen management focus” 110
23% up and headline earnings This deal was first mooted in and this may be enough to
should pay off handsomely. per share were 21% higher. Boston in 2010 and fast 80 carry the group through tough
105
Imperial has been 100 In its financial results became the world’s J F MAMJ J AS OND J F MAMJ J A local conditions as consumers
remarkably cash-generative 95 review for the year ended worst-kept corporate secret. 2015 2016 continue to come under
90 Source: IRESS Share prices based to 100
over the past decade, despite 85
February 29 2016, Value Group Both ABI and SABMiller had pressure.
having made significant 80 stated that “over the last year, grown mainly by acquisition Wine, spirits and flavoured
acquisitions during that time. 75 volumes in the logistics in the previous 20 years but had largely avoided alcoholic beverages maker Distell is busy
Segmentally, the Logistics 70 industry have declined to such coming into direct contact with each other innovating its strongly performing cider portfolio
65
division is the largest 60
an extent that the sector can geographically, other than in the US, China and and its Fourth Street range is proving popular.
contributor to operating profit be classified as being in a parts of western Europe. Little wonder, therefore, Distell is looking to invest more in gearing up and
J F MAM J J A S ON D J F MAM J JA
and it performed largely in 2015 2016 recession”. that there is relatively little geographical overlap aggressively expanding this brand. With a wide
line with expectations. Source: IRESS Share prices based to 100 Against such a background, in the deal and hence relatively few regulatory network of farmers and producer cellars, the
Geographically, Africa was the the company did well to limit hurdles to surmount. company is not overly concerned about how the
its earnings per share decline to 16%. The group has already moved rapidly to
TOP SIX TRANSPORT Long-established transport and logistics consummate the deal and has cleared most of TOP SIX FOOD & BEVERAGES
Ranked by Name Net profit Rm Total assets Market cap Equity funds company Cargo Carriers saw revenue from the few regulatory hurdles that existed. Miller Ranked by Name Net profit Rm Total assets Market cap Equity funds
net profit Rm Rm Rm continuing operations decline by 5.5% and Brewing in the US has been sold off to Coors, net profit Rm Rm Rm
headline earnings per share fall by 33.9% in and Snow in China has been sold to China
1 Imperial Holdings 3,449 57,466 30,498,454 18,559 the year ended February 29 2016. Resources Enterprise. Grolsch and Peroni, 1 Anheuser-Busch 115,694 591,916 296,095,457 773,379
2 Trencor 1,004 53,617 10,889,682 9,134 Niche logistics provider Onelogix has had a two of SABMiller’s iconic European brands, 2 SABMiller 41,839 317,226 1,505,781,568 330,394
3 Super Group 749 12,253 15,670,488 4,910 loyal following among small market have been sold to Asahi of Japan. The 3 Tiger Brands 3, 679 23,962 62 ,466,883 16,412
4 Value Group 85 1,468 579,789 878 capitalisation analysts ever since it was listed proceeds from these disposals have reduced 4 Distell Group 1,414 15,806 34,871,168 9,647
5 Cargo Carriers 45 847 280,000 522 5 AVI 1,349 6,846 30,195,831 3,560
on the AltX market in 2004. It transferred its the net consideration paid by ABI for
6 Onelogix Group 10 1,315 956,746 796 6 Pioneer Food Group 1,346 11,469 32,295,294 6,991
listing to the main board of the JSE in 2013. SABMiller quite considerably.
Source: McGregor BFA Source: McGregor BFA
Staff writer In January 2016, the group listed on the JSE

38 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 39
Financial Mail Page 40-41 -29/08/16 02:33:12 PM

✥ FOOD & BEVERAGES ✥ ✥ HOUSEHOLD GOODS ✥

drought could impact grape and wine supplies. Pioneer Food Group is doing all it can to not

Tobacco cheap stock, the share has always been a good

SECTORS
SECTORS

Oil-dependent countries in sub-Saharan pass on all of the cost-push price increases in the rand hedge for the SA investor. There have been
Africa — Angola and Nigeria — are taking some food sector to the hard-pressed consumer, while problems in Hong Kong and Macau as
strain, with volumes being notably down, but clinging on to its margins. But this is a difficult government there takes a stand against
other Africa markets are growing strongly,
especially Zambia, Mozambique and East Africa.
AVI is well diversified and has a rounded
ask, as a large portion of its cost base is in hard
currency, with drought conditions adding to the
challenge. Tongaat-Hulett’s sugar business is
firms: not corruption, so sales of luxury products used as
bribes have come off in this clampdown.
Latest results show that sales growth in

going up
portfolio of brands across the consumer struggling, with notable milling capacity lying mainland China is strong, as government is
spectrum and at various price points. Analysts idle, but its glucose, starch and land development focused on making sure the Chinese consumer
are approving that it has stayed away from the divisions are saving the group. holds up; and Japan is surging because of the
very low end of the value chain and does not RCL Foods — previously Rainbow Chickens — weaker yen. Profit margins in the watch division
offer staple products such as maize, wheat and
bread.
At the very top end of its ranges, rand
weakness will ultimately have to be passed on to
is under the guidance of large shareholder
Remgro. The group has been finding its feet over
the past few years and the mixture of assets at
this stage in the economic cycle is not a positive
in smoke are under strain as selling prices have come off in
an effort to get stock off the shelves. There is a
possible threat to this segment from the high
technology/sports/smart watches from
the SA consumer, especially those who have a one. Illovo is moving away from being an companies such as Apple and Samsung, but it’s
penchant for imported shoe and clothing labels exporter of bulk raw sugar into the EU, to being a also likely that consumers in this spending
in its Spitz and Kurt Geiger brands. It has done placer of sugar in domestic and regional markets Acquisitions, market share bracket will own both.
well to protect its brands in the middle market of and taking branded positions, and ABF’s Falling commodity prices have helped
food and beverages. Its I & J fishing business considerable experience will assist with this new prove industry is here to reduced input costs in some of its lines. The
tends to be the weak point from time to time as
this industry is extremely cyclical.
strategy.
Staff writer
stay despite bad press group has steadily been moving from a wholesale
to a retail model, which requires capital
investment, but where there is higher margin.

P
The company is sitting on a
Travel & Leisure is now coming right. It is seeing improved erhaps somewhat STEINHOFF pile of cash and conservative
logistics in Africa which is good for its ironically, BAT and 160
management will be looking
Tenacious efforts pay off operations across the continent. With the cigarette stocks Steinhoff
All share index
155
150
to do some accretive deals. A
drought pushing up SA meat prices, the group generally are bit out of favour at the
for some is trying its best to maintain a good value perceived as 145
140
moment, the company
proposition for families wanting to eat out. defensive stocks. The irony 135 remains a quality and popular
Famous Brands continues to be as acquisitive A weak rand has unfortunately wiped out the arises out of the realisation 130 stock.
125
as ever, thanks to its strong balance sheet and benefits of a low oil price for airline Comair, that tobacco smoking is an Recently listed on the
120
cash generation, constantly adding brands, even which is highly envious of how its European anti-social and deadly pursuit; 115 Frankfurt stock exchange,
very small ones, to its portfolio. counterparts are making super-profits from fuel and yet in certain parts of the 110 Steinhoff is an international
105
Home meal replacement/fast service dining prices coming down. It never saw any rand world, it still manages to grow. furniture and household goods
100
is a growing phenomenon around the world, benefit beyond $80/barrel because of negative An out-and-out rand hedge 95 retail chain.
especially for double-income families, and SA is currency impact. with a nice dividend yield, J F MAMJ J A S OND J F M AM J J A A few years ago the stock
playing catchup in this regard. Famous Brands is While managing the cyclicality and BAT has countered restrictive 2015 2016 was lowly rated as investors
Source: IRESS Share prices based to 100
keen on earning more offshore hard currency, sometimes irrationality of ticket pricing, the regulation by successfully were concerned about the
especially in the UK where it has Wimpy. operator has been constantly upgrading its fleet upselling smokers to its extent of goodwill on the
However, this space is very popular with the and focusing on the fundamentals of running an premium brands such as Dunhill, Kent, Lucky balance sheet and levels of debt used in
private equity players, and potential UK airline. Top of Comair’s wish list is a rapid Strike and Pall Mall. acquisitions.
acquisitions which have been considered have correction of South Africa’s visa regime so that The group focuses on cost containment and The company has not shied away from debt
been priced at exceptionally high multiples and the tourist numbers that the country deserves, growing market share, while assisting and has never apologised for being highly geared.
Famous Brands will not pay over the top for especially with the weak rand, can come governments clamp down on illegal cigarette But with a track record of being able to draw
assets. At home, with rising interest rates, flooding in. Comair is ultimately targeting a trade. Through corporate action it increased its phenomenal value out of their acquisitions, the
compounded by drought conditions, pushing up position where two-thirds of profits come from exposure to the US by acquiring a stake in market is now giving credit to management
raw material prices and indebted consumers, the airline and one third from ancillary services Reynolds America, which is unusual as efforts.
the group is seeing some margin erosion as it such as airport lounges. developed countries are seeing declining Staff writer
tries to preserve the margins of its franchisees Taste Holdings has effectively “bet the farm” smoking numbers. But the group remains
and still offer a competitive value proposition to on its recently acquired Starbucks coffee intent on growing market share in developing TOP FOUR PERSONAL & HOUSEHOLD
the end consumer. franchise being able to grow rapidly in the economies where smoking numbers are Ranked by Name Net profit Rm Total assets Market cap Equity funds
Spur Corporation has had difficulties with its South African market. CEO Carlo Gonzaga will increasing. net profit Rm Rm Rm
international portfolio, especially in the UK and need all of his operational skills to ensure his Swiss-based luxury goods company
Australia, but has made progress with cleaning shareholder base remains largely intact while Richemont is controlled by the Rupert family, 1 British American Tobacco 81,426 930,377 1,744,280,965 531,797
this up. UK operations have now stopped Starbucks and the recently-acquired Domino’s with some analysts commenting that it has 2 Richemont 27,397 293,087 508,897,800 200,733
bleeding, and loss-makers are being closed pizza chain are successfully bedded down. recently evolved from a growth stock to a 3 Steinhoff International Hldg 8,527 177,986 375,142,733 181,916
down. After years of tenacious effort, Australia Staff writer defensive stock, thanks to its stable of brands 4 Nu-World Holdings 79 1,159 543,288 805
Source: McGregor BFA
aimed at the international consumer. Never a

40 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 41
Financial Mail Page 42-43 -29/08/16 02:33:39 PM

✥ HEALTH & PHARMACEUTICALS ✥ ✥ HEALTH & PHARMACEUTICALS ✥

One big The pharmaceutical giant’s subsidiary, Aspen depreciation in Russia. saving include lowering the cost of goods for

SECTORS
SECTORS

Global Incorporated (AGI), will acquire exclusive The rest of the world reported a 4% increase anticoagulants, improving margins in infant
rights to sell AstraZeneca's seven established in revenue despite disinvestments and the nutritionals, adding new manufacturing capacity,

player in
medicines outside the US — Diprivan for general termination of licences and contracts in the Asia leveraging acquired intellectual property and
anaesthesia, EMLA, a topical anaesthetic, and five Pacific region with good growth in the Middle growing the third party API business.
local anaesthetics — Marcaine, Carbocaine and East and North Africa. In line with this strategy, opportunities have
Citanest. Ironically enough the dwindling value of the also been identified to establish a business that

SA &
These products are also sold in more than 100 rand supported a strong revenue growth from the will supply API and FDF products to the US.
countries, including China, Japan, Australia and export of finished dose form (FDF) products and A large portion of the targeted synergies is
Brazil. The portfolio generated sales of $592m last active pharmaceutical ingredients (API). SA’s expected to be realised in the 2017 financial year.
year. In a press release Pascal Soriot, CEO of contribution to revenue, however, still declined Analysts at PSG Wealth consider Aspen a good

Africa AstraZeneca, stated that the company had a rich


heritage in anesthetic medicines and the
agreement will extend the reach of its established
portfolio to a greater number of patients through
by 3% to R4.2bn, mainly driven by
disinvestments.
The group has admitted that profit arising
from the divestments, the currency devaluation
company with an impressive track record
supported by strong operating margins and a
consistently high return on equity.
“The margins should continue to improve as
AGI’s extensive commercial network. losses and the hyperinflationary adjustments the company beds down its recent acquisitions
“This agreement supports our strategic focus relating to Venezuela have significantly affected and delivers on its synergy targets,” it stated in a
Aspen’s growth is a tonic on the new medicines in three main therapy the comparability of the results with those of the report analysing the company results.
areas,” he said. Furthermore, CEO of Aspen prior period. The defensive nature of the group’s products,
that leaves it with a cash Stephen Saad was quoted saying that the deal Management said that the disinvestments in and its diverse income base, should negate the
headache was a strategically important investment for AGI.
“This transaction is an excellent opportunity
SA and Australasia were undertaken to reduce
complexity and increase focus, although
challenging global conditions to a certain extent.”
Investment analysts at PSG Wealth caution
to build on the quality brands commercialised management has stated that the financial investors, stating that factors outside

A
through AGI, working alongside an benefits will not be realised immediately. management’s control, such as regulation and
s the US$160bn Pfizer/Allergan acknowledged pioneer and leader in the field of Said Saad: “Performance was led by the currency volatility, will continue to affect
megamerger announcement has sent anesthetics,” he stated. International business where the Europe CIS performance.
the investment community into a Aspen’s international ambition has, however, region made a strong contribution. The “The weaker rand does present a decent
frenzy abroad, the SA sector has shrunk not been kind to their cash position. Their results nutritional products in South Africa and in Asia opportunity for API and FDF exports, offsetting
to a relevant player of one — Aspen for the six months to December, which were Pacific also achieved good growth. “The some of the cost-pressures experiences in other
Pharmacare. released in March, revealed that the cash portion completion of the divestments marks an product categories,” they say.
At the rate the drug maker is gaining traction was poor for the year arising from higher important step in achieving increased focus in “Trading on a historic p:e ratio of 25.1 times
locally and offshore, it could soon compete with inventory levels, currency translations and the SA and Asia Pacific businesses.” and 3.3 times its net asset value, we feel the share
some of the bigger acquisitions. He added: “Further meaningful advances in is fairly valued given its growth and would advise
international players. HEALTH Management highlighted the implementation of Aspen’s strategic investors to hold their shares.”
Aspen is already a supplier Health care equipment & services index that better inventory objectives have been made and we are seeking to As of July 1, as reported by the Financial Times
of branded and generic Pharmaceuticals & biotechnology index management would be a key grow the business in targeted therapeutic (FT), the consensus forecast amongst 12 polled
All share index
pharmaceuticals in 115
focus in future. categories. We remain alert to opportunities to investment analysts covering Aspen Pharmacare
approximately 100 countries 110
From an income expand our product portfolio in these areas of advises that the company will outperform the
across the globe and of 105 perspective international focus.” market.
consumer and nutritional 100 operations, which contributed Management expects the full year’s cash flow This has been the consensus forecast since the
products in selected territories. 95 48% to revenue and 59% to to remain under pressure from the higher sentiment of investment analysts improved on
The group is also a leading 90 earnings before interest, tax inventory levels, but a reversion is anticipated in Jan 29, FT market data reveals, and the previous
generics manufacturer in the 85 and amortisation (Ebitda), the following year. consensus forecast advised investors to hold their
southern hemisphere and is 80 revenue only rose by 2% to The core currency exposures on earnings position in Aspen. Morningstar stock analysis has
also one of the leading global 75 R9bn due to the hyper- before interest tax and amortisation (Ebita) level the stock trading on a forward p:e of 5.9 and
players in generic 70 inflationary environment in are the Australian dollar, the rand and the euro. estimates earnings to increase by 3.8% next year.
antiretrovirals (ARVs). 65 Venezuela. Excluding this, The company has less Ebita exposure to the Ruan Jooste
Back home it is the leading J F MA M J J A S O N D J F M AMJ J A revenue would have been 9 % dollar as the API input costs for ARVs in SA
supplier of generic medicines 2015 2016 higher than the previous will be mitigated by the group’s hedging TOP SIX HEALTH CARE
Source: IRESS Share prices based to 100
to both the private and the period. polices and the implementation of quarterly Ranked by Name Net profit Rm Total assets Market cap Equity funds
public sectors and has Latin America in general single exit pricing adjustments by net profit Rm Rm Rm
production capabilities for a wide variety of wasn’t kind to the company’s bottom line due to government.
product types. including tablets, capsules, steriles challenging economic conditions and regional However, local margins in the private 1 Aspen Pharmacare Holdings 5,966 38,969 146,114,571 33,646
and injectables. currency weakness. The Brazilian Real was sector business will squeezed by the recent 2 Netcare 2,590 27 ,42 52,760,503 11,793
In June Aspen struck a deal to buy British among the worst performing emerging rand depreciation, but management is 3 Life Healthcare Group Hldgs 1 ,755 1 2 , 627 374,09 1,03 4,45 6
drug giant AstraZeneca’s anaesthetics portfolio currencies during the period. confident that they can reach and exceed the 4 Adcock Ingram Holdings 438 4,703 7,731,156 2,909
5 Afrocentric Investment Corp 238 745 2,777,430 1,017
worldwide except the US for at least US$520m – On a better note, a stronger Euro contributed targeted savings of R2.5bn by 2019 through
6 Ascendis Health 234 1,572 6,227,742 1,909
a day after it secured €3bn in funding from 27 to a 9% increase in revenue from Europe, but was consolidation and synergies.
Source: McGregor BFA
banks. partly mitigated by the rapid currency The projects identified to achieve this

42 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 43
Financial Mail Page 44-45 -29/08/16 02:33:58 PM

✥ RETAIL ✥ ✥ RETAIL ✥

Excelling

Sunday Times
proved to be a stroke of genius. The performance and share price movement has been

SECTORS
SECTORS

transformation of Australian retailer David Jones disappointing since the group was acquired by
continues apace under the watchful gaze of WalMart in September 2010, giving rise to

in tough
Woolies’ Scottish/Australian CEO, Ian Moir, who unsubstantiated speculation that WalMart may
has vast experience in the Australian retailing dispose of Massmart in future.
market. Pick n Pay managed to claw back some
Truworths bounced back in 2015 after market share from arch-rival Shoprite during the

times
languishing somewhat in recent years. course of 2016, though its profitability is still
Jean-Christophe Garbino, the CEO-designate who nowhere near where it needs to be. The group
came from French discount fashion chain Kiabi, signaled its intention to collapse its controlling
resigned abruptly towards the pyramid structure (PikWik) in
end of last year. Long-serving RETAILERS June 2016, although the
CEO Michael Mark took back Food & drug retailers index Ackerman family will still
Consumer spending in the reins of power and is still General retailers index retain control via the issue of
directing the business. All share index unlisted “A” shares.
South Africa is still Truworths also acquired UK
124
Clicks continued to exhibit
120
demonstrating profound fashion retail chain Office
Retail during 2015. Financial 116
solid results during 2015,
largely as a result of its
resilience year 2016 results came out in 112
108
pharmaceutical wholesaling
mid-August and, although subsidiary, UPD. In June 2016,
Ian Moir superficially surprisingly 104 it announced that it will take

C
strong, the market punished 100 over the management of
onsumer spending in South Africa the shares, which fell by over 96 Netcare’s Medicross retail
remains under relentless pressure from 8% on the day of the results. 92 pharmacies and its hospital
chronically high levels of One area of concern for 88
pharmacies.
unemployment, high imported inflation, investors appears to be the J F MAMJ J A S O ND J F MAMJ J A Lewis Group continues to
reduced access to unsecured credit, gradual reduction in profit 2015 2016 struggle in the difficult
Source: IRESS Share prices based to 100
moderating wage increases and high competition, even though some of them have a margin, which arises as a furniture retail sector.
administered price increases, such as those from limited reach. This is one of the reasons that result of regulatory restrictions Although a well-managed
Eskom and other utility companies. And yet the certain local clothing retailers have branched out on credit granting in South Africa, coupled with a company with a long pedigree, affordability
South African consumer remains remarkably offshore in search of new growth. growing proportion of pure cash sales, especially guidelines introduced by the National Credit
resilient, as evidenced by continuing robust Shoprite remains by far the most profitable from operations like Office Retail. Regulator coupled with an inability by many
earnings growth from certain sectors of the retailer in South Africa, with pre-tax profit almost Mr Price Group experienced something of a consumers to purchase high-value furniture and
retailing sector. Retail sales growth in May came five times that of erstwhile supermarket rival hiccup in its third quarter 2016 results but appliances for cash means that Lewis (and most
in at over 4.5%, way above all expectations, Pick n Pay Stores. Even so, 2015 was a tough year recovered to post a reasonable full year 2016 set other furniture retailers as well) is finding the
though it subsequently fell back to a more for Shoprite, with subdued consumer spending in of figures. This share has been a firm favourite of going very tough at present.
moderate 1.7% year on year figure in June. both its home base of South Africa and further offshore investors for many years and is deemed Staff writer
Nevertheless, consumer spending in South Africa afield in the rest of the African continent. Lower by many local investors to be

Ruvan Boshoff
is still demonstrating profound resilience. One oil prices in Nigeria and Angola made trading in priced for perfection. Little
reason for this strength appears to be the both of these jurisdictions more difficult. At the wonder, then, that its share price
important influence of the informal sector, which time of writing, Shoprite had just released its tends to drop sharply on the rare
is estimated to be at least 20% of GDP. results for the financial year ended June 2016. occasions that earnings growth
In recent years, the clothing retail market has This showed a marked improvement on the 2015 doesn’t quite come up to
also had to contend with an influx of foreign year, with turnover increasing by 14.4%, or by scratch.
clothing retailers such as Zara, Cotton-On and 11.6% if the same number of weeks in the The Foschini Group has been
more recently, Hennes & Mauritz (H&M) of previous year is used to make the comparison. reclaiming much of its former
Sweden. These foreign chains are providing stiff Market share remined above 30% and operating glory in recent years and has Gareth
profit margin was maintained at been vigorously pursuing an Ackerman
TOP SIX RETAIL a very healthy 5.6%. offshore expansion strategy. Its
Ranked by Name Net profit Rm Total assets Market cap Equity funds Woolworths’ profitability first acquisition-Phase Eight in
net profit Rm Rm Rm might be a lot less than that of the UK in early 2015-was
Shoprite but its market followed by the Whistles
1 Shoprite Holdiings 4,785 41,949 99,462,029 17,151 capitalisation is not far behind, acquisition in March 2016.
2 Woolworths Holdings 3,707 23,706 93,753,800 11,393 thanks to a significantly higher The Spar Group, fresh from
3 Truworths International 2,472 8,435 42,658,073 6,637 p:e ratio. Perhaps fortuitously in its success in buying Spar

Trevor Samson
4 Mr Price Group 2,293 7,387 45,011,128 3,954 retrospect, its decision to exit Ireland and south-west England
5 The Foschini Group 1,868 13,814 30,459,229 7,454
Nigeria three years ago and last year, recently bought Spar
6 The Spar Group 1,662 16,011 34,481,225 2,829
instead concentrate its Switzerland as well. Michael Mark
Source: McGregor BFA
resources on Australia has Massmart’s operating

44 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 45
Financial Mail Page 46-47 -29/08/16 02:34:29 PM

✥ MEDIA ✥ ✥ TELECOMMUNICATIONS ✥

Still sailing emphatic: the group will continue to grow as it

Business trying to understand what went wrong.

SECTORS
SECTORS

diversifies into new sectors, such as e-commerce. The Nigerian debacle is seen as more of a
However, under Van Dijk it has been more of a symptom of the underlying problems the group
frantic exercise on a number of fronts without has experienced in recent years.

the rough any real benefits so far. Naspers’ share price


remains more Tencent-driven than ever before.
The bounce in its share price at end May was
conditions Difficulties included sluggish local growth in a
competitive market in SA, investments in risky
countries (which apart from Nigeria also include

seas cause for


firmly ascribed to Tencent’s new forays into Iran), a lack of managerial flair, a retracting
developed markets, rather than based on Naspers’ customer base, difficult labour relations, faulty
own e-commerce investments. Analysts routinely technical systems and erratic customer service.
explain the Naspers performance by referring By the end of April MTN had increased its

The industry seems unlikely


simply to what Tencent is doing — nothing else it
does seems to move the share price.
Tencent’s growth comes at a crucial time for
Naspers’ revenue flows, which recorded only
concern subscriber base 1% to 230.3m, but there was a 7%
drop in Nigeria and 11% in Uganda.
At a p:e ratio of 17, MTN still appeared pricey
against the background of Nigeria suspending
to survive current phase as pedestrian growth of 5% in US dollar terms in the negotiations on the fine — but this was finally
sector evolves interim period to end September 2015, compared
with the annual 16% recorded at end March. Recent costly incidents have
sorted out with an agreement to pay a third of
the original $5.2bn over three years. The
This slump led to renewed questioning of re-appointment of Nhleko — the man who

N
Naspers’ strategy by analysts left industry players wary of transformed MTN into a market powerhouse —
aspers remains the MEDIA
dominant company
and ratings agencies.
Continued revenue growth is
taking on risks as executive chairman did offer some short-term
direction. In June the board made several
Media index 150
on the JSE’s media regarded as important for the important appointments, including Rob Shuter

B
All share index 145
sector, and at 140 group, with some analysts from Vodafone as CEO and Paul Hanratty of Old
R990bn at 135 punting a share price target of usiness conditions can change quickly in Mutual as a non-executive director.
end-May, also had the 130 R3,000. the fast-moving telecommunications However, much of the value destroyed in the
fourth-highest market 125 Continuing on the path of sector. Two years ago MTN was the aftermath of the fine has not been recovered.
120
capitalisation on the local takeovers and investments at darling in the mobile Vodacom’s more favourable
115 TELECOMS
market. all costs, however, may not be operating market, market valuation is based on
110
It has been a stratospheric the preferential road for the trading at a peak of R263 Telecommunications index its recent annual results, with
105
All share index
ride for Naspers over the past 100 group, with e-commerce reached on September 8 2014. 115 data revenue up 28%,
few years as its early 95 ventures delivering little in Vodacom was at R130. Today, 110 supported by strong network
investments under previous J FMAMJ J A SO ND J F MAMJ JA profits up to now. Vodacom is at R165 with a 105 investment. Active customers
CEO Koos Bekker in the 2015 2016 To a degree, Naspers has market cap of R246bn, with 100 rose 8.6% to 28.8m. But at a p:e
Source: IRESS Share prices based to 100
Chinese gaming group listened to some of the MTN at R125 and a smaller 95 of 18 it does not offer much
Tencent, as well as in the criticism by selling off the low market cap of R232bn. Over 90 more value than MTN at
85
Russian Mail.ru interests, proved remarkably margins, such as Mweb, Ricardo, 7 Pixel, Netretail, the five years since June 2011, present valuations.
80
successful. Heureka and Price Check. Billions of dollars were Vodacom’s share price has A cloud on the horizon
75
In the first quarter of 2016 the ride stalled spent on some of these investments, with little to doubled while MTN is back remains a possible payment to
70
somewhat, however, with the share price show. At the same time its Indian Flipkart where it started. 65
Nkosana Makate, the former
retreating around 3%. The high-flying company investment has not met growth targets. At end May MTN was down 60 Vodacom employee who had
had strengthened 40% in 2015, 38% in 2014 and a Therefore questions remain over the efficacy 5% for the year, having lost J F M AMJ J A S O N D J F MAM J J A for years claimed to be the
2015 2016
remarkable 101% in 2013. of many investments, the latest being ShowMax. 40% in 2015. Vodacom was 8% inventor of the popular “Please
Source: IRESS Share prices based to 100
Central to the group’s future is the question if Calls have been made for the group to sell more higher after gaining 18.6% in Call Me” service. The
it can continue with this sterling growth. At a p:e of its investments to increase earnings growth 2015. constitutional court finally
of 100, a lot of the good news seems priced in. and, more importantly, dividends for investors. Both companies had a difficult 2015. Vodacom awarded Makate the right to compensation after
The reaction of new CEO Bob van Dijk, with The group has been prone in the past to spring was punished early on by the market as lower Vodacom denied that he was the original
Bekker still as non-executive chair, has been surprises on investors. Ratings agency Fitch is interconnect revenues affected earnings. But inventor. Maarten Mittner
lukewarm about Naspers’ present investment Vodacom adapted and today
TOP SIX MEDIA case. It has retained the group’s BB+ rating for interconnect revenues make up TOP FIVE TELECOMS
Ranked by Name Net profit Rm Total assets Market cap Equity funds now, but warned that capital expenditure had a much smaller percentage of Ranked by Name Net profit Rm Total assets Market cap Equity funds
net profit Rm Rm Rm to decrease in the following two years. revenues. net profit Rm Rm Rm
The activities of other pure media players, MTN’s fortunes were much
1 Naspers 13,566 802,250 902,492,528 755,846 such as Caxton, cannot really be measured worse, as the company reeled 1 MTN Group 28,606 215,394 378,719,160 123,726
2 Caxton 456 6 ,88 5,969,418 5,267 against those of Naspers as Naspers’ media under the US$5.2bn fine issued 2 Vodacom Group 13,818 63,563 238,861,255 17,850
3 E Media Holdings 307 2,342 606,197 6,499 print interests deliver only 1% of profits at by the Nigerian communication 3 Telkom SA Soc 3,334 38,938 30,336,436 24,164
4 African Media Entertainment 49 259 642,498 168 present. Caxton’s share price gained 10% last authorities. From a blue-chip 4 Blue Label Telecoms 630 5,735 10,286,262 3,719
5 Tiso Blackstar Group SE 42 255 2,414,621 230 5 Telemasters Holdings 4 39 43,680 30
year, but was 16% down at end May. company, it has now fallen out
6 Moneyweb Holdings -3 27 30,176 22 Source: McGregor BFA
Maarten Mittner of the top 10, with analysts still
Source: McGregor BFA

46 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 47
Financial Mail Page 48-49 -29/08/16 02:34:54 PM

✥ BANKS ✥ ✥ BANKS ✥

A mixed post after all. The president later said he would annual pullback in 2015, with its share price supposedly to be the final shelving of the red

SECTORS
SECTORS

be replaced by a previous incumbent, Pravin falling 24.2%. At a historic p:e ratio of 7.6 it is also Absa trademark. The Absa tag had through the
Gordhan. On the Monday the index rebounded the lowest rated by the market, compared to years become progressively smaller in the group’s
8.5%. Since those dark days the banking index FirstRand’s 10.9 and Standard’s 8.6 times. public profile, with the blue Barclays eagle

bag of has recovered further in 2016, but progress has


been uneven and fragile. At end-May the index
was up a marginal 4.6% for the year, after
Annual results for 2015 were a mixed bag for
Nedbank, with the market mainly focusing on
Ecobank’s first full-year contribution after its
increasingly prominent.
In a strategic change for the group at end 2015
Barclays CEO Jes Staley announced the group’s

fortunes
dropping 16.3% for the full 2015. In 2014 the index Nedbank debt was converted to equity, with intention to sell its Barclays Africa interests again,
rose 26%. Nedbank now owning 20% of Ecobank. with onerous global regulatory and capital
The challenges in 2016 were evident in the Ecobank’s results reflected an attributable requirements given as the reason behind the step.
share price performances of the bigger banks. profit of $71m. Nedbank’s share of this amounted Since then Barclays plc’s holding in Barclays
Nedbank was down 3% at end May but Barclays to about R240m, but there were some questions Africa has fallen to 50.1% with a number of
Africa was up 2%. FirstRand was 2.5% firmer. about Ecobank’s fourth quarter losses of R676m. parties vying for the remaining interest, ranging
Banking index has Standard Bank and Capitec were the best Nedbank CEO Mike Brown ascribed it to from previous Barclays CEO Bob Diamond’s Atlas
performers at end May, both gaining around 10%. increased impairments on exposures related to Mara group to Patrice Motsepe’s African Rainbow
recovered since Nenegate Banks continued to steer difficult paths, as the the slowdown in economic growth across Africa, Capital.
crisis but remains fragile macroeconomic environment remained a major
concern, with related risks around interest rates
as a result of lower commodity prices. But these
challenges are not expected to
Diamond is the long-shot candidate. He has
teamed up with the private
and the weak rand. abate quickly. BANKS equity Carlyle group to

W
“SA’s economy is subdued, the currency down, On the positive side Barclays Africa provide more muscle to Atlas
ednesday, December 9 2015 GDP forecasts lower, and the economy is plagued Nedbank’s NII grew at low FirstRand Mara’s modest capital
ended on a reasonably positive by labour unrest and strikes,” PwC said in a double-digit levels, supported Nedbank resources.
Standard Bank
note for the JSE’s banking index. report released earlier in the year. by continued growth in 125 Then there is the Middle
The banking index closed 1.09% Among the big four, Standard Bank’s solid average interest-earning 120 Eastern Abraaj group, which
higher in continuation of a more position in the share price growth stakes can be banking assets as the group 115 recently stated its interest in
110
positive trend evident in the week as the index justified on its 2015 performance. Under the dual continues to make forays into buying a stake in Absa, shortly
105
recovered from a torrid previous few weeks in leadership of CEOs Sim Tshabalala and Ben the consumer market with 100
after president Jacob Zuma
the shadow of a possible ratings downgrade and Kruger, full-year profits rose 27% to R22bn, innovative products, such as 95 paid an extended visit to
as negative emerging market sentiment weighed mainly driven by a rebound at the corporate and the Savvy account. The net 90 Middle-Eastern countries to
on the market. investment bank. interest margin for the period 85 improve business ties.
For the two full weeks from November 23 to After languishing for years, the return on widened slightly from 2014’s 80 It seems increasingly likely
75
the end of the first trading week of December, equity (ROE) rose to a more respectable 15.3%, 3.3%. that black empowerment
70
the index did not close in positive territory once. with bad debts under better control than at any Barclays Africa under CEO groups will eventually obtain a
But it was safe to say that most bankers expected point since the 2008 financial crisis. Maria Ramos has steadily J FMAMJ J A S OND J FMAM J J A large stake in Barclays Africa.
2015 2016
to sleep well, or at least better, on that fateful However, Standard Bank remains oddly prone improved its financial metrics Source: IRESS Share prices based to 100 A frontrunner includes the
Wednesday night. to mishaps, the latest being a globally coordinated over the past year. The ROE Public Investment Corporation
Then came the press release: President Jacob fraud attack involving forged bank cards used at has climbed to 17.6%, as (PIC). PIC CEO Dan Matjila is
Zuma announced that respected Finance Minister ATMs in Japan, which cost the bank R300m. This lending was curtailed, resulting in less bad debt. reportedly keen to increase the PIC’s present 7.3%
Nhlanhla Nene was being replaced by a certain followed on the aluminium double-invoice In 2015 Barclays Africa increased revenue by stake in Absa, but is apparently not aiming for an
David van Rooyen, with immediate effect. contract fraud perpetrated at Chinese harbours, 4% with headline earnings rising moderately by eventual interest of above 20%.
The shock waves swept through the market which also cost Standard Bank dearly. 10%. The impairment loss ratio decreased to Investec was one of the best performers in
on Thursday December 10, with the index closing In the market cap stakes, however, FirstRand 0.89% from 0.94%. Barclays Africa is in the midst 2015. At Capitec the main question among
13.5% lower. The fall continued on the Friday remains top. With seasoned banker Johan Burger of wide-ranging changes, initiated by majority investors is if the group will continue its strong
with the index shedding a further 5.8% as the at the helm after the retirement of Sizwe shareholder Barclays plc. run of the past few years. Its share price rose 58%
market braced itself for the coming Monday Nxasana, FirstRand’s market cap of R245bn is still The blue-chip British bank has blown hot and in 2015, but growth has shrunk to around 10% so
session. But then, on Sunday December 13, it was comfortably ahead of Standard’s R202bn. cold in the SA market for years. For decades it far this year as the group faces accusations of
announced Van Rooyen would not stay in his The overall credit loss ratio rose to 0.95% from was a stalwart on the local banking scene. Then reckless lending, which it denies.
0.89%, forcing FirstRand to make hefty in 1987 it divested by selling Barclays to the men At a p:e of 20, Capitec remains the most highly
TOP SIX BANKS provisions against the background of subdued running what later became FirstRand. They rated local bank.
Ranked by Name Net profit Rm Total assets Market cap Equity funds income growth. transformed Barclays into First National Bank Progress has been made in transforming the
net profit Rm Rm Rm Earnings were up a pedestrian 9%, with (FNB). African Bank “good bank” into a viable operation,
net interest income (NII) firming 9% and total In 2005 Barclays plc had a change of heart. For and at end-May the business rescue of African
1 Firstrand 21,471 1,056,543 83,591 271,330,934 noninterest revenue (NIR) increasing only 5% reasons not totally clear, it became more positive Bank Investments Limited (Abil) — the holding
2 Standard Bank Group 15,507 1,879,172 134,111 271,884,790 as the group seemingly reached a platform in about the SA banking scene, buying a 55% stake company of African Bank — was successfully
3 Barclays Africa Group 13,486 987,230 78,661 156,833,875 fee and commission income. First National in Absa for $5.5bn in 2005. In 2013 it bought a concluded. On face value, SA banks do offer an
4 Nedbank Group 10,819 916,077 72,993 96,220,104 Bank (FNB’s) retail books showed good asset further 8% of Barclays Africa for a substantial investment opportunity. The fortunes of SA
5 RMB Holdings 7,769 102,146 98,623 86,480,939
growth but WesBank’s new-business volumes R18bn, to increase its stake in Absa to 62.3%. banks are intricately linked with what happens in
6 Capitec Bank Holdings 2,547 53,369 10,362 66,257,734
were muted. Nedbank remains the runt The changes now being implemented were developed markets.
Source: McGregor BFA
among the pack. It recorded the biggest not those initially predicted, which were as Maarten Mittner

48 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 49
Financial Mail Page 50-51 -29/08/16 02:35:19 PM

✥ LIFE INSURANCE ✥ ✥ LIFE INSURANCE ✥

Big to being simply Old Mutual) will be a coming off a low base in Van Zyl’s early years. It investors — and, in the corporate market, Stable

SECTORS
SECTORS

self-contained business. It is already well remains a solid asset gatherer, with new business Growth. Dloti says new-business growth was
capitalised in its own right, and should have no volumes up 9% in the four months to April, and subdued in the first quarter of the year, partly
difficulty passing the upcoming Solvency its operating profit was up 7%. because the bank brokers at Nedbank, FNB and

players’ Assessment & Management (SAM) requirements.


Mupita says the business and the life industry
as a whole are facing challenges from lower
Liberty is quite a neglected share. Under CEO
Thabo Dloti it has continued to grow in areas of
strength: it is the number one writer of risk
Absa switched from Liberty to in-house product
houses, and patly because it had limited capital to
offer guaranteed investment plans.

growth
growth and rising unemployment. But he says business in the mass affluent market. Clearly, no loyalty programme can match
there are still pockets of growth. But he accepts that the traditional face-to-face Discovery’s Vitality. It is the cornerstone of all its
Sanlam has gone through its own, more sales model is not suitable for all Liberty’s clients. business units and it has enabled the business,
low-key change as a year ago Johan van Zyl For example, the millennials would much rather led by Adrian Gore, to cross-sell effectively,

predictions handed over the CEO’s baton to Ian Kirk. Kirk is


no stranger to running a listed company, as he
was previously head of Capital Alliance and
Santam.
do their research online and make their own
purchases. “We are increasingly adopting an
omni-channel approach,” says Dloti.
Liberty has also had some successful
particularly between its two largest businesses,
Discovery Life and Discovery Health.
MMI Holdings, which has a common
shareholder with Discovery in RMI, is going
Kirk says Van Zyl played a transformational on-balance sheet investment products, such as through some significant re-engineering.
role getting Sanlam on a solid footing, with Evolve — which appeal to more conservative Stephen Cranston
Industry faces challenges judicious use of capital. After he sold the 19%
holding in Absa to Barclays, he saw the
from lower growth and opportunity get into emerging markets through SHORT-TERM INSURANCE mainly because of rand weakness. And there
were significant hail claims in Gauteng and
rising unemployment the acquisition of African Life in 2005. Kirk says
that Sanlam is now operating in all the African Affordability has changed North West Province in January.
markets in which it would like to trade, other Large commercial property claims and

T
than Egypt and Ethiopia. the game higher drought-related crop insurance claims
his year has proved to LIFE INSURANCE Santam has partnered are keeping insurance executives awake at
be a historic one for Life insurance index Sanlam in its emerging The short-term insurance board has two night. Right now affordability is a serious issue,
the life insurance All share index markets expansion, taking counters again. In the early 1990s it was a and many clients are renegotiating their cover
sector. Its largest 120 35% of its interest in each vibrant sector, with firms such as Commercial to suit their constrained budgets.
company by market 117 territory. Though it expects Union, Guardian National and Mutual & Federal CEO Lize Lambrechts says that with Santam
cap, Old Mutual, will not exist 114 short-term weakness in fighting for investor attention. having such a high market share in SA, much of
in its present form within two 111 African economies, there was All these and many more have been bought its earnings growth will now come from
108
years. still a 40% increase in new out. Santam used to have at least one major overseas, either through the business Santam
105
Under CEO Bruce Hemphill business volumes at Sanlam competitor on the boards, Zurich SA, but in writes in dollars internationally or through the
102
it will be split into four. What Emerging Markets over the September 2015 its parent company decided it interests it holds in partnership with Sanlam in
99
is now called Old Mutual first four months of the year. would be much more efficient to run Zurich’s the insurance businesses throughout Africa and
96
Emerging Markets (OMEM) And Sanlam has no desire, Johannesburg-based subsidiary without outside Asia.
93
will become, in effect, the under Kirk, to increase its shareholders to worry about. It recently finalised its purchase, with Sanlam
90
rump of Old Mutual. The exposure to developed There is now a second short-term listing to Emerging Markets, of 30% of Saham Finances,
J F M AMJ J A S O ND J F MA MJ J A
implied market cap of this 2015 2016 markets. keep Santam company, Indequity. This was spreading its tentacles into Morocco and much
rump would be about R90bn. Source: IRESS Share prices based to 100 He is happy with its previously the last man standing on the of Francophone Africa. Lambrechts says
And though there should be bridgehead in London, which development capital market, a predecessor of Santam’s capital is at the top end of the target.
some rerating, it is highly unlikely to equal the offers asset management and wealth the Alt-X. It hardly compares with Santam in But so far there are no hints of special
market value of Sanlam, currently R134bn. management support to the greater group. scale: it has about R45m/year of gross written dividends.
OMEM head Ralph Mupita says the central office Sanlam is unlikely to step into the vacuum left premiums, compared with about R23bn from The group needs to be sure that it has the
at Old Mutual plc has supported its business — by Old Mutual. Old Mutual now has a strong Santam. It sells mainly through two products, right capital base for the forthcoming Solvency
and will continue to do so for the next two years vertically integrated financial services business, Uniq-cover and Probiz, and is based in Assessment & Management regime. It hopes to
— but the intention is that OMEM (likely to revert which includes asset manager Old Mutual Global Randburg. get its own internal model approved, which
Investors, adviser network Intrinsic, high net Santam’s more serious competitors are the would mean little change in its approach to
TOP SIX LIFE INSURANCE worth adviser Quilter Cheviot, as well as the two firms fighting it out for the number-two capital — but it is by no means in the bag.
Ranked by Name Net profit Rm Total assets Market cap Equity funds investment product platform acquired as part slot, Mutual & Federal, which was once the It continues to have very strong capital
net profit Rm Rm Rm of the Skandia purchase. number one, and the rather less corporate and management, and recently introduced a zero
Some analysts estimate that this business more quirky Hollard. cost fence over R10bn of equities, with
1 Old Mutual Plc 12,680 2,515 668 198,369,643 121,977 is worth more than the whole of Old Mutual Santam beat all comers last year with a downside protection of 10% and upside
2 Discovery 6,717 83,866 78,662,495 30,388 SA. But then Mutual had to kiss a lot of frogs phenomenal underwriting ratio of 9,6%. participation of 10.3%. It had a similar
3 MMI Holdings 3,296 433,235 39,166,283 27,178 before finding this business. According to an update released on June 1, so protection in place around the time of the
4 Liberty Holdings 2,930 374,909 48,039,068 22,024 Old Mutual looks like a buy as the share far this year the group has achieved a net global financial crisis, which protected the
5 Clientele 369 2,692 4,801,029 444
price does not yet reflect the sum of the parts. underwriting margin in the 4% to 8% range: balance sheet effectively.
6 Sanlam -675 667,815 148,381,653 50,525
Sanlam, on the other hand, is unlikely to there is continuing pressure on claims costs, Stephen Cranston
Source: McGregor BFA
show the kind of growth it had when it was

50 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 51
Financial Mail Page 52-53 -29/08/16 02:35:44 PM

✥ FINANCIAL SERVICES ✥ ✥ INFORMATION TECHNOLOGY ✥

A viable Iceland. Brait is one of several holding companies

Mergers headline earnings per share decreased 47% to

SECTORS
SECTORS

in the Christo Wiese stable. 19.4 US cents.


It has some legacy investments in SA such as As a global company, Datatec is affected by
Consol and Primedia, which do not form part of currency movements and sentiment towards

sector in its long-term portfolio: its largest local


investment, Pep, was sold to Steinhoff last year.
Diversified financials is certainly the place for
could emerging markets. North America contributes
35% of revenue, mainly through Westcon, Europe
34%, Latin America 14%, Asia-Pacific 9% and

its own rescue the


larger-than-life moguls. Another highly Africa and the Middle East only 8%.
successful group is PSG, run by Jannie Mouton Analysts say the group needs to focus on
and his scarily similar son Piet. Its asset higher growth segments, with a recent takeover
management and insurance business, PSG in Spain expected to boost growth prospects.

right Konsult, is also on the board, as is the agricultural


holding company Zeder.
Only one of the large asset managers,
Coronation, is listed in its own right. It has had a
sector However, development of positive sentiment to
emerging markets may take a while.
These factors have weighed on Datatec’s share
performance, with the share price losing 12.7% in
tough year. In last year’s Top Companies it had a 2016 to middle May. It is probably fairly valued at
market capitalisation of R34bn. This has fallen to a p:e ratio of around 16. Datatec ended 2015 7%
Diversified financials the R23bn. In the six months to March 2016, it The acid test is to continue lower.
suffered net outflows of R47bn. Though smaller than EOH and Datatec, much
place to be for It has continued to see most of these outflows delivering through the of the recent corporate action in the IT sector has
larger-than-life moguls come from its institutional products, though it is
still a juggernaut with R606bn under
cycles been around Pinnacle and Datacentrix.
On face value Pinnacle had a good six months
management. CEO Anton Pillay says the key to end December, with revenue up 19% to

T W
driver of success is the ability to create long-term R4.3bn. Growth came from its infrastructural
hough most of the financial sector is value on behalf of clients. ith a market cap of R19bn, EOH products and new technologies divisions.
made up of clearly defined banks, But there are also a few niche managers to Holdings has been the high-flyer Operating profit margins improved to 5.3%
insurance companies and, increasingly, choose on the JSE. The most hyped is Anchor, in the much reduced information from 5.2% previously, and headline earnings
property companies, there is the headed by Peter Armitage, which has had the technology (IT) sector on the JSE. grew by 20% to R150m.
catch-all diversified financials category. best performing equity fund in SA. It is on a rich At end-May the EOH share price Pinnacle’s share price was up 20% by end
It is a collection of often uncomparable 24,5 p:e, almost double Coronation’s. Anchor has was up an annual 3.7% after growing 24% in 2015, May. Since 2013 Pinnacle has steadily increased
companies. The largest sub-sector is asset also been buying into other fund managers, such 34% in 2014 and 112% in 2013, making it the its stake in Datacentrix to a current level of 55.3%.
management and custody banks, but even this as hedge fund specialist Capricorn, and buying a best-performing stock on the JSE in that year. There is speculation that Datacentrix, with a
includes shares such as Brian Gilbertson’s vehicle number of financial advisers. Being a firm favourite is one thing. The acid market cap of about R1bn, could be delisted.
for investing in mining, Pallinghurst, as well as In contrast, the market has taken little notice test is to continue delivering through the cycles. Pinnacle CEO Arnold Fourie says initiatives to
Reinet, which invests in British American of Prescient, which flounders on a 14 p:e. Perhaps EOH has proven itself adept at doing just that, explore the synergies between the two
Tobacco. unlike the all-too-human Armitage, the Prescient delivering 24% interim earnings growth at end companies are being pursued.
It has a “fund manager”, but its only purpose team comes across as propeller heads, and its January 2016 despite subdued economic growth. Pinnacle’s core business is in the distribution
is to take a fee out of the company. It is not a quants-based funds just a little too highbrow. Revenue was up 30% at R6bn and operating of hardware technology products, while
wholly passive investment, however, as it also The share that has been a real hit on the profit climbed 35% to R682m. Datacentrix operates in the technology services
controls the Pension Insurance Corp, a pension market has been Sygnia, an administrator and Despite buying majority stakes in five offshore market as a systems integrator.
administrator in the UK. asset manager run by the far-from-dull Magda firms at end 2015 EOH remains firmly rooted in Datacentrix’s annual performance in 2016 was
The sector also includes Brait, which has its Wierzycka. Sygnia is well-placed to grow as a the local economy, with SA contributing 87% of much improved. It reported revenue rising 16% to
origin as a private equity fund. It now looks multimanager both for discretionary clients and revenue. R2.6bn with attributable
increasingly like a consumer-facing business for clients of the new Sygnia Umbrella The company says it plans SOFTWARE & COMPUTER SERVICES earnings rising 19% to R123m
conglomerate, with investments such as Premier Retirement Fund (Surf). to further increase activities in Software & computer services index on total revenue lifting 16% to
Foods in SA, Virgin Active (globally), fashion As it is, the institutional component of the government sector while All share index R2.6bn.
145
retailer New Look and frozen-foods chain Investment Solutions (IS) experienced a 15% fall keeping its eye on growth At a price:earnings of 7.9
140
in operating profit and there were opportunities in the rest of Datacentrix is among the
135
TOP SIX FINANCIAL SERVICES withdrawals of R47bn during the year. The Africa and in the Middle East. cheapest of the IT players and
130
Ranked by Name Net profit Rm Total assets Market cap Equity funds core IS product, Performer, which accounts Its p:e ratio of 20 is roughly in 125
the company has virtually no
net profit Rm Rm Rm for 43% of assets under management, has still line with that of the JSE 120 debt. Its share price was 6% up
had a good performance, with an 8,75% return all-share index. 115 at end May after the group
1 Brait SE 23,026 42,517 86,944,347 38,975 in the 12 months to March compared with Datatec’s progression has 110 gained 34% in 2015.
2 Investec 5,883 787,226 32,023,784 53,993 5,49% for the peer group. been less spectacular than that 105 Overall, the poor economy
3 Investec Plc 5,883 787,226 67,175,172 53,993 In January Peregrine was picked as the of EOH. But with a market cap 100 has been a challenge for the
4 Coronation Fund Managers 1,834 68,754 25,675,254 1,158 Financial Mail hot stock in the diversified of R9.4bn it remains a sizeable 95 local IT market. Mergers and
5 PSG Group 1,690 57,440 46,271,099 24,866
financial sector. It still has a long way to go, as player. Reporting in US$, its J FMAMJ J A SOND J FMAM J J A
acquisitions could become the
6 JSE 861 38,152 12,944,762 2,368
the share is down 5,5% over 12 months. 2016 results showed revenue 2015 2016 norm in 2016.
Source: McGregor BFA Source: IRESS Share prices based to 100
Stephen Cranston slightly up to $6.5bn, but Maarten Mittner

52 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 53
Financial Mail Page 54-55 -29/08/16 02:23:32 PM

✥ PROPERTY ✥ ✥ PROPERTY ✥

Cash still Investments (+13.4%), Investec Australia Property contributors to growth. In recent months, the race

SECTORS
SECTORS

Fund (+12.1%), SA Corporate Real Estate Fund Jankelowitz says given that GDP among SA property stocks to enter
(+10,8%) and Fairvest (+10%). is still losing momentum, it is the region has hotted up
While the J253 index as a whole is up around difficult to expect stellar considerably with Tower Property

king amid 11% between January 2 and May 30, there is a


growing divergence in the share price
performance of individual property stocks. For
performances out of underlying
assets of local property stocks.
Growth rates are set to slow down,
Fund, Attacq and Accelerate
Property Fund making acquisitions
in countries like Croatia, Serbia,

growing
instance, the difference between the sector’s best but still remain positive. “We Cyprus and Slovakia. Others,
and worst performer year to end-May is a hefty caution buying at these levels on a including the likes of Texton and
40% - blue chip mall owner Hyprop with a share nominal basis, but appreciate the Equites Property Fund, are going
price gain of just more than 16% versus relative attractiveness in a world of offshore via the UK.

uncertainty London-focused Capital & Counties Properties


(Capco) with a drop of 24%, according to figures
from Absa Wealth and Investment Management.
The sharp drop in Capco’s share price was
uncertainty.’’
PSG Wealth Chief Investment
Officer Adriaan Pask echoes that
sentiment: “We continue to remain
Pask says PSG Wealth remains of
the view that the interest rate cycle
will affect domestic economic
strength, affordability and
attributed to fears surrounding the potential exit cautious on valuations given the sentiment. “In addition, other
by Britain from the EU and an appreciating rand current state of property income-generating assets with
Property stocks benefit against sterling (up 8.1% in the first quarter), fundamentals in SA. While changes positive correlations to interest rates
which negatively affected the performances of in capital markets may drive will become increasingly attractive,
from the continuing search most UK-focused property companies. Other top short-term performance, we placing further downward pressure
for yield performers include Redefine Properties,
Hospitality A and Resilient, which are all up
maintain our view that real estate
fundamentals will drive
on listed property.’’
He notes that PSG Wealth
about 14% year to date. performances over the long run.’’ currently favours property counters

D
The performance gap becomes even more Pask notes that the sector’s with the following characteristics:
Evan Jankelowitz
espite choppy trade in recent months, pronounced over a 12-month period, with UK still-positive earnings performance low price-to-book values; low
the SA listed property index managed and African-focused Tradehold, in which retail has been driven mostly by levels of debt/gearing and strong
to notch up a respectable 11% price tycoon Christo Wiese owns a majority stake, companies with earnings exposed to offshore credit ratings; superior dividend growth track
gain in the first five months of 2016. If boasting a share price gain of 73% for the year assets. Hyprop and Redefine Properties earlier records; globally diversified portfolios, or
one brings the average dividend yield ending May. That compares to a share price drop this year became the latest supporters of the counters that generate earnings abroad like Nepi,
of about 6.5% into the equation, the total return of 35% for the sector’s losing counter, Ascension growing trend amongst local property companies Rockcastle, New Frontier Properties, Capco, Intu
delivered by property stocks year to date rises to A, which owns a large portfolio of to diversify their assets beyond SA’s borders. In Properties, MAS Real Estate, Sirius Real Estate,
more than 17%. government-tenanted offices and has been the early February, Hyprop made its first foray into Redefine International and Investec Australia.
That is ahead of the all share index’s 14% or so target of a take-over attempt. Eastern Europe after acquiring two shopping Stanlib head of listed property funds Keillen
over the same time. Analysts are typically expecting an average malls in Serbia and Montenegro for a total Ndlovu agrees that investors will have to become
Analysts say that the relatively strong total return from property stocks of no more than purchase price of €203m. far more discerning in their
performance by property stocks is being driven 6%-8% over the next 12 months, given the Then in early March, Redefine PROPERTY individual stock selection.
by the ongoing search for yield, plenty of relatively strong performance already seen year made a bold move into Poland SA listed property index “There is no doubt that it is
All share index 114
wheeling and dealing on the corporate action to date. by acquiring a 75% stake in becoming increasingly
front and better-than-expected results. In fact, a Sesfikile Capital director Evan Jankelowitz Echo Prime Properties, which 111 difficult to predict property
number of counters have reported double-digit says in the company’s May newsletter that consists of 18 shopping centres 108 share price movements.’’
growth in dividend payouts for their respective property share prices may well have risen too and office blocks worth 105 Ndlovu notes that stock
interim and full-year reporting periods so far this much too soon. However, he says the sector still €1.2bn. picking has become even
102
year. offers an attractive relative yield in a world The deal marks one of SA’s more relevant in light of the
99
Top performers in terms of dividend growth “starved of yield” and still looks to grow that largest real estate transactions sector’s ongoing
include Fortress B (+101.2%), Hospitality B (+85%), yield quite comfortably. to date and will expand 96 diversification into foreign
Sirius Real Estate (+39%), Resilient Reit (+25.2%), In addition, Jankelowitz notes that the current Redefine’s offshore footprint 93 markets. Five years ago, less
Texton Property Fund (+15.3%), Hyprop risks facing the SA economy apply across the beyond that of the UK and 90
than 5% of the sector’s
board to all asset classes and that the growing Australia, where it owns J FMAM J J A S O N D J F M AMJ J A
earnings were generated from
TOP SIX REAL ESTATE income stream offered by property is significant stakes in Redefine 2015 2016 real estate owned beyond SA’s
Ranked by Name Net profit Rm Total assets Market cap Equity funds relatively appealing in comparison. International (30.1%) and Source: IRESS Share prices based to 100
borders. That figure has
net profit Rm Rm Rm Jankelowitz also refers to the ongoing drive Cromwell (25.6%). jumped to more than 36% and
among SA property players to diversify their Central and Eastern Europe (CEE) has also continues to rise as more local players expand
local portfolios beyond SA’s borders. He says become a popular port of call for other SA their property footprints offshore. Says Ndlovu:
1 Growthpioint Properties 5,364 103,823 69,715,594 63,793 management teams have been proactive in property players. While New Europe Property “Investors will have to start focusing a lot more
2 Resilient REIT 5,335 35,575 52,243,004 27,408 their diversification away from a pure SA Investments (Nepi) was for a long time the JSE’s on the geographic as well as sector exposure of
3 Intu Properties 4,877 231,133 89,151,079 110,61,596
exposure with efforts to increase offshore sole route to CEE real estate markets, sister fund the underlying assets of each individual stock,
5 Growthpoint Properties 3,476 81,986 68,920,434 49,428
6 Fortress Income Fund 2,547 20,741 17,590,617 14,262 portfolios. While this has resulted in headline Rockcastle followed suit early last year via and, more importantly, the track record of
growth in distributions holding up quite well, Poland where it has since assembled a portfolio management teams.’’
Source: McGregor BFA
he questions the sustainability of these of six shopping centres. Joan Muller

54 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 55
Financial Mail Page 56-57 -29/08/16 02:23:59 PM

✥ TOP PERFORMERS ✥ ✥ TOP PERFORMERS ✥

Tenacity pays off NOSA brand will benefit from this. The share these and other financial metrics.

INVESTMENT
INVESTMENT

price has tumbled in the past year, even though African Equity Empowerment Investments is
earnings growth has been strong. Micromega’s the rebranded Sekunjalo Investments Limited,
five-year IRR in its share price is just under 105%, with diversified holdings in sectors that include
its compound annual growth rate in earnings is food, fishing, tourism, health and technology. The

for smaller just over 35% and its ROE is just under 21%.
Small-cap industrial supplier and support
services conglomerate, Torre Industries has been
on an acquisitive streak, shopping for low
corporate finance division has been busy making
acquisitions, while management has been
mitigating against global uneasiness, reducing
debt and costs, and growing revenues. Everyone

companies valuation businesses in markets where trading


conditions are difficult, and then getting on with
the job of integrating them into
is highly focused on Vision 2020 which will
double the size of the business.
Viewing itself as a market

Martin Rhodes
the group. Like most industrial disruptor, it recently acquired a
peers, commodity prices, the small interest in multimanager
mining slowdown and currency Sygnia, run by the equally
Focusing on other revenue streams has helped the winner moves are just a few of its disruptive Magda Wierzycka.
challenges. AEEI is looking to spin off and
evolve and grow As part of its diversification separately list some of its
move into financial services, it investments, grooming those
launched a third-party credit which have been earmarked to
fund to attract external Dave make sure that ultimate listing

T
investors and to provide King unlocks value for stakeholders.
op Performers is that area of Top between product categories in the property financing to customers in AltX-listed Alaris Holdings
Companies that inevitably attracts the development market in order to maintain Africa externally from the was formerly Poynting Holdings
interest of speculators and those financial performance at acceptable levels. It group balance sheet. Limited, changing its name in
investors seeking potentially large certainly provided some bemusement when it Adapt IT Holdings develops 2015 after substantial
returns over a relatively short time announced a move into private memorial parks. software solutions for the reorganisation. It is now a much
frame. Often they are under-researched small Though government is expected to slow down its manufacturing, education, less complex group with two
capitalisation companies that , by definition, offer infrastructure spend, the housing component of energy and financial services main technology streams —
potential value to those investors prepared to do state expenditure will remain intact. sectors and is intent on taking defence and specialised
a lot of individual research. Calgro M3 considers itself well positioned to its offerings to the international antennas, with clients mainly in
Finbond Group is this year’s Top Performer, benefit in this regard, considering the huge markets and into all sectors. the Americas, Europe and Asia;
having moved up from seventh position last year. national shortfall of stock in the affordable The past few years have been seriously and digital television broadcast equipment, with
Finbond is focused on micro credit products and housing segments, both in terms of ownership concentrated on a strong acquisitive growth the client base here being SA and Africa.
investment/savings offerings, but has its eye on and rentals. Calgro’s five-year IRR in its share strategy that complements organic growth. Adding to this will be the COJOT acquisition, a
other revenue streams. It has now been dubbed price is 108%, while its earnings have grown at In the search for acquisitions, Adapt IT Finnish company which Alaris has been eyeing
as SA’s youngest retail bank as it embarks on a over 52% compounded over the past five years. management seeks like-minded entrepreneurial since 2012. COJOT designs and develops antennas
serious branch rollout across the country. Its latest ROE is a very impressive 25.1%. businesses that are profitable and enjoy strong and accessories for mobile tactical
The aim is to evolve its Finbond Mutual Bank Micromega stays at third position, the same as annuity income, where most of management communication, electronic warfare and spectrum
from short term micro lender into a mass-market last year. Chaired and controlled by Dave King want to remain after the acquisition, and whose monitoring applications. Alaris is set on
retail bank in SA. Across the Atlantic, its recent (who is also chairman of Glasgow Rangers staff enjoy a high performance culture. It is keen continuing its expansion into the European
capital-raising exercise will enable it to establish Football Club) Micromega’s services include to acquire operations in new technologies where markets and is very keen to secure a meaningful
a presence in the North American pay day information technology, financial, occupational it is not represented. Management boasts a strong footprint in the difficult US defence segment. Its
lending (short-term lending) market. The strategy health & safety and labour supply services. track record in acquisitions that have Aucom division is well positioned to participate
in this geography is through acquisitions and Its share price has had an interesting, volatile outperformed since being incorporated. in the African move to digital television and radio
subsequent organic growth. ride in recent years, with analysts commenting EOH is run by Asher Bohbot, one of the most services, as well as the growing number of
The main reason that Finbond finds itself at that its moves seem to be somewhat linked to the acclaimed CEOs in SA at present. Historically a private content providers, private TV companies
the top of the pile in Top Performers is its 131.5% personal controversies of King himself, with King South African-based ICT services group, it now and private broadcasters across the continent.
internal rate of return (IRR) in its share price over concurring with this sentiment. Current growth has its sights set on expansion, with first moves Rockcastle Global Real Estate is listed in SA
the past five years. Its latest return on equity comes from the IT segment, servicing local being into Africa and Middle East, recently and Mauritius, and is part of Resilient/Redefine. .
(ROE) of just over 8% is not impressive at all and authorities through software provision and announcing acquisitions in these territories. The It invests directly in Zambia and Eastern Europe,
neither is the fact that it doesn’t have a five-year revenue management solutions. group has quality earnings thanks to long-term as well as other listed property stocks, but is now
track record in earnings growth. These offerings will allow municipalities to contracts with built-in escalations, large client moving out of its smaller jurisdictions and
But where Finbond falls short, numbers two take control of their finances and reporting, and base and outstanding management. focusing on Eastern Europe. This model does not
and three-Calgro and Micromega-certainly don’t. ultimately improve service delivery. The group is Even a cursory glance at EOH’s historic appeal to everyone. Some analysts think
Last year’s number one, Calgro M3, drops intensely focused on growing earnings and cash, turnover, profit and earnings graphs cannot fail to management should focus on property
down to second position and is a mixed which is not easy to do simultaneously. impress investors and there are few listed development, and not property stock picking.
use/integrated residential property developer, Companies are increasingly paying attention companies that have been able to demonstrate Others, however, like this dual mandate. The
which prides itself on being able to switch to health & safety issues and the Micromega’s such a long-term sustainable growth pattern in tax-efficient Mauritian structure facilitates capital

56 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 57
Financial Mail Page 58-59 -29/08/16 02:24:42 PM

✥ TOP PERFORMERS ✥ ✥ TOP PERFORMERS ✥

raising for offshore development. institutional and retail fund management areas TOP PERFORMERS

INVESTMENT
INVESTMENT

Everyone is talking about the opening of has stood it in good stead since the markets Ranking Company IRR EPS Return on Return on Dividend Pretax profit
Starbucks in SA, thanks to franchise licence turned in March 2009. IRR 5 years to growth over equity over assets over yield 5-year growth over
holder Taste Holdings. The group has been But now that markets, globally, appear to have Mar 2016 5-year period 5-year period 5-year period average 7-year period
hectically busy, locally launching two of the run out of steam, Coronation’s allure has also
20 Conduit Capital 48.79 11.62 8.89 4.11 0.61 -1.39
world’s leading brands — Starbucks and flagged. The growth of assets under management
Domino’s Pizza — both within about a year. It and profitability have slowed compared with 21 Mr Price Group 46.29 17.03 57.99 30.95 3.29 15.54
has also acquired rights to Richemont luxury previous years. Add to the mix a certain amount 22 Enx Group 45.84 36.57 10.83 7.38 0.78 107.73
products such as Montblanc, RWC and Cartier, for of fund outflows and the result is not nearly as 23 Rand Merchant Inv Hldgs 45.83 15.62 9.26 6.75 4.53 38.33
its Arthur Kaplan jewellery stores. With these positive as it was a year ago.
24 Psg Group 45.64 21.70 6.80 4.63 1.64 18.25
brands secured, the focus becomes inward, Afrimat is a leading black-empowered
ensuring these opportunities deliver, considering open-pit mining company providing industrial 25 Super Group 45.59 90.52 15.25 10.15 N/A 20.21
the heavy capital investment required in the minerals and construction materials. It supplies a 26 Brait SE 45.27 96.20 59.55 54.71 1.45 147.13
rollouts. The group will now take a breather from range of construction materials and industrial 27 Curro Holdings 44.22 N/A 3.48 4.02 N/A N/A
further licence acquisitions. minerals, including mining and aggregates, 28 Howden Africa Holdings 43.84 31.11 34.73 20.40 2.77 25.93
Interestingly, the Starbucks brand cannot be metallurgical dolomites, agricultural lime,
29 Sabvest 43.06 23.80 14.76 13.75 1.38 23.01
sub-franchised down the line, so all SA stores, for concrete products and readymix. The group has
the foreseeable future, will be corporate-owned, also established a strong foothold in contracting 30 Sibanye Gold 42.82 N/A 6.20 6.09 4.76 N/A
as the Starbucks global philosophy is to minimise services like drilling and blasting. 31 Onelogix Group 42.10 N/A 1.29 3.64 1.44 -12.67
interventions between the customer and the The group’s growing geographical footprint 32 Capital & Counties Properties Plc 41.95 -5.63 -13.89 -8.88 0.49 -25.16
ultimate owner of the brand. This, however, covers vast sections of urban and rural southern 33 Resilient Reit 40.29 64.79 19.47 16.90 4.86 68.02
comes at a heavy cost and already one pivotal Africa, supported by the fleet of mobile crushers
34 Mondi Plc 39.94 25.74 20.10 12.33 3.50 20.84
shareholder - Brimstone - has disposed of its which offers flexibility beyond fixed areas of
shareholding in Taste as it feels that further rights operation. The group’s capabilities enable Afrimat 35 Vukile Property Fund 38.99 8.47 10.40 9.02 7.24 N/A
issues to finance the Starbucks and Domino’s to service projects of any scale from major 36 Interwaste Holdings 37.65 N/A 11.10 9.00 N/A N/A
expansion could be in the offing. infrastructure and construction projects for 37 Workforce Holdings 37.32 30.95 22.58 15.78 0.57 23.00
Coronation has been a regular entrant in Top state-owned enterprises and parastatals through 38 Woolworths Holdings 37.02 11.46 33.41 22.37 3.67 17.01
Performers and has been an overall winner of to small private sector contracts.
39 Discovery 37.01 24.48 22.34 8.33 1.79 21.43
Top Companies three times. Its focus on both the Staff writer
40 Mondi 36.75 25.74 20.10 12.33 3.50 20.84
41 Zeder Investments 36.52 3.08 1.90 2.68 1.22 9.84
TOP PERFORMERS 42 Sephaku Holdings 36.10 N/A 9.35 10.72 N/A N/A
Ranking Company IRR EPS Return on Return on Dividend Pretax profit 43 Mpact 36.08 46.45 17.87 11.76 2.05 36.02
IRR 5 years to growth over equity over assets over yield 5-year growth over 44 Pioneer Food Group 35.73 10.33 19.92 12.98 1.73 10.99
Mar 2016 5-year period 5-year period 5-year period average 7-year period 45 Capitec Bank Holdings 35.64 23.89 24.75 9.35 2.61 30.59
1 Finbond Group 131.53 N/A 8.02 8.58 0.38 N/A
46 London Finance & Investment Group Plc 35.13 27.17 12.38 11.30 3.54 12.60
2 Calgro M3 Holdings 107.59 52.04 25.11 12.82 N/A 60.88
47 Trustco Group Holdings 35.12 15.25 16.01 13.25 3.23 14.49
3 Micromega Holdings 104.96 35.32 20.78 27.24 0.77 36.18
48 Niveus Investments 34.75 N/A 5.31 4.13 1.09 N/A
4 Torre Industries 97.36 N/A 6.21 9.10 0.54 N/A
49 Master Drilling Group 34.63 N/A 19.60 14.09 N/A N/A
5 Adaptit Holdings 90.34 32.24 20.00 38.40 2.56 34.21
50 Famous Brands 34.49 14.05 38.96 57.12 3.57 14.80
6 Eoh Holdings 74.68 24.01 21.32 17.29 1.63 31.10
51 AVI 34.23 10.97 37.89 20.69 5.69 10.29
7 African Equity Empowerment Investments 69.57 34.79 19.56 21.08 0.76 33.42
52 Steinhoff International Holdings NV 34.18 8.75 4.87 7.05 1.64 19.16
8 Alaris Holdings 67.98 35.73 28.57 22.61 N/A 35.36
53 Firstrand 33.97 15.81 26.06 5.44 4.25 10.16
9 Rockcastle Global Real Estate Company 66.14 N/A 6.01 2.53 4.16 N/A
54 Sanlam 33.31 12.38 -1.34 0.23 4.21 12.28
10 Taste Holdings 62.40 -8.67 3.87 5.49 2.47 1.31
55 Italtile 32.95 15.66 26.95 23.55 2.47 15.77
11 Coronation Fund Managers 62.18 21.81 158.38 2.69 6.91 21.25
56 Life Healthcare Group Holdings 32.81 8.53 42.68 20.29 3.60 7.30
12 Afrimat 55.71 20.53 18.39 15.28 3.60 20.47
57 Oceana Group 32.41 12.00 17.16 13.18 4.94 10.85
13 Kaydav Group 53.15 33.11 19.38 11.21 N/A 38.32
58 Netcare 31.98 8.27 22.38 12.13 2.95 12.59
14 Indequity Group 51.27 15.16 29.26 22.32 1.84 14.86
59 Rmb Holdings 31.40 11.55 7.96 7.69 4.86 1.99
15 Csg Holdings 51.16 21.17 25.53 25.57 1.79 42.67
60 Consolidated Infrastructure Group 31.36 17.04 11.88 8.96 N/A 19.13
16 New Europe Property Investments Plc 50.91 15.58 5.00 4.08 4.77 54.65
61 Mix Telematics 31.24 10.95 8.70 11.76 2.52 6.87
17 Santova 50.17 94.98 14.31 8.31 0.66 15.49
62 Cognition Holdings 30.91 5.06 22.16 20.48 5.89 5.62
18 Naspers 50.02 9.76 1.79 2.03 0.55 14.17
63 Transaction Capital 30.79 1.45 18.15 12.14 2.22 2.35
19 Aspen Pharmacare Holdings 49.67 17.19 17.73 20.82 0.13 16.78
64 Spur Corporation 30.65 9.36 18.99 23.60 4.28 11.94

58 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 59
Financial Mail Page 60-61 -29/08/16 02:25:19 PM

✥ TOP PERFORMERS ✥ ✥ TOP PERFORMERS ✥

TOP PERFORMERS TOP PERFORMERS

INVESTMENT
INVESTMENT

Ranking Company IRR EPS Return on Return on Dividend Pretax profit Ranking Company IRR EPS Return on Return on Dividend Pretax profit
IRR 5 years to growth over equity over assets over yield 5-year growth over IRR 5 years to growth over equity over assets over yield 5-year growth over
Mar 2016 5-year period 5-year period 5-year period average 7-year period Mar 2016 5-year period 5-year period 5-year period average 7-year period
65 Cullinan Holdings 30.13 17.79 6.91 3.57 0.81 25.12 110 Vodacom Group 20.80 5.58 77.41 24.22 6.53 4.22
66 Peregrine Holdings 30.09 15.48 24.46 5.58 6.14 12.84 111 Clientele 20.77 12.12 82.94 13.90 5.62 10.91
67 Net 1 Ueps Technologies Inc 30.07 125.96 18.67 8.93 N/A 50.56 112 Investec 20.52 8.65 12.04 3.48 3.38 14.74
68 SABMiller Plc 29.41 19.55 12.66 17.36 2.19 16.41 113 Pan African Resources Plc 19.95 -2.07 3.58 4.12 4.33 -5.45
69 Old Mutual Plc 28.94 12.40 10.86 2.04 5.77 22.20 114 Redefine Properties 19.93 3.39 8.10 8.48 8.31 N/A
70 Tradehold 28.67 N/A 3.67 3.72 2.32 41.93 115 Mustek 19.68 6.94 15.58 6.66 3.59 9.46
71 Cashbuild 28.30 17.98 29.48 12.40 3.55 9.86 116 Sycom Property Fund 19.46 12.44 5.33 5.81 7.48 5.76
72 Metrofile Holdings 28.14 10.11 22.02 20.38 2.73 10.95 117 Trencor 19.37 10.25 10.99 5.71 5.36 21.29
73 Metair Investments 28.10 -0.97 12.98 9.65 2.81 11.28 118 Hosken Consolidated Investments 19.21 10.73 23.48 18.29 0.84 21.93
74 Liberty Holdings 28.06 9.48 13.31 0.99 4.19 1.95 119 Rolfes Holdings 19.09 3.19 13.71 10.99 2.04 9.45
75 Marshall Monteagle Plc 27.73 -0.63 3.31 4.04 4.04 6.08 120 Ecsponent 18.92 N/A 19.12 8.08 N/A N/A
76 British American Tobacco Plc 27.49 15.71 15.31 10.68 3.89 12.35 121 Texton Property Fund 18.70 37.56 6.67 5.64 6.87 N/A
77 Remgro 27.39 7.52 6.50 6.20 2.11 4.40 122 JSE 18.66 12.78 36.37 7.41 4.13 10.12
78 Trematon Capital Investments 27.27 29.29 5.40 6.32 1.04 21.56 123 Growthpoint Properties 18.49 7.39 8.41 8.09 6.59 N/A
79 Compagnie Financiere Richemont SA 27.02 11.29 13.65 9.57 17.03 18.30 124 Tsogo Sun Holdings 17.96 10.61 21.63 14.42 3.05 8.79
80 KAP Industrial Holdings 26.96 10.23 12.87 10.69 2.08 48.44 125 Tiger Brands 17.79 2.54 22.42 13.83 3.23 3.23
81 Grand Parade InvestmentS 26.91 -11.28 27.60 21.55 2.99 N/A 126 Amalgamated Electronic Corporation 17.72 N/A 8.33 13.76 4.77 -9.07
82 Omnia Holdings 26.21 12.84 17.67 12.43 2.12 18.28 127 Nedbank Group 17.69 N/A 14.82 5.20 N/A 9.20
83 Hyprop Investments 25.80 6.00 6.57 6.55 5.89 28.01 128 SA Corporate Real Estate Fund 17.66 6.09 9.00 7.91 8.31 15.21
84 Comair 25.51 24.68 27.87 11.13 1.76 26.58 129 Ascension Prop 17.60 N/A 3.71 8.80 5.08 N/A
85 MMI Holdings 25.43 7.25 12.52 0.97 7.71 14.89 130 MTN Group 17.34 15.09 23.12 18.52 5.00 8.77
86 Capevin Holdings 25.20 N/A 3.98 3.93 2.09 N/A 131 Imperial Holdings 17.09 3.46 18.58 8.89 4.15 5.62
87 Invicta Holdings 25.07 7.95 17.93 11.10 8.84 12.17 132 Phumelela Gaming and Leisure 16.98 7.07 22.37 13.54 6.14 0.84
88 Wescoal Holdings 24.90 N/A 2.52 2.99 1.07 N/A 133 AdvTech 16.94 2.16 21.38 11.04 3.12 3.43
89 The Bidvest Group 24.23 10.21 16.99 10.44 3.19 9.56 134 Cargo Carriers 16.77 26.18 8.70 7.71 2.05 24.44
90 Fairvest Property Holdings 24.07 N/A 3.35 7.08 8.92 N/A 135 Synergy Inc Fund 16.45 N/A -10.37 5.40 5.97 N/A
91 The Foschini Group 23.91 4.30 25.07 15.46 4.33 5.37 136 Investec Property Fund 16.33 N/A 8.76 7.82 7.32 N/A
92 Distell Group 23.86 6.60 14.66 10.47 2.89 6.03 137 Spanjaard 16.12 N/A -8.97 -4.01 5.09 N/A
93 Elb Group 23.86 3.45 14.82 8.12 2.67 8.35 138 Clover Industries 15.83 8.81 12.22 8.29 2.56 5.26
94 African Media Entertainment 23.67 14.57 29.37 21.73 2.50 13.83 139 Standard Bank Group 15.73 8.02 11.83 3.10 4.15 7.81
95 Brimstone Investment Corporation 23.62 N/A -19.78 -4.20 2.62 N/A 140 Datatec 15.67 21.41 9.99 4.49 N/A 18.85
96 Clicks Group 23.00 9.80 68.51 15.15 2.21 8.85 141 E-Media Holdings 15.63 N/A 4.72 18.05 N/A 106.84
97 Arb Holdings 22.51 10.32 16.08 13.83 4.61 11.17 142 Octodec Investments 15.53 N/A 7.98 7.81 7.20 N/A
98 Crookes Brothers 22.39 10.15 5.40 5.19 3.88 17.37 143 CAFCA 15.02 18.87 10.24 8.35 N/A 17.95
99 Delta Africa Property Holdings 22.21 N/A 3.25 2.94 4.01 N/A 144 Fortress Income Fund 14.75 12.59 17.86 16.02 9.06 112.10
100 MAS Real Estate Inc 21.98 44.43 6.03 5.63 2.70 75.30 145 Sasfin Holdings 14.50 13.80 13.34 5.50 4.14 9.87
101 AH-VEST 21.79 N/A 18.79 5.13 N/A 29.39 146 Huge Group 14.42 N/A 6.97 19.81 0.38 N/A
102 Telkom Sa Soc 21.78 12.81 13.80 10.27 2.34 1.52 147 Shoprite Holdings 14.21 8.77 27.90 12.42 2.24 10.78
103 City Lodge Hotels 21.57 19.69 41.96 17.27 3.19 12.59 148 Transpaco 14.19 2.60 17.83 11.50 5.26 3.63
104 The Spar Group 21.54 8.44 58.77 11.43 3.81 8.97 149 Intu Properties Plc 14.02 N/A 4.41 4.14 4.09 N/A
105 Ingenuity Property Investments 21.46 21.16 5.39 6.24 2.05 36.72 150 Emira Property Fund 13.82 14.54 10.87 9.58 8.46 14.07
106 Reinet Investments S.C.A 21.42 42.01 17.52 17.41 1.68 41.67 151 Rebosis Property Fund 13.63 N/A 1.80 5.18 7.30 N/A
107 Santam 21.23 8.68 26.88 8.30 4.96 11.11 152 PInnacle Holdings 13.50 9.22 19.07 11.52 1.37 5.57
108 Investec Plc 21.08 8.65 12.04 3.48 3.52 14.74 153 Hudaco Industries 13.48 2.58 22.97 18.40 4.78 8.49
109 NAMPAK LTD 21.06 0.68 16.51 8.56 4.53 -2.32 154 Barclays Africa Group 12.94 6.51 17.14 4.46 5.92 10.80

60 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 61
Financial Mail Page 62-63 -29/08/16 02:25:50 PM

✥ TOP PERFORMERS ✥ ✥ UNIT TRUSTS ✥

TOP PERFORMERS
Leader in advisers for the type of long-term investment

INVESTMENT
INVESTMENT

Ranking Company IRR EPS Return on Return on Dividend Pretax profit suitable for a pension fund. Balanced funds are
IRR 5 years to growth over equity over assets over yield 5-year growth over true one-stop shops, as they give a full spectrum
Mar 2016 5-year period 5-year period 5-year period average 7-year period
of domestic and international assets, whether
156
157
158
Eastern Platinum
Dipula Income Fund
Oasis Crescent Property Fund
12.35
12.27
12.18
N/A
N/A
2.06
-1.77
5.39
5.75
-4.78
8.07
5.60
N/A
11.53
6.71
N/A
N/A
6.42
investment equity, fixed income or property in one package.
Other best sellers are Foord Balanced (R49bn)
and Investec Opportunity (R40bn). A sub-group

trends
of the balanced fund is the stable fund, which is
159 Astral Foods 12.12 11.92 30.72 17.40 5.02 10.66
restricted to a maximum of 40% in equities. Best
160 Blue Label Telecoms 11.93 12.23 16.94 15.12 3.22 12.91 sellers in this category include Prudential
161 Tongaat Hulett 11.34 1.67 8.20 7.28 2.76 9.92 Inflation Plus (R348bn), Coronation Balanced
162
163
164
Sun International
Sovereign Food Investments
Holdsport
11.22
11.09
10.99
6.41
12.20
N/A
31.71
11.46
20.75
11.04
8.82
30.61
2.49
2.13
5.24
1.80
23.52
N/A
thus far Defensive (R39bn), Allan Gray Stable (38bn) and
Nedgroup Stable (R34bn).
For all the diversity of funds in SA, the
industry is highly concentrated, with 75% of
165 Insimbi Refractory & Alloy Supplies 10.74 23.64 20.20 10.00 5.13 15.49 assets held by 10 managers. This includes the
166 Value Group 9.99 -4.69 9.65 7.23 4.37 -7.63 exclusive club known as FICA - Foord, Investec,
167 Delta Property Fund 9.81 N/A 8.99 8.18 6.98 N/A Funds have been the great Coronation and Allan Gray - which has recently
been infiltrated by Prudential.
168 Caxton Ctp Publishers and Printers 9.57 0.49 8.66 7.02 3.30 -2.41 success story of the past Nedgroup with its successful “best of breed”
169 Imbalie Beauty 9.33 N/A -9.39 -4.96 N/A N/A
170 African and Overseas Enterprises 9.16 -13.19 9.03 7.74 N/A -17.56 five years model is also there. It has at least given a helping
hand to the second-tier fund managers, giving
171 Truworths International 9.10 5.42 37.25 29.38 4.37 3.79 mandates to firms such as Abax, Taquanta and

W
172 Randgold & Exploration Company 8.86 -28.90 84.20 77.06 24.72 -29.53 most recently Truffle. While the FICA club is
ith 1,360 funds, unit trusts have exclusively Cape Town-based, one of the trends
173 Combined Motor Holdings 8.80 11.82 34.02 10.91 4.73 7.91
more investment choices than in unit trusts and asset management in general
174 Adrenna Prop Group 8.78 N/A 2.60 4.61 N/A N/A there are shares on the JSE. It has been towards Johannesburg-based managers
175 Orion Real Estate 8.51 N/A 1.16 2.92 N/A N/A would be interesting to speculate such as 36One, Visio and Truffle.
176 Diamondcorp Plc 8.48 N/A -12.41 -4.63 N/A N/A what Louis Shill, the founder of Pieter Koekemoer, head of Coronation unit
177 Adcorp Holdings 8.25 8.81 16.14 14.82 5.03 15.28 the SA Growth Equity fund (Sage) in 1965, the first trusts, says that at least 25 credible single
fund in the industry, might have thought before managers have emerged over the past three years
178 Putprop 8.08 5.18 6.80 5.98 5.20 11.96
he passed away earlier this year. and there has been a broader acceptance of these
179 Barloworld 8.05 11.86 13.30 8.79 3.24 13.25 He would have been stunned at the scale of shops. “The long-term trend towards a
180 Tiso Blackstar Group SE 7.79 N/A 18.30 16.79 2.21 11.83 the industry, with R1,92 trillion under consolidated industry has been reversed since
181 Purple Group 7.71 54.40 13.79 9.23 0.42 43.72 management — about twice the total tax early 2015,” he says.
182 Global Asset Management 7.61 N/A 12.14 8.43 N/A N/A collected in the 2016 tax year by the SA Revenue He attributes this in part to the rise
Service. The public does not seem to be losing of discretionary fund managers, such
183 Hospitality Property Fund 7.53 -4.73 -0.36 7.61 10.60 N/A
confidence in the sector, as there were net as Analytics, Portfoliometrix,
184 Telemasters Holdings 7.47 -22.86 13.41 11.03 6.00 -23.74 inflows of R111bn over the past 12 months. Fundhouse and Morningstar
185 Sappi 7.46 N/A 16.92 7.51 N/A 47.32 Unit trusts aren’t all equity funds any longer; Investment Management.
186 Gooderson Leisure Corporation 7.11 24.57 3.30 3.88 2.44 27.66 in fact, equity funds account for just 21% of the “There isn’t much incentive for the
187 Trans Hex Group 6.76 N/A 12.84 10.51 3.69 N/A assets. But this needs to be supplemented with primary managers to work with DIMs
the 4% invested in real estate funds (which invest [designated investment managers],”
188 Lewis Group 6.60 2.48 14.05 11.30 6.85 1.48
in listed property shares), as well as the equity says Koekemoer, “and the DIMs need to
189 Hulamin 6.05 8.16 -0.68 0.59 0.98 -33.60 component of the multi-asset funds which is offer something different.”
190 Pick n Pay Holdings 5.67 1.40 51.37 8.33 2.75 0.67 about 50% or 26% of industry assets. Another reason for the
191 ISA Holdings 5.61 4.56 33.08 19.80 6.75 -1.29 Multi-asset, or balanced, funds have been the rise of new second-tier
192 Grindrod 5.32 -8.50 4.09 4.37 2.01 -2.43 great success story of the past five years, growing managers has been the
their share from 25% to 51%. Most of the big increase in white-label
193 Sasol 5.31 8.01 16.93 13.24 4.15 9.92
funds in the industry five years ago would have funds. It makes an
194 Reunert 4.73 -0.35 14.63 11.15 5.55 -1.36 been the large money market funds. Now only independent asset
195 Massmart Holdings 4.12 -2.12 26.43 6.72 3.13 -2.64 the Absa Money Market fund survives among the manager’s life much
196 Wilson Bayly Holmes-Ovcon 4.04 -3.66 15.14 5.25 2.88 -3.81 giants, with R55bn under management, which is easier, as the burden of
still rather more than the market cap of Gold running a unit trust
197 Silverbridge Holdings 3.93 23.17 26.74 24.81 0.62 N/A
Fields. management company
198 Wilderness Holdings 3.89 27.81 20.47 11.42 2.22 12.27 The two largest funds in the country are Allan can be passed on to
199 Pick n Pay Stores 3.66 1.46 40.95 8.34 2.43 0.67 Gray Balanced at R115bn and Coronation white-label shops such
200 ANSYS 2.99 N/A 37.13 11.68 N/A N/A Balanced Plus at R84bn. These two funds have as Boutique Collective
Source: McGregor BFA been the default choice for independent financial Investment and MetCI. Jeanette Marais
62 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 63
Financial Mail Page 64-65 -29/08/16 02:26:25 PM

✥ UNIT TRUSTS ✥ ✥ CORPORATE GOVERNANCE ✥

New

Jeremy Glyn
The fund has still done 7% year to date. It as suffering from hubris — “a loss of contact with

INVESTMENT
INVESTMENT

benefited from investing in equities offshore. reality and an overestimation of one’s own
Stanlib suffered a high net outflow of more competence, accomplishments or capabilities,
than R11bn in the second quarter of last year, especially when the person exhibiting it is in a
which Katakuzinos says was caused by a
rebalancing by parent company Liberty of their
investment in funds such as the bond fund into
measures position of power.”
The Myburgh commission also found that the
board had not exercised proper oversight of the

to rein in
segregated portfolios. Stanlib suffered as there has bank and Kirkinis’s activities. It emerged that the
been less interest in its best-selling fixed-income acquisition of Ellerines, a key factor in the
portfolios since the demise of Abil two years ago collapse of the bank, had received only the most
— it was then forced to write down the value of perfunctory approval from the board.
its Abil securities. It is finally selling many of
these as Abil gets back on its feet and client
confidence returns.
Most investors hold their unit trusts through
firms One director, Thami Sokutu (who has since
died), had a severe drinking problem and held
the title of chief risk officer for 10 years, though,
in effect, there was no chief risk officer as one
linked product platforms such as Glacier, Allan would understand that title in the banking
Gray Lisp and Old Mutual Wealth. In the first industry.

Anthony Katakuzinos
quarter there was an almost equal flow into Allan Good business practice has Again, this seemed to be a case of the board
Gray (R4.12bn) and Glacier (R4.08bn), between becoming a cheer-leader instead of a watchdog,
them taking almost half the flows into these emerged as a factor that cowed into submission by the charisma and
BCI alone has almost 280 funds, including
niche managers such as property specialists
platforms, and they account for a third of the
assets under management.
cannot be taken for granted undeniable previous success of Kirkinis, the
founder of the business.
Sesfikile and Africa-focused Rudiarius, upcoming Glacier, which is part of Sanlam, has R176.bn The cases of MTN and African Bank reminded

T
equity managers such as Visio and Anchor, under administration. But Old Mutual Wealth is us that however extensive the notional
financial advisers such as Point3 and Portfolio in third place with R159.1bn, and had the wo corporate stories that emerged in commitment to good governance, the decisive
Bureau, and DIMs such as Portfoliometrix. fourth-largest inflow of R1.7bn. Investec was third 2016 illustrated how difficult it can be to factor is the attitude and competence of the
BCI had the largest inflows in the March in net cash flows with R2.2bn. ensure that good governance prevails board. This was part of the context for the
quarter, of R4,8bn. MetCI was third with R2,3bn, The broader unit trust industry also consists of even at prominent listed companies. launching by the Institute of Directors (IoD) of the
while second placed Prescient, which has a large locally registered foreign portfolios, which MTN, a darling of the market since the proposed revised codes of good corporate
white-label component, brought in R4,5bn. But consists of 378 funds registered with the creation of the cell-phone industry in the 1990s, governance, known as King IV (the successor to
there is still a long way to go before the second Financial Services Board. There is R350bn experienced a serious dent in its reputation at the King III, published in 2009).
tier catches up. Allan Gray (R238bn) and invested in these funds from SA, and as the rand end of 2015, when it was fined US$5.2bn for not Rather than add yet more box-ticking
Coronation (R234bn) still dominate, with a strengthened from its lows there were net registering more than 5m of its subscribers in compliance activity to governance, King IV aims
quarter of the market between them. outflows of R4.7bn in the first quarter. Nigeria. to both simplify and strengthen the codes. King
Head of Allan Gray’s unit trust and platform Stephen Cranston At first it seemed the Nigerian authorities IV will not constitute a significant departure from
Jeanette Marais says the house had experienced were being unreasonable and capricious, but it the solid foundations and philosophy set by King
outflows in 2015, in part because of some then emerged that MTN had been repeatedly III, and organisations need not prepare for a host
disappointing short-term performance numbers, warned about the unregistered subscribers. of additional principles and practice
but when performance turned in November, Eight months later, after much debilitating recommendations. To the contrary, in the draft of
investors came back within a month. “This was uncertainty and the slashing of the market value King IV the number of principles are reduced
unusual, as it can take up to nine months to of the company, the fine was reduced to about a from the 75 principles in King III to a mere 16.
restore confidence.” Allan Gray had positive flows third of the original amount, to be paid over three Ansie Ramalho, who has been driving the
of R1,9bn in the first quarter. years. project for the IoD, notes that “the principles and
Marais says there has been interest in Questions have been asked, and not yet outcomes in King IV are meant to depict intent,
second-tier managers, some of which have been answered, about what knowledge the MTN board so that organisations and those charged with
voted onto the Allan Gray platform by financial had of this issue, and why such a huge risk to the their governance are able to adapt practices”. This
advisers. They include 360ne, Truffle and PSG. It company’s reputation and financial performance way the emphasis shifts from a compliance
has also encouraged the passive fund option by had not been perceived and addressed. mind-set to corporate governance that achieves
offering the Nedgroup Core Guarded and Core Pieter Phuthuma Nhleko, as the former CEO and hastily the intended outcomes and benefits.
Diversified funds. Even the life office-owned Koekemoer appointed executive chairman, oversaw the “Good corporate governance ensures that the
funds could be in for a chance, as the first Old tortuous resolution of the issue of the Nigerian necessary arrangements are in place so that those
Mutual fund, Old Mutual Global Equity, was fine, but it also had to be asked what he had been charged with governance duties are poised to
voted onto the platform. doing previously about Nigeria when he was capture new opportunities and are more resilient
However, the Stanlib Balanced fund was also non-executive chairman. to face risks in an ever more complex and
recently voted off. Head of Stanlib Retail Anthony African Bank had announced appalling losses unpredictable environment. Seeing corporate
Katakuzinos says that fund manager Robin Eagar in August 2014 and was put into curatorship. governance in this light, it is not a barrier to
has been more conservative than his peers, Advocate John Myburgh’s report on the failure of enterprise but the way to successful enterprise.”
believing that as markets are expensive, cash the bank was released by the Reserve Bank in
offers a similar prospective return at far less risk. May this year. Myburgh described CEO Kirkinis David Williams

64 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 65
Financial Mail Page 66-67 -29/08/16 02:26:53 PM

✥ LEGAL ADVISERS ✥
✥ LEGAL ADVISERS ✥

Time to charge Webber Wentzel to develop an app specifically to “Already, tasks like document review and legal

SERVICES
SERVICES

enable the firm's clients to access vital discovery [the production of documents in
information quickly and stay on top of the latest advance of trial hearings], which were previously
legal news and emerging issues, regardless of undertaken by legal teams at huge time and
where they are or what device they are using. expense by numerous lawyers and paralegals,

by the second? It features relevant legislation, case law and


content supplied by Webber Wentzel, including
articles, presentations, seminar notes and case
summaries, says LexisNexis.
But as technology attempts to streamline the
have become highly automated,” he says.
“Software algorithms can be programmed to
identify patterns, relationships and relevance in
huge amounts of information with greater
accuracy and speed than document review by a
business of practising the law, some concern mere mortal lawyer and at a significantly
A digitised legal system would save money and provide remains on how it could impact the livelihood of reduced cost.”
its practitioners in the long run. The world’s first artificially intelligent lawyer
better public access to laws of the land Darryl Bernstein, Partner at Baker & has already been deployed in US law firms.
McKenzie, says the increasing development of ROSS, a digital legal expert, is built on the back of
artificial intelligence and the ability of software to an IBM super computer and is capable of
replicate sophisticated tasks “has all of us performing legal research and responding to

I
wondering when our jobs, previously the proud questions in plain English, with referenced
n SA only the Constitutional Court has a “Anything that you can do to reduce the domain of experienced and highly trained answers and citations from legislation, case law
digital central document database with an burden of these areas will improve the efficiency professionals, will be capable of simple and other sources.
array of automated features, available to be of your law firm. This in turn will increase replication by complex systems. Ruan Jooste
accessed by the legal fraternity. profitability or allow the law firm to compete
The rest of the judicial system is still entirely more aggressively on price. Either way, that is
paper-based, which is probably one of the good news for the business,” he says. LEGAL ADVISERS AND CORPORATE CLIENTS
reasons the justice system is not as efficient as it Legal services involve a large amount of
■ ABSA LEGAL SERVICES ■ BOTOULAS KRAUSE & DA Top Performers: AEEI (7),
could be, and a great indicator that the justice back-and-forth communication, that can be SA Giants: B-Africa (19) SILVA INC Conduit (20), Steinhoff (52),
system might be ripe for digital disruption. highly complex and hard to track, says Dinnie. Top Performers: B-Africa SA Giants: EOH (87) LifeHC (56), Net1UEPS (67),
“Documents go missing or are misplaced, law “There is agreat opportunity to streamline the (154) Top Performers: EOH (6) Metair (73), Remgro (77),
clerks have to stand in long lines at state process for your clients to create a better ■ ADAMS & ADAMS ■ BOWMAN GILFILLAN INC Richmont (79), Omnia (82),
SA Giants: Woolies (31), SA Giants: Stanbank (13), Brimston (95), VPIF (121),
institutions to access information. Going through experience.” Ascen (129), Rebosis (151),
Trustco (203) Datatec (22), Barworld (28),
pages and pages of documents manually comes Norton Rose Fulbright SA and Gladi8, a fintech Top Performers: Woolies Tongaat (64), Clover (90), Sunint (162), Holdsport (164),
at a cost,” says Donald Dinnie, MD-elect of company, has developed an innovative (38), Trustco (47) ARM (91), Value (147), Massmart (195), WBHO (196),
Rebosis (192), Trnshex (198), DAWN (204), Converge (217),
Norton Rose Fulbright SA. know-your-client tool called DocFox - a secure ■ APPLEBY (BERMUDA) LTD Primeserv (231), Petmin
SA Giants: Pallinght (316) Osiris (255), Freedom (285)
He took over the reins from Rob Otty at the and compliant online portal which collects, Top Performers: Osiris (99), (256), Aveng (265), Sentula
Top Performers: Pallinght (287), Psg-kst (317)
beginning of July. Otty was appointed to the verifies and stores clients' documents. “It is (227) Clover (138), Stanbank (139),
newly created, global position of Managing specially designed to assist clients with Fica Datatec (140), Rebosis (151), ■ COERTZEN WILLIAMS
■ BAKER & MCKENZIE Tongaat (161), Value (166), ATTORNEYS
Partner, Business Integration, where he will focus documentation and simplify their lives,” says SA Giants: Bidvest (8), Barworld (179), Trnshex SA Giants: Calgro (200)
on global integration and transformation projects, Dinnie. The service offering will be launching Aveng (35), Adcorp (74), (187), ARM (251), Freedom Top Performers: Calgro (2)
Indlu (261) (293)
which includes digital ambitions. He has soon. Top Performers: Bidvest ■ COGHLAN WELSH & GUEST
relocated to the London office. The law firm has also created (89), Adcorp (177), Aveng ■ BRIAN KAHN INC (ZIMBABWE)
Many industry players agree that a digitised innovative tools like ContractorCheck (265), Indlu (297)) SA Giants: S Ocean (157) SA Giants: Cafca (239)
Top Performers: S Ocean Top Performers: Cafca (143)
legal system would allow better access for to help organisations accurately ■ BARNARD INC (257)
SA Giants: Calgro (200) ■ COLLINS NEWMAN & CO
ordinary citizens to the laws of the land, and free characterise an individual’s ■ C & A LAW (MAURITIUS) (BOTSWANA)
Top Performers: Calgro (2)
up a lot of resources to actually enforce them, contractor or employee status; as ■ BERKOWITZ COHEN SA Giants: Rockcastle (290), SA Giants: Choppies (102),
rather than sustaining the abundance of civil well as an online resource, Atleaf (308) Wildrness (186)
WARTSKI Top Performers: Rockcastle Top Performers: Wildrness
servant paper pushers. Protection of Personal Information SA Giants: Gooderson (269) (9), Atleaf (303)
Top Performers: Gooderson (198), Choppies (299)
From a law firm perspective, manpower could Act (POPI) Counsel, which is a ■ CLIFFE DEKKER HOFMEYR ■ COMNINOS INC
(186)
be better spent on more productive and lucrative concise, easy-to-understand portal of INC SA Giants: Insimbi (196))
■ BERNADT VUKIC POTASH & SA Giants: Richmont (11), Top Performers: Insimbi (165)
practices, which could bring cost savings to the information necessary for GETZ ATTORNEYS
client. complying with POPI. Steinhoff (12), Massmart ■ COREUS (FRANKFURT)
SA Giants: Mr Price (60), (20), Aveng (35), WBHO (46),
While the state is struggling to adapt to the The organisation also Invicta (86), Spurcorp (216), SA Giants: Steinhoff (12)
Remgro (50), Omnia (62), Top Performers: Steinhoff
digital age, legal firms across the country have offers a comprehensive Trematon (276) LifeHC (70), Sunint (82),
Top Performers: Mr Price (52)
been quite innovative within themselves to make online legal compliance Net1UEPS (97), Metair (100),
(21), Spurcorp (64), DAWN (114), Brimston (152), ■ COUZYNS INC
practising law more efficient and cost-effective. training tool for business Trematon (78), Invicta (87) Holdsport (164), Sentula SA Giants: Omnia (62),
The law involves a large amount of complex called ComplianceWorld. ■ BERWIN LEIGHTON (172), Petmin (178), Rebosis Arrow (210), Indlu (261))
PAISNER LLP (192), Conduit (197), Arrow Top Performers: Omnia (82),
and detailed work, as well a lot of research that Earlier this year it was Donald Indlu (297)
Dinnie SA Giants: Stenprop (241), (210), Psg-kst (212), AEEI
takes considerable effort and time, Dinnie says. announced that Sacoven (313) (222), Primeserv (224), ■ COX YEATS ATTORNEYS
There are also large amounts of documentation LexisNexis SA had Top Performers: Stenprop Ascen (236), VPIF (237), SA Giants: Tongaat (64)
and compliance involved. teamed up with law firm (309), Sacoven (311) Converge (250) Top Performers: Tongaat

66 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 67
Financial Mail Page 68-69 -29/08/16 02:27:16 PM

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LEGAL ADVISERS AND CORPORATE CLIENTS


Growing With the growing demand for faster execution

SERVICES
SERVICES

speeds and exchanges’ need to offer these in


(161) MORRISON INC SA Giants: Steinhoff (12),
SA Giants: Accent (243) Capco (139) order to compete, the JSE launched its colocation
■ DEREK H RABIN &
Top Performers: Accent (216) Top Performers: Capco (32), centre in 2014, allowing its clients to place their

demand
ASSOCIATES
SA Giants: Itltile (127) ■ GANADO ADVOCATES Steinhoff (52) trading equipment in the JSE data centre and
Top Performers: Itltile (55) SA Giants: Blackstar (324) ■ LIVINGSTON LEANDY INC offering the fastest access to all JSE markets.
■ DI SIENA ATTORNEYS Top Performers: Blackstar SA Giants: Santova (123), “The colocation centre provides clients with
SA Giants: Micromega (191) ■ GARLICKE & BOUSFIELD Crookes (229)

for faster
Top Performers: Santova (17), the lowest latency connectivity for trading and
Top Performers: Micromega INC
SA Giants: Spar (23), Crookes (98) the receipt of real-time data,” says Oosthuyse.
■ ENSAFRICA (EDWARD
NATHAN SONNENBERGS) Tongaat (64), Adaptit (228)) ■ M PARTNERS S.A.R.L “Colocation provides them with a roundtrip
SA Giants: Bidvest (8), Top Performers: Adaptit (5), SA Giants: MAS (266), Brait latency of 150 microseconds, compared to the
Spar (104), Tongaat (161) (309)

trading
Massmart (20), Picknpay previous 2550 microseconds it took for clients
(25), Pikwik (26), Woolies ■ GIDE LOYRETTE NOUEL Top Performers: Brait (26),
(31), Tigbrands (42), A.A.R.P.I. (PARIS) MAS (100) who were based in Sandton.”
Discovery (48), Distell (58), SA Giants: Steinhoff (12) ■ MACROBERT INC Aside from speedier trading and updates to
Foschni (66), Grindrod (72), Top Performers: Steinhoff SA Giants: Finbond (263) market data, which allow enhanced responses to
HCI (76), Truwths (78), ■ GILDENHUYS MALATJI INC Top Performers: Finbond (1))
Trencor (96), Oceana (107), movements and deployment of new trading
SA Giants: Itltile (131) ■ MALAN SCHOLES
Bell (109), Lewis (118), Top Performers: Itltile (65) ATTORNEYS strategies, colocation also reduced bandwidth
E-media-n (119), Brimston
(152), York (165), Sentula ■ OGILVYONE WORLDWIDE SA Giants: Diamondcp (304) Local competition will be costs for clients, she says. “It also reduced clients’
SA Giants: Silverb (280) Top Performers: Diamondcp dependence on network providers.”
(172), Cityldg (176), Transcap
(185), Rolfes (188), Insimbi Top Performers: Silverb (197) ■ MARDEMOOTOO raised a notch with new Colocation opened a new revenue stream for
■ GIRARD HAYWARD INC SOLICITORS
(196), enX (205), AEEI (222),
Hosp (234), Sasfin (312), SA Giants: York (165) SA Giants: Frontier (262) exchange the JSE, because latency speeds offered compare
favourably with other international destinations.
Sabvest (314), Pallinght Top Performers: York (238)) Top Performers: Frontier
■ MARTINI & PATLANSKY “Faster trading has measurable beneficial

A
(316), Nedbank (318), ■ GLYN MARAIS INC
Blackstar (324) SA Giants: Growpnt (99), ATTORNEYS impacts on a variety of core market quality
Top Performers: AEEI (7), Novus (120), Andulela (187), SA Giants: AME (248) midst a wave of disruption unleashed metrics, including tighter spreads, increased
enX (22), Sabvest (29), Verimark (235), VPIF (237), Top Performers: AME (94)
by regulation, technology and liquidity and more efficient price formation. Our
Woolies (38), Discovery (39), Invltd (321), Invplc (322) ■ MAWERE & SIBANDA LEGAL
Oceana (57), Transcap (63), Top Performers: Invplc (108), PRACTITIONERS competition, the world of securities systems are robust and we have excellent
Bidvest (89), Foschni (91), Invltd (112), VPIF (121), (ZIMBABWE) exchanges has become more complex, surveillance capabilities,” says Oosthuyse.
Distell (92), Brimston (95), Growpnt (123), Verimark SA Giants: Hwange (213) with continuous developments driving In an unrelated advance, in July the JSE went
Cityldg (103), Trencor (117), (259), Andulela (276), Novus Top Performers: Hwange
HCI (118), Rolfes (119), trends like algorithmic trading, low latency and live with another project to reduce its securities
■ HOGAN LOVELLS ■ MCPHERSON KRUGER
Tigbrands (125), Nedbank SA Giants: Itltile (127), co-locations. settlement cycle from five to three days, in line
(127), E-media-n (141), Sasfin
ATTORNEYS
Trustco (203) SA Giants: Dcentrix (138) Speed of execution is now the name of the with global standards. Leila Fourie, executive
(145), Insimbi (165), Truwths Top Performers: Trustco
(171), Blackstar (180), Hosp
Top Performers: Dcentrix game, says Donna Oosthuyse, director of capital director of post-trade and information at the JSE,
(47), Itltile (55) ■ MICHAEL KRAWITZ & CO markets at the JSE, as the profitability of the core says the T+3 project was first conceived over a
(183), Lewis (188), Pikwik,
Grindrod, Massmart, ■ HOWES INC SA Giants: Af & Ovr (230), business, matching buyers and sellers, declines. decade ago, but was put on hold due to other
Picknpay (199), Pallinght SA Giants: Trustco (203) Rex True (231)
Top Performers: Trustco (47) Top Performers: Af & Ovr “The days of high barriers of entry where technology implementations and priorities.
(227), Bell, York, Sentula
■ HUTCHEON ATTORNEYS (170), Rex True (206) exchanges could shield themselves from The T+3 project was re-established in 2013 and
■ EOH LEGAL SERVICES
SA Giants: Exxaro (63) SA Giants: Adrenna (291) ■ MILBANK TWEED HADLEY competition are over,” she says. “As soon as that the first two phases have been successfully
Top Performers: Exxaro Top Performers: Adrenna & MCCLOY LLP was undermined, we all became vulnerable. Now implemented. The final phase went live on July
■ EVERSHEDS ■ JAVA CAPITAL (PTY) LTD SA Giants: Steinhoff (12) the race for speed and low latency has become 11, when the SA markets switched over to a
SA Giants: Workforce (156), SA Giants: BlueTel (55), Top Performers: Steinhoff
Redefine (105), Hyprop (132), ■ MKHABELA HUNTLEY the competitive advantage,” she says. three-day settlement cycle.
Taste (218)
Top Performers: Taste (10), Mixtel (170), Onelogix (171), ADEKEYE INC High-frequency traders use sophisticated Says Fourie: “This landmark change will allow
Workforce (37) Redefintl (180), Arrow (210), SA Giants: Wesizwe (325) computer programs to execute thousands of for the release of cash two days earlier, increasing
Kaydav (215), Efficient (220), ■ Top Performers■ Wesizwe
■ FALCON & HUME INC Dipula (227), Sableplat (317) trades in fractions of seconds using specific the funds in circulation and reduce systemic risk
SA Giants: SRockwell (223) Top Performers: Kaydav (13), ■ MOURANT OZANNES algorithms. According to the JSE, algorithmic where at any point in time, in the case of a
Top Performers: Rockwell Onelogix (31), Mixtel (61), SA Giants: Pallinght (316) trading already constitutes a large share of default, market participants would potentially
■ FARBER SABELO Hyprop (83), Redefine (114), Top Performers: Pergrin (95)
activity on the local equity market, and is likely face three days of unsettled trades rather than
EDELSTEIN Dipula (157), BlueTel (160), ■ NORTON ROSE FULBRIGHT
SA Giants: Growpnt (99) Sableplat , Efficient, SOUTH AFRICA to increase over time. five days.”
Top Performers: Growpnt Redefintl SA Giants: Kumba (33), In this context, latency refers to the amount of Local competition will be upped a notch when
■ FASKEN MARTINEAU ■ JONES DAY Aveng (35), Omnia (62), ARM time it takes for market information to reach a the ZAR X Stock Exchange launches this year. It
SOUTH AFRICA SA Giants: ResGen (311) (91), Growpnt (99), Assore
(136), Huge (256), Labat trader’s computer; for him/her to respond to that has the potential to drive down execution cost for
SA Giants: AImplats (41) Top Performers: ResGen
Top Performers: Implats (295), Sacoil (298) information; and for the order to be received by traders over the long term. The JSE has
■ KEITH SUTCLIFFE & Top Performers: Omnia (82),
■ FLUXMANS INC ASSOCIATES INC an exchange. Low latency technology is what welcomed the introduction of another exchange
SA Giants: Suprgrp (57), Growpnt (123), Huge (146), enables high-frequency traders to place their to the market, however. Oosthuyse says that cost
SA Giants: Trustco (203) Assore (235), ARM (251),
Caxton (106), Winhold (181), Top Performers: Trustco (47) orders at unfathomably fast speeds. savings brought on by the introduction of other
Invprop (207), AME (248) Kumba (253), Labat (261),
■ KLAGSBRUN EDELSTEIN Aveng (265), Sacoil (281) “High-frequency traders combine algorithmic players to the market can easily be offset by the
Top Performers: Suprgrp BOSMAN DE VRIES INC
(25), AME (94), Invprop ■ PAGDENS INC trading with high-speed data connections to costs of procuring data, analysis and connectivity.
SA Giants: Ansys (249) SA Giants: Sovfood (160)
(136), Caxton (168), Winhold make their lightning-fast order submissions, and “A lot of work still needs to be done,” she says.
■ LINKLATERS LLP Top Performers: Sovfood
■ FULLARD MAYER cancellations or modifications,” says Oosthuyse. Ruan Jooste

68 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 69
Financial Mail Page 70-71 -29/08/16 02:44:08 PM

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■ ABSA CAPITAL (A DIV OF Mustek (113), DAWN (114), Phumelela, Invprop, (138), Workforce (156), (232), York (238), Atlatsa Delta, Converge, RMBH,

SERVICES
SERVICES

ABSA BANK LTD) Pergrin (149), Primeserv E-media-n, Trnpaco, BlueTel , Micromega (191), Conduit (274) CapevinH, Brait, Sabvest,
SA Giants: Glencore (1) (224), Purple (267), ResGen Tongaat, Value, Pikwik, (197), Taste (218), Adaptit ■ PSG CAPITAL (PTY) LTD Reinet
Top Performers: Glencore (311) WBHO, Picknpay, Raubex , (228), PSV (247), Amecor SA Giants: Steinhoff (12), Top Performers: Mr Price
(295) Top Performers: Pergrin Pallinght, Altron , Keaton, S (252), Alaris (254), Cognition PNR Foods (59), KAP (65), (21), RMIH, Brait, Sabvest,
■ ABSA CORPORATE AND (66), Invicta (87), Mustek Ocean , Coal, Iapf, Ascendis, (272), Cenrand (278), ISA Capitec (67), PSG (83), Woolies, Discovery, Mpact,
INVESTMENT BANKING (115), Pinnacle (152), Adcorp Novus Tharisa (281), Putprop (286), Bauba Zeder (93), QFoods (122), Firstrand, LifeHC, RMBH,
SA Giants: B-Africa (19), (177), Purple, DAWN , ■ JP MORGAN CAZENOVE (288) Deneb (134), Argent (155), Remgro, Richmont, Comair ,
Exxaro (63) Primeserv , ResGen (UK)SA Giants: PSG (93) Top Performers: Micromega, Niveus (183), Curro (194), CapevinH, Distell, ELBGroup,
Top Performers: B-Africa ■ DEUTSCHE SECURITIES SA SA Giants: SAB (4), Barworld Adaptit , EOH , Alaris, Taste, Granprade (204), Psg-kst Reinet, Trencor, JSE, Clover
(154), Exxaro (234) (PTY) LTD (28) Conduit , Workforce , Itltile, (212), AEEI (222), Rockwell (138), Datatec, Emira, AECI,
SA Giants: Abinbev (3), Top Performers: SAB, Cognition , Omnia , Amecor, (223), Sirius (226), Rare Sunint, Hosp, Hulamin,
■ APPLEBY SECURITIES Putprop , ISA, Dcentrix, PSV, Reunert, Wildrness (198),
(BERMUDA) LTD Sanlam (7), Sasol (9), MTN Barworld (240), Fairvest (257), Safari
Group (10), Stanbank (13), Cenrand , Bauba (265), Silverb (280), Oasis RCLFoods, Adcock, Converge,
SA Giants: Stenprop (241) ■ JP MORGAN EQUITIES Eqstra, Bell, Delta, Anglo,
Top Performers: Stenprop Massmart (20), Anggold SOUTH AFRICA (PTY) LTD ■ MERRILL LYNCH SOUTH (282), Nutrition (289),
(32), Netcare (39), Implats AFRICA (PTY) LTD Afdawn (294), Sacoil (298), Astrapak, Kumba (253),
(309) SA Giants: B-Africa (19), Amplats, Homechoice,
(41), M&R Hld (45), Suprgrp Barworld (28), Aveng (35), SA Giants: BHPBill (2), Chrometco (300), Eastplats
■ ARBOR CAPITAL (57), Tsogo Sun(77), ARM Imperial (15), OldMutual (30), (306), Rangold (310), Choppies, AlexForbes, RFG,
SPONSORS (PTY) LTD Tigbrands (42), ArcMittal Zakhele
(91), Net1UEPS (97), Coronat (43), Gfields (44), Sibanye MMI (36), Lib Hold (37), Blackstar (324), Wesizwe
SA Giants: Caxton (106), (116), Transcap(185) Intuprop (81), PPC (92), (325) ■ RIVER SPONSORS (PTY)
Winhold (181), Bowcalf (199), (53), Lonmin (68), Harmony
■ Top PerformersCoronat (11), (69), Illovo (75), Astral (79), Merafe (117), RBPlat (128), Top Performers: AEEI, PSG , LTD
Cargo (201), Culinan (202), Capco (139), Nedbank (318) Curro, Zeder, PNR Foods, SA Giants: Santova (123),
Beige (233), AME (248), Suprgrp (25), Sanlam , Cityldg (176)
Netcare , Transcap , Top Performers: Sibanye, Top Performers: Capco , Capitec, Niveus, Steinhoff, Petmin, Kibo
Global (258), Advhlth (259), OldMutual (69), Lib Hold (74), KAP, Granprade, Fairvest, Top Performers: Santova,
AH-Vest (264), Spanjaard Net1UEPS , Tsogo Sun , MTN Cityldg , Tigbrands , B-Africa,
Group), Stanbank , Sasol, Astral , Barworld, Illovo, MMI, Nedbank, Imperial, Eastplats, Oasis, Rangold Petmin, Kibo
(270), Orion (274), Telemastr Intuprop, BHPBill, PPC, (172), Blackstar, Silverb,
(275), Visual (279), Anchor Massmart , M&R Hld , ARM , ArcMittal , Gfields, Aveng, ■ OSASFIN CAPITAL (A
Harmony, Lonmin RBPlat, Merafe Afdawn, Argent, Rockwell, DIVISION OF SASFIN BANK
(279), Adrenna (291), Anggold (, Implats, Abinbev Nutrition (262), Wesizwe,
Moneywb (292), Labat (295), ■ EXCHANGE SPONSORS ■ JAVA CAPITAL (PTY) LTD ■ NAMIBIA EQUITY BROKERS LTD)
(PTY) LTD Chrometco, Sacoil, Rare , SA Giants: Oando, BSI ,
Delrand (303) (PTY) LTD SA Giants: Redefine (105), Deneb, Sirius, Safari, QFoods,
Top Performers: Culinan (65), SA Giants: Wearne (232), CIL (121), Hyprop (132), NEPI SA Giants: Afrox (111) Marshall, Nuworld, Afro-C,
Top Performers: Afrox Psg-kst MSHolding, Trustco, Erin,
AME (94), AH-Vest (101), Ansys (249), Gooderson (143), Pergrin (149), Resilient
Cargo (134), Spanjaard (137), (153), Ellies (154), Vukile ■ NEDBANK CORPORATE ■ PRICEWATERHOUSECOOPERS Hwange, Spurcorp, Crookes,
(269), Imbalie (277), CORPORATE FINANCE
Caxton (168), Adrenna (174), Stratcorp (293), Sableplat (158), Mixtel (170), Onelogix AND INVESTMENT Jubilee (273), Trematon,
Orion (175), Global (182), (317) (171), Attacq (175), Redefintl BANKING (PTY) LTD Diamondcp, GIY, Sasfin
Telemastr (184), Bowcalf Top Performers: Imbalie, (180), Andulela (187), Rebosis SA Giants: Shoprit (14), SA Giants: Afrimat (150) Top Performers: MSHolding,
(213), Delrand (228), Beige Gooderson, Ansys, Sableplat, (192), enX (205), Fortressa OldMutual (30), Group 5 (71), Top Performers: Afrimat (19) Trustco, Spurcorp, Marshall,
(249), Moneywb (260), Labat Stratcorp, Wearne (208), Arrow (210), Kaydav Cashbil (101), Hudaco (115), ■ MCCANN WORLDGROUP Trematon, Crookes, Sasfin,
(261), Winhold (267), Advhlth (215), Efficient (220), Dipula Brimston (152), Wescoal SA Giants: Zurich SA (120) Diamondcp, Nuworld, BSI,
■ GRINDROD BANK LTD (227), Af & Ovr (230), Rex Top Performers: Zurich SA Oando, Hwange, Jubilee, Erin,
(301), Anchor (306), Visual SA Giants: Grindrod (72), (159), Octodec (162), SA Corp
(324) True (231), Ascen (236), (184), Delprop (193), (169) GIY, Afro-C
Basread (104), ARB (141),
■ BEAUFORT SECURITIES LTD Rolfes (188), Jasco (189), Stenprop (241), Synergy Ingenuity (244), Osiris (255), ■ MORTIMER HARVEY ■ STELLAR ADVISORS (PTY)
SA Giants: Implats (46) Calgro (200), Interwaste (242), Tower (251), Indlu Nedbank (318) SA Giants: CMH (84), LTD
(209), Verimark (235), (261), Frontier (262), MAS Top Performers: OldMutual , Clientele (161), Howden (163), SA Giants: Torre (174)
■ CREATIVITY ADVERTISING (266), Equites (268), Cashbil , Wescoal , Brimston , Top Performers: Torre (4)
& DESIGN (PTY) LTD Finbond (263), Vunani (271) Tawana (323)
Top Performers: Finbond, Rockcastle (290), Atleaf Osiris (99), Ingenuity (105), Top Performers: Howden ■ THE STANDARD BANK OF
SA Giants: Jubilee (273)) (308) Nedbank (127), SA Corp
Top Performers: Jubilee Calgro, Interwaste , ARB, (28), Clientele (111), CMH SOUTH AFRICA LTD
Rolfes, Grindrod, Vunani , Top Performers: Rockcastle , (128), Octodec (142), Shoprit (173), Tawana (270) SA Giants: Stanbank, Telkom,
(284)) Kaydav, NEPI, enX , (147), Hudaco (153), Delprop
Jasco, Verimark , Basread ■ QUESTCO (PTY) LTD AVI, Oceana, Fambrands,
■ BRAVURA CAPITAL (PTY) Onelogix), Resilient, Vukile, (167), Group 5 (212) Assore, Accelerat, Metrofile
LTD ■ IJG SECURITIES (PTY) LTD CIL, Mixtel, Pergrin , Hyprop, SA Giants: Sentula (172),
SA Giants: Trustco (203) ■ NUMIS SECURITIES LTD Buildmax (190), Sephaku Top Performers: Fambrands,
SA Giants: Tradeh (245), MAS, Redefine, Ascen, (UK) AVI, Oceana, Metrofile (72),
Freedom (285), Ferrum (305) Top Performers: Trustco Synergy, Fortressa , Rebosis, (214), Sycom# (219), Forbes
SA Giants: SPanAfric (133) (225), Huge (256), Telkom, Stanbank, Assore
Top Performers: Tradeh (70), ■ INVESTEC BANK LTD Dipula , Af & Ovr, Rex True, Top Performers: PanAfric Ecsponent (287) (235), Accelerat
Ferrum (286), Freedom (293) SA Giants: Bidvest (8), Efficient , Ellies, Andulela, (113)
Naspers (24), Picknpay (25), Equites, Indlu, Attacq, Atleaf, Top Performers: Sephaku ■ UBS CORPORATE FINANCE
■ BRIDGE CAPITAL ■ OLD MUTUAL INVESTMENT (42), Sycom# (116), (SOUTH AFRICA) (PTY) LTD
ADVISORS (PTY) LTD Pikwik (26), Aspen (38), Stenprop, Redefintl (314),
WBHO (46), Altron (49), Frontier (320), Tower SERVICES (NAMIBIA) (PTY) Ecsponent (120), Huge (146), SA Giants: BATS, Mondi,
SA Giants: Stefstock (85), LTD Buildmax (272), Sentula Vodacom, Sappi, South32,
Afrimat (148), Advtech (150), Santam (51), Clicks (54), ■ JEFFERIES HOARE GOVETT
BlueTel (55), Tongaat (64), SA Giants: Shoprit (14) (287), Forbes (288) Nampak, Foschni, Lewis,
Insimbi (196), Prescient (211), SA Giants: Datatec (22) Holdsport)
Mazor (238), Accent (243) HCI (76), Growpnt (99), Top Performers: Datatec
Top Performers: Shoprit ■ RAND MERCHANT BANK
Raubex (103), E-media-n (147) CORPORATE FINANCE Top Performers: Mondi,
Top Performers: Afrimat (12), ■ KPMG SERVICES (PTY) LTD BATS, Foschni, Nampak,
Advtech (133), Insimbi (165), (119), Novus (120), Tharisa ■ ONE CAPITAL (PTY) LTD DIVISION
(130), Ascendis (131), Value SA Giants: Nictus (283), SA Giants: Spar (23), SA Giants: Anglo, Richmont, Vodacom, Holdsport, Sappi,
Prescient (215), Accent (216), Indeqty (284), Sasfin (312), Lewis, South32
Mazor (219), Stefstock (245) (147), S Ocean (157), Keaton Truwths (78), Metair (100), Firstrand, Datatec, Amplats ,
(167), Mastdrill (168), Sacoven (313) Northam (108), Afrox (111), Woolies, Kumba, Discovery, ■ VUNANI CORPORATE
■ CAPITAL MARKETS Trnpaco (173), Phumelela Top Performers: Indeqty, PanAfric (133), DRDGold Remgro, RCLFoods, Distell, FINANCE (PTY) LTD
BROKERS (PTY) LTD (179), Invprop (207), VPIF Sasfin (145), Nictus (218), (144), Atlatsa (146), Sovfood Mr Price, AECI, LifeHC, RMIH, SA Giants: Esorfrank (166)
SA Giants: Atleaf (308) (237), Iapf (253), Coal (302), Sacoven (160), York (165), Trnshex Sunint, Mpac, Eqstra, Clover, Top Performers: Esorfrank
Top Performers: Atleaf (303) Pallinght (316), Invltd (321), ■ LIBERUM CAPITAL INC (UK) (198) Reunert, Hulamin, Trencor, (273)
■ DELOITTE & TOUCHE Invplc (322) SA Giants: Sacoven (313) Top Performers: Metair (73), Choppies, Bell, Comair, ■ ZAI CORPORATE FINANCE
SPONSOR SERVICES (PTY) Top Performers: Naspers , Top Performers: Sacoven Spar (104), PanAfric (113), Adcock, RFG, ELBGroup, LTD
LTD Aspen), Mastdrill , Bidvest, ■ MERCHANTEC CAPITAL Sovfood (163), Truwths (171), Astrapak, JSE, AlexForbes SA Giants: Blackstar(324)
SA Giants: Adcorp (74), Clicks , Santam, Invplc, SA Giants: Omnia (62), EOH Trnshex (187), Northam (151), Emira, Homechoice, Top Performers: Blackstar
Invicta (86), Pinnacle (98), Invltd, HCI, VPIF, Growpnt, (87), Itltile (127), Dcentrix (207), Afrox (222), DRDGold Wildrness, Zakhele, Hosp,

70 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 71
Financial Mail Page 72-73 -29/08/16 02:28:22 PM

✥ MEDICAL AID ✥
✥ MEDICAL AID ✥

NHI: cure buckling under the pressure. huge mismatch between resources available and the middle class is being squeezed now,” he said.

SERVICES
SERVICES

And it is only going to get worse. citizens served. “These costs, and the rules being enforced by
“SA’s healthcare system is not merely unviable More importantly, the private for-profit health medical schemes, are forcing more people to turn
or unsustainable, it is at the brink of collapse, if sector limits the ability to achieve the income towards public healthcare, which we all know is

for ailing the government does not intervene,” Board of


Healthcare Funders MD Humphrey Zokufa told
the media at a briefing in June.
and risk cross-subsidies required to achieve a
universal health system, which the World Health
Organisation has called on all member states to
under pressure and stretched to the limit.
“A key element in the NHI will be the pooling
of funds which will give government a significant

system
Furthermore, South Africans will increasingly pursue. bargaining chip when it comes to rolling out
have to rely on the state in future as the rapid At the June media briefing Motsoaledi, quality medical care for all citizens.”
increase in the cost of members’ medical scheme together with the BHF, concurred that the pooling Meanwhile, following several appeals by the
contributions, to cater for the ever-soaring rates of resources for a national health insurance is the Minister of Health for the industry to come up
charged by private healthcare providers, is only way to lower cost and increase universal with innovative ways of providing affordable
becoming unaffordable to many. Currently, only access. medical benefits to the masses, the CMS
SA has some of the best 17.4% of the population is medically insured. Motsoaledi also addressed some of the developed a proposal to introduce low-cost
The affordability issue in turn, industry concerns raised around the NHI. benefit options to people who can otherwise not
private healthcare in the players say, will impact on the sustainability of He said the implementation of the NHI is by afford medical scheme coverage.
world but not for the public private for-profit providers.
The Council for Medical Schemes (CMS),
no means an attempt to destroy the private
healthcare sector.
The CMS explains hat the proposal received
widespread support from government and
regulator of the medical schemes industry, “It comes down to this simple dichotomy: SA industry.

D
revealed in its annual report for 2014/15, which has some of the best private healthcare in the It provided for a framework and detailed
ata published by the SA Institute of was released in September last year, that the world with some of the best resources available, guidelines on low cost benefit options and for
Race Relations recently shows that downward trend in the total number of medical but these resources are not available to the exemptions to be granted from compliance with
since 1994, spending by the state on schemes in operation continued in 2014. public. People must please ignore scare tactics, it certain sections of the Medical Schemes Act.
public healthcare increased to more On December 31 2014, there were 83 draws attention away from the good that the NHI “The Council has approved the framework,
than what households were prepared registered medical schemes, and CMS data can do,” he said. allowing medical schemes to apply for
to dish out on private medical cover. And even showed that scheme contributions increased by He was also quick to point out the costs of the registration of such options upon publication of
though the combined national and provincial 8.% to R140,2bn. Total gross relevant healthcare NHI were currently inherent in the system. “We the framework,” stated Daniel Lehutjo, Acting
expenditure accounts for almost 12% of total expenditure incurred by schemes increased by are often told that we are attacking the middle Chief Executive Officer and Registrar of the CMS.
government spending and SA’s per capita 10% to R124.3bn. The above-inflation rising cost class through the implementation of the NHI. But Ruan Jooste
expenditure of US$1,148 is comparable to that of of private health care took centre stage at the
other developing nations like Brazil and Turkey, health market inquiry by competition authorities
the fact that the majority of South Africans are earlier this year. MEDICAL AID SCHEMES/SOCIETIES AND CORPORATE CLIENTS
not covered by a medical aid has the system The inquiry panel, chaired by former
■ AECI MEDICAL AID ■ BONITAS MEDICAL FUND SA Giants: FSteinhoff (12),
Constitutional Justice Sandile Ngcobo, was SOCIETY SA Giants: Sanlam (7), Firstrand (18), Vodacom (21),
launched following concerns about the sector, SA Giants: AECI (61) Vodacom (21), Aveng (35), Aveng (35), Implats (41),
Aaron Motsoaledi including pricing and a lack of transparency. The Top Performers: AECI (155) BlueTel (55), LifeHC (70), Gfields (44), M&R Hld (45),
investigation into the private healthcare sector ■ AFROX MEDICAL AID EOH (87), Hulamin (95) WBHO (46), Discovery (48),
SOCIETY Top Performers: EOH (6), Altron (49), Clicks (54),
began in 2014 and the hearings were the last part Sanlam (54), LifeHC (56), BlueTel (55), Nampak (56),
SA Giants: Afrox (111)
of the process. Top Performers: Afrox (222) Vodacom (110), BlueTel (160), Suprgrp (57), Mr Price (60),
Submissions on the shortcomings of the Hulamin (189), Aveng (265) Omnia (62), Tongaat (64),
■ ANGLOVAAL GROUP KAP (65), Capitec (67),
current system and future challenges were made MEDICAL SCHEME ■ BUILDING &
CONSTRUCTION INDUSTRY LifeHC (70), Astral (79), PSG
by various parties, including the WHO, OECD, the SA Giants: ARM (91) (83), CMH (84), Invicta (86),
Top Performers: ARM (251) MEDICAL AID FUND
Health Professions Council of SA and organized SA Giants: Stefstock (85) EOH (87), Clover (90),
■ BANKMED Top Performers: Stefstock Reunert (94), Hulamin (95),
labour. SA Giants: Stanbank (13), Trencor (96), Net1UEPS (97),
Business Day quoted Health Minister Aaron (245)
Firstrand (18), B-Africa (19), Pinnacle (98), Growpnt (99),
Motsoaledi from the sidelines of the inquiry Net1UEPS (97) ■ CAPE MEDICAL PLAN Metair (100), Caxton (106),
Top Performers: Firstrand SA Giants: Caxton (106) Comair (110), DAWN (114),
stating that the department’s main aim was for Top Performers: Caxton
(53), Net1UEPS (67), Merafe (117), E-media-n (119),
the healthcare system to be fair. He said Stanbank (139), B-Africa (168) CIL (121), Santova (123),
healthcare prices were "exorbitant" and that (154) ■ CHARTERED Fambrands (124), BSI (125),
needed to change. ■ BARLOWORLD MEDICAL ACCOUNTANTS (SA) Ascendis (131), ELBGroup
SCHEME MEDICAL AID FUND (135), Astrapak (137),
Some of the issues being put forward to the SA Giants: MTN Group (10) Dcentrix (138), Nuworld
SA Giants: Barworld (28)
commission were symptoms of a bigger problem Top Performers: Barworld Top Performers: MTN Group (140), ARB (141), JSE (142),
and the root cause is what needed to be solved, (179) (130) Value (147), Pergrin (149),
■ COMPCARE WELLNESS Advtech (150), Ellies (154),
Motsoaledi said. ■ BESTMED MEDICAL Workforce (156), S Ocean
Over the years, government has argued that SCHEME MEDICAL SCHEME
(157), Octodec (162), York
Freddy Mavunda

SA Giants: Sanlam (7), Sappi SA Giants: Basread (104)


the experience of SA clearly demonstrates that Top Performers Basread (165), Esorfrank (166), Keaton
(27), Suprgrp (57) (167), Cityldg (176),
the private for-profit health sector serves a Top Performers: Suprgrp (266)
Phumelela (179), Winhold
minority elite, and that substantial general tax (25), Sanlam (54), Sappi ■ DISCOVERY HEALTH (181), Buildmax (190),
resources support these privileges, creating a (185) MEDICAL SCHEME

72 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 73
Financial Mail Page 74-75 -29/08/16 02:28:52 PM

✥ ADVERTISING ✥
✥ MEDICAL AID ✥

MEDICAL AID SCHEMES/SOCIETIES AND CORPORATE CLIENTS


Mobile segment of total adspend in the country.

SERVICES
SERVICES

However, TV advertising is by some measure still


Micromega (191), Curro (194), SA Giants: Clicks (54) Pikwik (26)
Conduit (197), Cargo (201), Top Performers: Clicks (96) Top Performers: Pikwik (190), the largest contributor to total advertising
Spurcorp (216), AEEI (222), ■ LIBERTY MEDICAL SCHEME Picknpay (199) revenue, followed by newspaper advertising.
Crookes (229), Rex True
(231), Verimark (235), Accent
(243), Delta (246), Huge
(256), Telemastr (275),
SA Giants: Lib Hold (37),
Spanjaard (270)
Top Performers: Lib Hold
(74), Spanjaard (137)
■ PLATINUM HEALTH
SA Giants: Amplats (29),
Atlatsa (146)
Top Performers: Amplats
rattles The report says their combined 52% share of
the market in 2014 will fall to 51% in 2019, due to
the meteoric rise of Internet advertising, which

desktop’ s
Sacoil (298), Brait (309), (258), Atlatsa (274) has a forecast compound annual growth rate of
Rangold (310), ResGen (311), ■ MALCOR MEDICAL SCHEME
SA Giants: Aspen (38), ■ REMEDI MEDICAL AID 21.7% to bring its share of total advertising up
Sasfin (312), Invltd (321),
Invplc (322), Wesizwe (325) Omnia (62) SCHEME from 5% in 2014 to 11% in 2019.
Top Performers: Micromega Top Performers: Aspen (19), SA Giants: Remgro (50), Vicki Myburgh, entertainment and media
Omnia (82) Trnshex (198)

web rule
(3), EOH (6), AEEI (7), leader for PwC Southern Africa, says: “Affordable
Santova (17), Conduit (20), ■ MASSMART HEALTH PLAN Top Performers: Remgro
Mr Price (21), PSG (24), SA Giants: Massmart (20) (77), Trnshex (187) Internet access will continue to digitally disrupt
Suprgrp (25), Brait (26), Top Performers: Massmart ■ RESOLUTION HEALTH the market in novel and innovative ways. The
Curro (27), Workforce (37), (195) MEDICAL SCHEME ongoing spread of services to mobile networks,
Discovery (39), Capitec (45), ■ MEDIHELP SA Giants: Rex True (231)
Top Performers: Rex True novel devices and emerging markets will change
Fambrands (50), Steinhoff SA Giants: Dcentrix (138)
(52), Firstrand (53), LifeHC Top Performers: Dcentrix (206) how media and entertainment are served,
(56), CIL (60), Spurcorp (64), (223) ■ RETAIL MEDICAL SCHEME Mobile advertising growing consumed and monetised in multiple ways.
Pergrin (66), Net1UEPS (67), ■ MEDSHIELD MEDICAL SA Giants: Shoprit (14) “Affordable Internet access will also inhibit the
Metair (73), KAP (80), Omnia
(82), Comair (84), Invicta
SCHEME Top Performers: Shoprit (147) at a blistering pace and revenue growth of various sectors as consumers
SA Giants: Trnshex (198) ■ SASOLMED
(87), ELBGroup (93), Clicks
(96), ARB (97), Crookes (98),
Top Performers: Trnshex
(187)
SA Giants: Sasol (9) exceeds expectations use it to access free, ad-funded and lower-priced
subscription-based versions of new and existing
Top Performers: Sasol (193)
Cityldg (103), Nampak (109), media services.”
■ METROPOLITAN MEDICAL ■ SIZWE MEDICAL FUND

M
Vodacom (110), Invplc (108),
Invltd (112), Trencor (117), JSE SCHEME SA Giants: Sappi (27), PwC predicts mobile Internet penetration will
(122), Growpnt (123), SA Giants: MMI (36), Implats Adcock (112), DAWN (114), obile will overtake desktop to have risen more than 32 percentage points from
Phumelela (132), Advtech (41) Delta (246)
Top Performers: MMI (85), Top Performers: Sappi (185), become the primary Internet 2014 to 2019, reaching 69% in the latter year.
(133), Cargo (134), Clover
(138), E-media-n (141), Implats (268) DAWN (204), Adcock (209), advertising medium in 2017, a year “Globally, we are seeing a mobile surge and a
Octodec (142), Sasfin (145), ■ MOMENTUM HEALTH Delta (237) earlier than previously forecast. trend of replacing the PC with mobile devices as
Huge (146), Pinnacle (152), SA Giants: MMI (36), ■ SOUTH AFRICAN Zenith’s new Advertising the primary device — certainly in Africa, the
Astral (159), BlueTel (160), Suprgrp (57), Capitec (67), BREWERIES MEDICAL
Tongaat (161), Value (166), Illovo (75), Stefstock (85), Expenditure forecasts, published in June, predict mobile is often the only device available,” says
SCHEME
Caxton (168), Rangold (172), Caxton (106), Bell (109), SA Giants: SAB (4) advertisers, worldwide, will spend US$99.3bn on Yaron Assabi, founder and CE of the Digital
CMH (173), Telemastr (184), Marshall (126) Top Performers: SAB (68) mobile Internet advertising in 2017, compared Solutions Group. Brands that want to engage and
Hulamin (189), Reunert (194), Top Performers: Suprgrp ■ SPECTRAMED with US$97.4bn on desktop Internet advertising. target consumers should shift a significant
WBHO (196), Nuworld (202), (25), Capitec (45), Marshall SA Giants: Phumelela (179)
DAWN (204), Rex True (206), (75), MMI (85), Caxton (168), In December Zenith predicted that mobile amount of their advertising and marketing
Top Performers: Phumelela
Accent (216), Dcentrix (223), Illovo (205), Bell (233), (132) advertising would only overtake desktop in 2018, budgets to the mobile space, he says.
BSI (230), Altron (236), Delta Stefstock (245) but the media agency states that the rapid According to Assabi, the industry is already
(237), York (238), Keaton ■ TFG MEDICAL AID SCHEME
■ MOTO HEALTH CARE SA Giants: Foschni (66) development of the mobile advertising market noticing a move away from the standard banner
(240), Ellies (243), Merafe SA Giants: CMH (84)
(244), Gfields (248), M&R Hld SA Giants: Top Performers: since then has caused them to bring that ad, to 3D elements that may use features such as
Top Performers: CMH (173) Foschni (91)
(250), Astrapak (252), S prediction forward by a year. the “tilt” functionality of smartphones to provide
Ocean (257), Verimark (259), ■ NASPERS MEDICAL FUND ■ TIGER BRANDS MEDICAL
SA Giants: Naspers (24), SCHEME “Mobile advertising is growing at a blistering an experiential component, as well as features
ResGen (263), Aveng (265),
Winhold (267), Implats (268), Novus (120) SA Giants: Spar (23), pace: it grew 95% in 2015, and we forecast 46% such as embedded videos and social interactivity.
Wesizwe (269), Buildmax Top Performers: Naspers Tigbrands (42), Adcock (112)
(18), Novus (319) growth for 2016, followed by 29% growth in both Many services for consumers are now offered
(272), Esorfrank (273), Sacoil Top Performers: Spar (104), 2017 and 2018. Mobile is already the primary on a trial basis or free, in view of ad-supported
(281), Ascendis (305) ■ NATIONAL MEDICAL PLAN Tigbrands (125), Adcock
SA Giants: Invicta (86) (209) means of accessing the Internet. The advertising revenue or what is commonly known as a
■ FEDHEALTH MEDICAL Top Performers: Invicta (87)
SCHEME ■ TOPMED MEDICAL SCHEME market is catching up with the consumer as “freemium” model, says Assabi. “This type of
SA Giants: Sanlam (7), ■ NEDGROUP MEDICAL AID SA Giants: Sanlam (7) advertisers determine how best to communicate model implies that ad revenue subsidises the cost
Implats (41), Astral (79), SCHEME Top Performers: Sanlam (54) using the mobile Internet.” of services, or that the customer subsequently
Reunert (94), Growpnt (99), SA Giants: Nedbank (318) ■ UMVUZO HEALTH MEDICAL
Buildmax (190), Invltd (321), Top Performers: Nedbank In the larger markets such as China, the UK will convert to a premium model, whereby they
SCHEME
Invplc (322) (127) SA Giants: Clover (90), and the US, mobile advertising is already the would have more features available or access
Top Performers: Sanlam (54), ■ NETCARE MEDICAL Adcock (112) dominant form of Internet advertising. However, those features using an in-app purchase.”
Invplc (108), Invltd (112), SCHEME Top Performers: Clover (138), globally mobile advertising is some way behind The success of Candy Crush, for example, can
Growpnt (123), Astral (159), SA Giants: Netcare (39) Adcock (209)
Reunert (194), Implats (268), Top Performers: Netcare TV and will remain so for at least the next few be attributed to the fact that the game is both
■ WOOLTRU HEALTHCARE
Buildmax (272) (58) FUND years: “by 2018 we expect mobile advertising highly addictive and profitable, without resorting
■ GENESIS MEDICAL SCHEME ■ OXYGEN MEDICAL SCHEME SA Giants: Woolies (31) expenditure to total US$127.8bn compared with to forcing players to part with cash. It is free to
SA Giants: Vodacom (21), SA Giants: Caxton (106) Top Performers: Woolies (38) television’s US$192.2bn”. download and play, but there is an ability to
Reunert (94) Top Performers: Caxton
Top Performers: Vodacom (168)
According to PwCs entertainment and media purchase items within the games, like more lives
(110), Reunert (194) ■ PICK N PAY MEDICAL outlook for 2015-2019 — an analysis of the trends and moves.
■ HORIZON MEDICAL SCHEME shaping the entertainment and media industry in “Similarly, consumers are showing great
SCHEME SA Giants: Picknpay (25), SA — Internet advertising is becoming a key interest in video content consumption. Procter &

74 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 75
Financial Mail Page 76-77 -29/08/16 02:29:12 PM

✥ PR AGENCIES ✥
✥ ADVERTISING ✥

Gamble are reportedly looking at building marketers more time and opportunity to place

Social to come under King 4).

SERVICES
SERVICES

branded video-streaming channels in India, as an ads within streaming video content. Currently there’s no roadmap, but almost
alternative to the usual television ads,” Assabi Therefore it’s not surprising that mobile is fast every listed company has gone down the social
says. becoming the dominant channel through which media monitoring route. The draft version of
In emerging markets or developing
communities such as this, the power mobile
holds is incredible and consumers are watching
we consume video content. The increase in
short-form video from Instagram and Vine will
continue to fuel consumers’ appetite.
media: King 4 was released by the Institute of Directors
in March, and a significant new development in
the promotion of good corporate governance is

friend and
more videos on mobile devices overall, giving Ruan Jooste the recognition that social media provides
business leaders with an opportunity to embed
quantitative measures in managing reputation
ADVERTISING AGENCIES AND CORPORATE CLIENTS and stakeholder issues.
■ 1886 ADVERTISING
SA Giants: Sasfin (312)
Top Performers: Sasfin (145))
■ BASE TWO
■ J. WALTER THOMPSON
SA Giants: Lewis (118)
Top Performers: Lewis (188)
■ JOE PUBLIC
Verimark (235)
Top Performers: Verimark
(259), Andulela (276)
■ ROERING CREATIVE KIN
foe King 4 advises that the governing body should
oversee the formation of an integrated
stakeholder communications plan that uses
digital and other communications platforms as a
SA Giants: B-Africa (19) SA Giants: Amplats (29), SA Giants: Discovery (48) strategic tool “for marketing, as a source of
Top Performers: B-Africa Clover (90), Adcock (112), ■ SAATCHI & SAATCHI intelligence, to influence perceptions about the
(154) Nedbank (318)
■ BASTION GRAPHICS (PTY) Top Performers: Nedbank
BRANDSROCK
SA Giants: MMI (36)
Mass adoption of digital brand and product, and improve transparency
LTD (127), Clover (138), Adcock Top Performers: MMI (85) and communications”.
SA Giants: Aspen (38), (209), Amplats (258)
■ SAUCE ADVERTISING (PTY)
communications introduces “The public relations industry, which is best
Implats (41) ■ KING JAMES GROUP LTD
Top Performers: Aspen (19), SA Giants: Sanlam (7), SA Giants: Fambrands (124) new risks to companies suited to capitalise on this development, is
nowhere to be seen in this regard. Unsurprisingly,
Implats (268)) Tigbrands (42), Comair (110) Top Performers: Fambrands
Top Performers: Sanlam digital agencies and social listening providers

E
■ BLUE PARROT (50)
ADVERTISING (54), Comair (84), Tigbrands have been eating into PR profits and margins for
(125) ■ SMART STRATEGIC
SA Giants: Adcock (112) MARKETING xecutives are scrambling to respond to the past five years,” says Kaveer Bharee, principal
Top Performers: Adcock ■ MULLENLOWE SOUTH SA Giants: Dcentrix (138)
(209) AFRICA controversial social media developments consulant at Ubiquity Consulting.
Top Performers: Dcentrix with greater urgency than ever before. IBM estimates that 43% of all external
■ COOLE ADVERTISING & SA Giants: Adcock (112) (223)
PROMOTIONS (PTY) LTD Top Performers: Adcock Just this year, an estate agency swiftly company data will be generated on social
(209) ■ SPECTRUM NOTES AND
SA Giants: Implats (141) PROMOTIONS CC distanced itself from former employee platforms by 2020. “That’s a large chunk of data
Top Performers: Implants ■ ME GRAPHICS SA Giants: Adcock (112) Penny Sparrow’s racist comments; Standard to leave in the hands of an external provider,”
(268) SA Giants: Adcock (112) Top Performers: Adcock
Top Performers: Adcock Bank joint CEO Sim Tshabalala wrote an article says Bharee.
■ DMD MARKETING SA (209)
SA Giants: DAWN (114) (209) in light of comments made by Though the Institute of
■ SWITCH BRANDING &
Top Performers: DAWN (204) ■ MARKETING CONCEPTS DESIGN (PTY) LTD economist Chris Hart; and Directors of SA (IoDSA) hasn't
■ FCB SOUTH AFRICA (PTY) LTD SA Giants: Invprop (207), M-Net and Gareth Cliff almost released any information on
SA Giants: Firstrand (23), SA Giants: Growpnt (99) Invltd (321), Invplc (322)
Top Performers: Growpnt faced off in court after the how King 4 will advise,
Tigbrands (42), Adcock (112) Top Performers: Invplc (108),
Top Performers: Firstrand (123), Octodec (142) Invltd (112), Invprop (136) former terminated its contract Michael Lasch, who is
(53), Tigbrands (125), Adcock ■ MORTIMER HARVEY ■ TBWA with Cliff over his comments responsible for the
(209), Anggold (264) SA Giants: B-Africa (19) SA Giants: Stanbank (13), on social media. establishment of the IoDSA
■ GAMEPLAN ADVERTISING Top Performers: B-Africa Tigbrands (42), Cityldg (176) Most recently, Cell C's CEO Governance Assessment
SA Giants: Adcock (112) (154) Top Performers: Cityldg
Top Performers: Adcock ■ NATIVE was forced to do a media blitz Instrument as the
(103), Tigbrands (125),
(209) SA Giants: Comair (110) Stanbank (139) after his statements about measurement and reporting
■ GLOBAL MOUSE Top Performers: Comair (84) ■ THE JUPITER DRAWING female employees didn't go mechanism of King 3 practices
SA Giants: Discovery (51) ■ NINETY9CENTS ROOM (SOUTH AFRICA) down well on social platforms. in all industry sectors, agrees
Top Performers: Discovery SA Giants: Capitec (67) SA Giants: B-Africa (19) The mass adoption of digital communications there is no effective framework for reputation
(45) Top Performers: Capitec (45) Top Performers: B-Africa
(154) introduces new risks to companies that were not and stakeholder governance at the moment.
■ INCE (PTY) LTD ■ OGILVY & MATHER
SA Giants: Suprgrp (57), SA Giants: B-Africa (19), MMI ■ THE NEW BLACK envisaged just a decade earlier. Executives and Essentially companies in SA don’t have a handle
Illovo (75), Astral (79), (36) SA Giants: Growpnt (99) directors - primarily the CEO and board — are on this at all yet, he says. And PR companies are
Metair (100), Santova (123) Top Performers: MMI (85), Top Performers: Growpnt charged with navigating their companies through adding no strategic value to companies
Top Performers: Santova B-Africa (154) (123)
(17), Suprgrp (25), Metair this minefield, guided by the governance codes whatsoever.
■ OGILVYONE WORLDWIDE ■ TROIKA IMAGINEERING
(73), Astral (159), Illovo SA Giants: Sunint (82) WORKS (PTY) LTD under King 3 chapter 8 (with further refinement Ruan Jooste
(205) Top Performers: Sunint (162) SA Giants: Sappi (27)
■ INTIMEDIA ■ PHD SOUTH AFRICA Top Performers: Sappi (185)
SA Giants: Growpoint (99)
Top Performers: Growpoint
SA Giants: BCX (100)
Top Performers: BCX (178)
■ VISIONEERS PUBLIC RELATIONS AGENCIES AND CORPORATE CLIENTS
SA Giants: Pergrin (149)
(123)
■ PHD SOUTH AFRICA Top Performers: Pergrin (66) ■ ANNE DUNN ■ APRIO STRATEGIC (268)
■ IRELAND/DAVENPORT SA Giants: Capitec (67) ■ YOUNG & RUBICAM SA COMMUNICATIONS COMMUNICATIONS ■ ATMOSPHERE
SA Giants: Vodacom (21), Top Performers: Capitec (45) (PTY) LTD SA Giants: Tigbrands (42), SA Giants: Aveng (35),
Invprop (207) COMMUNICATIONS
■ PURPLE FROG SA Giants: Picknpay (25) VPIF (237) Implats (41), PanAfric (133) SA Giants: Sanlam (7),
Top Performers: Vodacom Top Performers: VPIF (121), Top Performers: PanAfric
(110), Invprop (136)) COMMUNICATIONS ■■ Nampak (56), Capitec (67),
SA Giants: Andulela (187), Tigbrands (125) (113), Aveng (265), Implats Comair (110)

76 FINANCIAL MAIL • TOP COMPANIES • 2016 FINANCIAL MAIL • TOP COMPANIES • 2016 77
Financial Mail Page 78 -29/08/16 02:29:22 PM

✥ PR AGENCIES ✥

PUBLIC RELATIONS AGENCIES AND CORPORATE CLIENTS


SERVICES

Top Performers: Capitec ■ FINSBURY SA Giants: Foschni (66)


(45), Sanlam (54), Comair SA Giants: OldMutual (30) Top Performers: Foschni (91)
(84), Nampak (109) Top Performers: OldMutual ■ LUXURY BRANDS CC
■ BELL POTTINGER (69) SA Giants: Ascendis (131)
FINANCIAL & CORPORATE ■ FLEISHMAN-HILLARD INC Top Performers: Ascendis
LTD SA Giants: B-Africa (19), (305)
SA Giants: PanAfric (133) LifeHC (70) ■ MACMILLAN
Top Performers: PanAfric Top Performers: LifeHC (56), COMMUNICATIONS INC
(113) B-Africa (154) SA Giants: Cityldg (176)
■ COOLE ADVERTISING & ■ HG STRATEGIC Top Performers: Cityldg (103)
PROMOTIONS (PTY) LTD COMMUNICATIONS CC ■ MAGNA CARTA PR
SA Giants: Implats (46) SA Giants: DAWN (114) SA Giants: Stanbank (13),
■ BRIAN GIBSON ISSUE Top Performers: DAWN (204) Clicks (54)
MANAGEMENT ■ HEIDI ROLFE STRATEGIES Top Performers: Clicks (96),
SA Giants: Rangold (310) SA Giants: DAWN (114) Stanbank (139)
Top Performers: Rangold Top Performers: DAWN (204) ■ MARKETING CONCEPTS
(172) ■ HILL+KNOWLTON (PTY) LTD
■ BRUNSWICK (SA) LTD STRATEGIES (JHB) SA Giants: Growpnt (99),
SA Giants: MTN Group (10), SA Giants: JSE (142), Sacoil Vukile (158), Freedom (285)
Sappi (27), Omnia (62), (298) Top Performers: Vukile (35),
Advtech (150), Accelerat Top Performers: JSE (122), Growpnt (123), Freedom
(217), Invltd (321), Invplc Sacoil (281) (293)
(322) ■ HUDSON SANDLER LTD ■ MEROPA
Top Performers: Omnia (82), (UK) COMMUNICATIONS (PTY)
Invplc (108), Invltd (112), MTN SA Giants: Capco (139) LTD
Group (130), Advtech (133), Top Performers: Capco (32) SA Giants: Woolies (31))
Sappi (185), Accelerat (304) Top Performers: Woolies (38)
■ INCE (PTY) LTD
■ BUCHANAN SA Giants: Santova (123) ■ MULLENLOWE SOUTH
COMMUNICATIONS Top Performers: Santova (17) AFRICA
(LONDON) ■ INSTINCTIF PARTNERS SA Giants: Adcock (112)
SA Giants: Sacoil (298) SA Giants: Barworld (28), Top Performers: Adcock
Top Performers: Sacoil (281) M&R Hld (45), Illovo (75), (209)
■ CALIBRO Intuprop (81), Clover (90), ■ NOVELLA
COMMUNICATIONS Metair (100), Raubex (103), COMMUNICATIONS
SA Giants: Shoprit (14) Fambrands (124), Capco SA Giants: Sirius (226)
Top Performers: Shoprit (139), Octodec (162), Delprop Top Performers: Sirius (310)
(147) (193) ■ OGILVY PUBLIC RELATIONS
■ CAMBIAL Top Performers: Capco (32), SA Giants: MMI (36)
COMMUNICATIONS Fambrands (50), Metair (73), Top Performers: MMI (85)
Top Performers: Calgro (200) Clover (138), Octodec (142),
Intuprop (149), Delprop (167), ■ PR CONNECTIONS (PTY)
Top Performers: Calgro (2)
Barworld (179), Raubex LTD
■ CORPORATE IMAGE SA Giants: Dcentrix (138)
CONSULTANTS INC (203), Illovo (205), M&R Hld
(250) Top Performers: Dcentrix
SA Giants: Vodacom (21), (223)
Picknpay (25), Pikwik (26), ■ JENNI NEWMAN PUBLIC
RELATIONS (PTY) LTD ■ PROOF COMMUNICATION
Mr Price (60), Granprade
(204) SA Giants: Cenrand (278) AFRICA
Top Performers: Cenrand SA Giants: Petmin (178)
■ Top Performers■ Mr Price Top Performers: Petmin
(21), Granprade (81), (275)
(256)
Vodacom (110), Pikwik (190), ■ JOE PUBLIC (SOUTH
AFRICA) ■ PURPLE FROG
Picknpay (199) COMMUNICATIONS
■ EDELMAN SA (PTY) LTD SA Giants: Adcock (112)
Top Performers: Adcock SA Giants: Andulela (187)
SA Giants: B-Africa (19) Top Performers: Andulela
Top Performers: B-Africa (209)
(276)
(154)) ■ KPMG MAKINSON COWELL
SA Giants: OldMutual (30) ■ RUSSELL AND ASSOCIATES
■ ENVISAGE INVESTOR & Top Performers: OldMutual SA Giants: Northam (108),
CORPORATE RELATIONS (69) DRDGold (144), Atlatsa (146),
SA Giants: Esorfrank (166) Coal (302)
Top Performers: Esorfrank ■ KEYTER RECH INVESTOR Top Performers: Northam
(273) SOLUTIONS (207), DRDGold (232),
■ FTI CONSULTING INC SA Giants: Suprgrp (57), Atlatsa (274), Coal (289)
SA Giants: Redefintl (180) Astral (79), Stefstock (85),
EOH (87), ARB (141), Ellies ■ SHAUNEEN BEUKES
Top Performers: Redefintl COMMUNICATIONS
(314) (154), Accent (243)
Top Performers: EOH (6), SA Giants: Aspen (38)
■ FINANCIAL & CORPORATE Suprgrp (25), ARB (97), Top Performers: Aspen (19)
RELATIONS (FCR) Astral (159), Accent (216), ■ TIER 1 INVESTOR
SA Giants: ResGen (311) Ellies (243), Stefstock (245) RELATIONS
Top Performers: ResGen ■ LANGE STRATEGIC SA Giants: Lewis (118)
(263) ■■
COMMUNICATIONS

78 FINANCIAL MAIL • TOP COMPANIES • 2016


Financial Mail Page 79 -29/08/16 10:42:12 AM

10.75%
06 – 11 months: 8.00%
7.25%
12 – 24 months: 8.75%
25 – 36 months: 9.50%
9.25%
37 – 48 months: 9.75%
59 months:
49 – 59 months: 10.25%
10.00%
66 months:
60 – 66 months: 10.50%
10.25%
72 months:
67 – 72 months: 10.75%
10.75%
7 Day Notice: 6.75%
32 Day Notice: 7.25%
Financial Mail Page 80 -29/08/16 10:43:08 AM

36823_SANLAM "Our Opinion"_297x235.indd 1 2016/07/01 1:41 PM

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