Ghost Mail lands the Remgro verdict: 'There's nothing here that makes us think the discount to INAV is going anywhere.' The numbers look great — HEPS up 42.2%, adjusted HEPS up 29%, free cash flow at the centre up 105.6%. Mediclinic led the earnings charge, with Community Investment Ventures, TotalEnergies and Heineken chipping in. But the story that matters is INAV: up just 4.6% to R305, while the stock trades at R205. That's a 33% discount.
Ghost's frustration is palpable and correct. The board chose a 550c special dividend instead of share buybacks. 'One can only wonder how much better the total return could've been if Remgro had done more buybacks.' Contrast with Sabvest — unlisted exposure you can't get elsewhere — Remgro is a basket of listed stocks you can buy direct. The conglomerate discount persists for a reason. NEUTRAL — great businesses, terrible capital allocation signal.
Ghost Mail's segmental dissection of Oceana's trading update is worth the price of admission. Lucky Star got hammered: canned fish volumes dropped 9% as raw material shortages slashed local canning production by 60%. Operating margins under threat. Ghost flags the silver linings — better net sales prices, lower freight costs — but when your core production is down 60%, overhead absorption is the bigger worry. Inventory 'significantly lower' than prior period doesn't bode well for the new financial year.
The Fishmeal Africa business is a disaster: 73% production decline, 72% sales volume drop, operating losses worsening despite 31% higher prices. Daybrook (USA) salvages the story — Gulf Menhaden landings 11% above the 5-year average, sales volumes +16%, prices +24%. Wild Caught Seafood recovers: hake +5%, horse mackerel +8%. The squid business is in the red. This is a classic 'wait for actual results' story. Ghost says 26 November. So do I. NEUTRAL — nature doesn't send profit warnings, but it sends plenty of volatility.
Ghost Mail flags this as the kind of transaction that proves SA industrial companies are sitting on hidden property gold. Mpact is selling a Paarl property for R185 million that was on its books at just R89.2 million — more than double the carrying value. The property was previously occupied by Mpact Versapak (disposed November 2024), so this is the final clean-up of that deal. The annual rental income was R17.5m — at R185m that's a 9.5% yield, not bad for an industrial asset.
Ghost's broader point is worth noting: 'People often talk about the enormous value of property in SA that is carried at historical cost on the balance sheets of retailers and industrial companies.' Mpact shareholders just got a reminder of that value. Post the interim results (NEUTRAL Aug 24), this is a tidy non-core asset sale that strengthens the balance sheet. BULLISH — hidden value surfacing through disciplined asset recycling.
Ghost Mail cuts through the spin on Harmony's $500m convertible bond. The CEO says the capital programme is 'fully funded' and this is just 'diversifying funding sources.' Ghost's response: cheaper cash flow cost, but not cheaper in true cost to shareholders once equity dilution is factored in. The conversion price will be 35-40% above the reference price, so dilution depends on Harmony's share price performance. At full conversion, roughly 2.9% of current ordinary share capital — manageable but not trivial.
Harmony has had a rough few months: the Moab Khotsong fatality (rated NEUTRAL Sep 8) then Mponeng (BEARISH Sep 15). Now they're issuing convertible debt when they claim they don't need the money. In gold at $4,300/oz, why not just issue equity at these prices? The convertible structure says management thinks the stock goes higher — and doesn't want to cap upside now. Fair enough. NEUTRAL — sensible funding diversification, but the timing and messaging raise eyebrows.
Ghost Mail delivers the punchline with perfect timing: Crookes Brothers is disposing of its Mozambique macadamia businesses for $2. 'And no, that isn't a typo.' The nominal equity reflects $5 million in debt on the balance sheet and operations that needed continuous financial support to survive. They were in breach of covenants anyway, and no third-party buyers were identified. AgDevCo — a UK development finance institution — is taking over.
This is a clean exit from a failed expansion. Crookes Brothers tried to build macadamia operations in Mozambique and it didn't work. The $2 consideration tells you everything about the value (or lack thereof). Ghost's verdict: 'Probably a wise decision by Crookes Brothers.' Agree. Better to cut the cord at $2 than keep pouring capital into a loss-making venture. The core SA sugar and banana operations remain. NEUTRAL — painful but necessary portfolio pruning.