COMPANY NEWS IN BRIEF

Spar scraps interim dividend Spar has scrapped its interim dividend amid a double-digit decline in profit as the company struggles with rising costs, high interest rates and difficulties with a new IT system. The JSE-listed retailer reported on that its operating profit fell almost 18% to about R1.5 billion for the six months to end-March 2023. Its diluted headline earnings per share fell more than 30%."Go-live challenges" with new SAP software - or enterprise planning software - at its KwaZulu-Natal distribution centre resulted in lost turnover, the group said. At the same time, rising interest rates hiked finance costs on its debt. Its costs have also increased across the world. Outside of SA, it operates in Poland, Switzerland, the UK and Ireland. In light of these challenges, Spar decided it was "prudent" not to declare a dividend.The group, valued at about R20 billion on the JSE, flagged the fall in profit in a trading update about two weeks ago, with its shares falling more than a fifth over two days as a result.Its Spar Southern Africa division reported an increase in turnover of almost 6%, with sales impacted by a "constrained consumer environment" exacerbated by load shedding.-Fin24Telkom suffers R10 billion lossSouth Africa's third-biggest mobile operator Telkom warned it wouldn't pay dividends for a fourth year, believing it prudent to first strengthen its balance sheet after suffering an annual loss of about two-thirds of its market value.Telkom, valued at about R15.7 billion on the JSE, reported a R10 billion loss in the year to end-March - from a profit of R2.6 billion previously. Hefty impairments, restructuring costs and load shedding hit the company. More pleasingly, active mobile subscribers grew 7.8% to about 18.3 million.Revenue grew 0.9% to about R43 billion, driven by almost 14% growth in its IT business. But its wholesale infrastructure business Openserve reported a 26% fall in fixed-line revenue, and a more than 30% fall in legacy data revenue.Openserve, along with Telkom Consumer - which includes its mobile and internet service units - were also subject to a R13.2 billion non-cash writedown, a reflection of technological changes, weaker economic conditions, and the fact the company's shares have been trading below their net asset value for a significant period of time. Telkom had also written down its copper assets in 2013 by about R12 billion. Its fixed-line internet subscribers fell about a fifth in 2023, with fixed broadband subscribers down almost 3%.-Fin24South African Airways (SAA) deal in sight The minority shareholders in the Takatso Consortium have accepted the Competition Commission condition that they exit the strategic equity partnership with South African Airways (SAA) in order for the deal to go through.The minority shareholders are now in the process of appointing a corporate advisor with experience in global aviation deals. The advisor will help assess the market for potential buyers, confirm the fair value of the business and assist with the legal process, according to Gidon Novick, who represents the minority shareholders."We will use our best endeavours to sell our minority stake, but obviously the outcome cannot be guaranteed," Novick told News24. "It's a pity. We really wanted to play a meaningful role in a successful privatisation in this country."In May, the commission recommended that the Competition Tribunal approve the disposal of a 51% stake in South African Airways (SAA) to Takatso – provided certain conditions are met. One of these conditions is that the minority partners in the consortium, Global Aviation and Syranix - which co-owns LIFT airline – exit, to avoid decreasing competition in the domestic passenger market.In terms of the Takatso deal, the consortium would obtain 51% of SAA's shares and provide the airline with a capital injection of R3 billion over two years. The Department of Public Enterprises (DPE), as government's shareholder representative, would keep 49%.-Fin24Prasa targets further service recoveryHaving spent its entire capital budget allocation, the Passenger Rail Agency of SA (Prasa) has set a target of having close to 80% of its original 40 operational corridors functioning by March 2024.The railway utility is currently operating limited train services on 18 lines – while at the end of March 2022, it was running just five train services that transported about 15 million passengers. It is aiming to add another five million by next year, taking the total to 20 million.At its height, Prasa transported more than 500 million passengers in the year ended March 2015. There are currently eight operating lines in the Western Cape, six in Gauteng and four in KwaZulu-Natal. Prasa is focusing on rebuilding and modernising 33 train stations this year and fencing off some of its depots and maintenance yards in these areas."We are targeting to be operating 32 corridors by the end of this financial year," Prasa group chief executive officer Hishaam Emeran told the transport portfolio committee of parliament on Tuesday.This will bring the total to 80% of the train services the utility operated before the national lockdown began in March 2020.-Fin24Salticrax defeats SnackCraxThe Supreme Court of Appeal (SCA) has handed victory to the Salticrax brand, overturning a high court ruling that found in favour of its competitor SnackCrax. AVI-owned Salticrax has fought to bar Cape Cookies from trademarking its SnackCrax brand.Through its subsidiary National Brands, AVI contended that it was the only owner of a trademark that included "crax" since 1951. In 2014, Cape Cookies applied to register the trade mark for its savoury biscuit brand, SnackCrax, which has been on sale ever since.But AVI argued that SnackCrax is riding on the reputation and goodwill of the Salticrax brand, which it established by spending many years and many millions of rands in marketing. By using a similar name, Cape Cookies is riding "on the coattails" of Salticrax, without itself having to spend time and money.For its part, Cape Cookies contended that "crax" is an abbreviation or variation of the word "crackers", which is an ordinary word.But, the SCA ruling found that there is no basis for concluding that "crax" is a word in everyday use or used as an abbreviation for crackers, and that the two products would be considered to be similar.-Fin24Optimum agrees with SIU to pay back R6.9mOptimum Coal Mine has signed an Acknowledgement of Debt with the Special Investigating Unit (SIU) and agreed to pay back approximately R6.9 million in unpaid motor licensing fees and penalties.This covers the period between January 2018 and November 2022. The non-payment of motor licensing fees contravenes the National Road Traffic Act, the state's anti-corruption, forensic investigation and litigation agency said in a statement issued on Tuesday.Optimum has been in business rescue since 2018 and is now also subject to a preservation order which was obtained by the National Prosecuting Authority (NPA) last year. The NPA has since moved for an order to have the mine's assets forfeited to the state. Optimum's Business Rescue Practitioners confirmed to News24 that an agreement had been reached to pay outstanding licensing fees "for vehicles that have been earmarked to be scrapped by the mine".The Acknowledgement of Debt emanates from the SIU’s investigation into allegations of corruption and maladministration in the affairs of the national and provincial departments of transport.-Fin24Brait reports strong performance Christo Wiese-backed investment group Brait said it had seen a strong operating performance from its most valuable asset, Virgin Active, reiterating that the most likely outcome for its gym and health business is its unbundling and separate listing.The group previously told News24 in November that Virgin Active, which makes up 53% of its R17.2 billion in assets, could end up as a standalone listing in the medium to long term as part of the investment holding company's plans to return value to shareholders.Reporting its full-year results for the year to end March, the company reported a "strong" operating performance from Virgin Active, which grew active membership 14% from to 963 000.Southern Africa, its biggest market and contributing 37% of revenue, grew net members 34 000 to 611 000, while in Italy, 25% of revenue, net membership jumped 30 000 to 165 000.Apart from Virgin Active, Brait has two other main investments, namely a 47% interest in food group Premier, which was listed on the JSE in March, raising proceeds of R3.6 billion for it, as well as a more than 18% interest in UK fashion group New Look.-Fin24JPMorgan to pay more than R5 billionJPMorgan Chase agreed to pay about US$290 million to settle a class action lawsuit by victims of Jeffrey Epstein, a person familiar with the matter said, resolving a large part of litigation over the bank's relationship with the disgraced financier.The largest US bank said on Monday in a joint statement with the lawyers for the woman who sued JPMorgan Chase that it had agreed in principle to settle the class action lawsuit.JPMorgan Chase did not admit wrongdoing in agreeing to settle according to the person familiar, who spoke on condition of anonymity."Any association with him (Epstein) was a mistake and we regret it," JPMorgan said. "We would never have continued to do business with him if we believed he was using our bank in any way to help commit heinous crimes."The bank is still facing a lawsuit by the government of the US Virgin Islands, where Epstein owned two neighboring islands and was suspected of abusing victims in his mansion.The proposed class action lawsuit said JPMorgan ignored internal warnings about Epstein's sexual abuses of girls and young women.-Fin24

COMPANY NEWS IN BRIEF

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Namibian Sun 2024-11-22

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COMPANY NEWS IN BRIEF

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Namibian Sun 2024-11-22

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