PHANTOM SHARES: The Finance Ghost: JSE delistings continue, with Mediclinic set to disappear

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We aren’t used to seeing big names leaving the public market, yet this trend is coming through strongly.

Mediclinic looks set to disappear, with an offer by Remgro and the family behind Mediterranean Shipping Company. PSG has collapsed its holding structure, unbundling most of its assets to shareholders. The latest names to be added to the list are Massmart and Grindrod Shipping.

Walmart has put down an offer of R62 per share for Massmart, a spectacular premium of 68.7% to the 30-day volume-weighted average price. Taylor Maritime Investments Limited has made a non-binding indicative proposal to acquire all the shares in Grindrod Shipping that it doesn’t already hold. The indicative price is $26 per share.The gold miners have been a disappointment for many, with the gold price not rising quickly enough to offset the inflationary pressures on input costs. In such an environment, operational excellence is key to delivering decent results.

Harmony Gold has demonstrated what happens when operations don’t go well. Revenue was up by 2% in the year to June 2022, but production profit tanked by 20%. Operating cash flow was down 55%. When investing thematically, the old saying of “buying the shovel in the gold rush” has been particularly applicable in the past year. In this case, you wanted the drill rather than the shovel. Master Drilling grew headline earnings per share by 55.5% in the six months to June 2022, so earnings are supportive of growth in the share price of nearly 50% in the past year.

 

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