Pretoria News

The currency gallops towards the R20-mark to the US dollar in rapid decline FINANCIAL markets in South Africa entered a new difficult terrain yesterday as the rand galloped towards the R20-mark to the US dollar following a rapid decline triggered by investor sell-off. Foreign investors have been dumping South African rand-denominated bonds in favour of safe havens like gold, selling a net R11.4 billion so far. This rapid sell-off saw the rand breach the psychological R19-mark to the greenback for the first time in three years yesterday, reaching R19.29/$1 at 4pm. This was the lowest the rand has been since May, 2020, and has fallen more than 10% since the beginning of this year, meaning the rand’s buying power will diminish further. Traders are concerned that South Africa was…

SOUTH Africa’s economy may have skirted a technical recession in the first quarter of 2023, in spite of output in the primary industrial sectors of mining and manufacturing contracting in March. Data from Statistics South Africa (StatsSA) yesterday showed that mining production shrank by 2.6% year-on- year in March, following an upwards revised 7.6% dip in February. This marked the 14th consecutive month of contraction in mining activity, albeit softer than market estimates of a 7.3% decline, dragged down by electricity supply constraints and logistical bottlenecks. StatsSA said the annual decline in mining output was broad-based, with nine out of 12 divisions falling. The most significant negative contributors were diamonds which fell by 54.7%, and platinum group metals (PGMs), which declined by 9.1%. However, on a seasonally adjusted monthly basis,…

PRESIDENT Cyril Ramaphosa has confirmed that the South African government will be slowing down its planned decommissioning of coal-fired power plants as part of the country’s Just Energy Transition Programme in a bid to secure its energy security first. This endorses Minister of Electri- city in the Presidency Dr Kgosientsho Ramokgopa's proposal to delay the decommissioning of coal-fired power stations. In reply to written and oral questions in Parliament yesterday, Ramaphosa told the National Assembly that South Africa was fully committed to the Just Energy Transition Programme. However, he said that the government had to consider a number of factors in implementing the programme, including the negative impact of a rushed transition while the security of electricity supply had not been secured. “We have said we will transition to cleaner…

SAPPI was impacted by lower sales volumes, cost inflation and operational inefficiencies associated with inventory destocking, and second-quarter earnings before interest, tax, depreciation and amortisation (Ebitda) halved to $167 million (R3.13 billion) from $337m at the same time last year. “Following the record profitability last year, the group faced a severe downstream inventory destocking cycle. “This led to production curtailment in both the European and North American regions,“ Steve Binnie, the CEO of the pulp and paper group, said in a statement. The share price gained a sturdy 4.4% to R42.49 by yesterday afternoon and closed 6.44% higher at R43.31. Profit fell sharply to $69m from $188m. Earnings per share excluding special items declined to 11 US cents from 35 US cents. Binnie said Ebitda for the third…

MTN GROUP’S shares took a beating on the JSE after it said yesterday for the first quarter of 2023, it continued to navigate difficult macroeconomic, geopolitical and regulatory conditions, including South African load shedding, as it reported revenue growth. By 5pm the share price was 5.13% lower at R109.10 on the JSE yesterday. In its quarterly update for the period ended March 31, 2023, released yesterday, the group said revenue grew by 15.6% to R52.8 billion, with data usage jumping by more than a quarter. Core profit grew 11% to more than R24bn, but fell almost 7% in South Africa. The group’s core profit margin dropped by 2.7% points year-on-year to 43.7%. MTN Group president and CEO Ralph Mupita said: “MTN’s resilient business model and operational execution…

HUME INTERNATIONAL, the import, export, and distribution of frozen foods company, has warned of high chicken tariffs if the government doesn’t reduce the anti-dumping duties by July. In a statement yesterday, the group said food distributors have celebrated the government’s recent decision to lift the ban on Irish chicken after the country had been declared free of bird flu, stating that this would provide an important supplement to the local market as global supplies come under pressure. “But with punitive 158% anti- dumping duties on the horizon, this relief will be short-lived unless the government decides to extend the current suspension on tariffs past July this year,” Hume said. Hume International managing director Fred Hume said: “In keeping with international trade standards, South Africa’s decision to lift the trade ban…