Cape Times 2022-07-29

The National Treasury could possibly take over at least half of the dues THE NATIONAL Treasury could possibly take over at least half of Eskom’s R400 billion debt, but this could come at a cost to the fiscus, which may threaten the country’s already weak credit rating status. This was one of the big assumptions made by Absa Bank economists in their Quarterly Perspectives for the third quarter in a presentation yesterday. Finance Minister Enoch Godongwana is set to unveil a solution for Eskom’s unsustainable debt during his Medium Term Budget Policy Statement in October. Absa senior economist Peter Worthington yesterday said they believed this could entail the transfer of a portion of Eskom’s debt onto the National Treasury’s balance sheet in the next fiscal year. However, Worthington said they…

Absa BANK has warned that the cost of living in South Africa will rise even further towards the end of the year, in spite of easing global oil and food prices. Absa macro-economist Miyelani Maluleke yesterday said the second- round effects of supply-side price shocks continued to drive up inflation, forcing aggressive monetary policy decisions. Maluleke said they believed the headline consumer price index (CPI) inflation would peak at 7.9 percent in October, before softening to end 2023 at 4.7 percent. Headline consumer inflation surprised on the upside and surged from 6.5 percent in May to 7.4 percent in June, its highest level since 2009, mainly driven by higher fuel and food prices. Maluleke said core inflation would be critical for the path of headline inflation…

THE SHARE PRICE of South Africa’s biggest steel producer, ArcelorMittal SA (Amsa) slid 15 percent yesterday despite it reporting a 22 percent increase in interim headline earnings to R3billion. The firm did not declare a dividend. Chief executive Kobus Verster, however, warned that economic headwinds had intensified both internationally and domestically, significantly affecting the trading environment. “The international price correction in a soft local demand environment will impact the financial results,” he said. The shares traded at a low of R5.50 in mid-morning trade following the release of results for the six months to June 30. Its revenue rose by 19 percent to R22.17bn. The net debt position was 61 percent lower at R1.09bn. “The company has successfully delivered against its predicted outlook and in some instances…

KAROOOOO, an international provider of real-time data analytics and business intelligence, reported solid results for its first quarter ended May 31, leaving management confident enough to keep the outlook for the remainder of the financial year unchanged. Total revenue was up 28 percent to R801 million (R626m). Revenue growth coupled with ongoing operating efficiencies resulted in profit for the period increasing 44 percent to R156m (R108m) and earnings per share 42 percent to R4.96m. Chief executive and founder Zak Calisto said in an interview that he believed the revenue growth momentum was sustainable throughout the year. He said he was satisfied with the financial performance, but there were some things he wished they could have done better, such as dealing with the “uphill battle” of…

ANGLO American reduced its dividend to its shareholders as the mining giant yesterday reported a 28 percent drop in interim earnings, knocked by supply chain disruptions, extreme weather and inflationary pressures. Despite this its shares increased on the JSE by 4.46 percent yesterday to R586.69 in morning trade after the company released its interim financial results for the six months ended June 30, 2022. Anglo reported basic headline earnings per share of $3.02 (R50.81) compared to $4.22 in the prior comparative period, with a 28 percent drop in underlying earnings before interest, tax, depreciation, and amortisation (Ebitda) to $8.7 billion. According to Reuters, they still beat an average Ebitda forecast of $8.56bn from 10 ana- lysts compiled by research firm Vuma. Anglo declared an interim dividend…

The Ombudsman for Banking Services (OBS) says banks and debt collectors are hoodwinking the public into paying debts that have lapsed and no longer needed to be repaid – a practice known as prescribed debt. Ombudsman Reana Steyn said between January 2021 and July 2022, her office received and investigated 193 complaints relating to allegations of collections on prescribed debts by banks and that in excess of R1 million was written off or repaid to complainants. She said 118 complaints were received in 2021 and that in 33% of these cases, the banks in question were found to have been unlawfully collecting or attempting to collect on prescribed debts. Steyn said in 2022, the OBS had received 75 of these matters. In 29% of these cases, banks have…