Omnia to the moon

Omnia Holdings (JSE: OMN) closed 14.6% higher on Friday after the company released a cautionary announcement. This is essentially a warning to the market that something big could be coming, hence the need to exercise caution when trading in the shares.

As you can see, caution has left the WhatsApp group:

This is because the company has noted that it is in discussions regarding a potential offer for all the shares. Interestingly, the announcement didn’t specifically refer to a third party, so there are many possible permutations here.

Having watched many deals fall over during my advisory career, I will remind you that these discussions can (and often do) fizzle out. That’s exactly why there’s a need for caution in the first place!

In the Bites today, I’ve covered almost all the news that came out on Friday on SENS, with particular focus on Caxton. But before that, we need to talk about delicious gelato…

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Caxton and CTP Publishers and Printers (JSE: CAT) released results for the year ended June 2026. This stock is a popular debate among value investors. Although the underlying exposures are difficult, it trades on a mid-single digit P/E and manages to endure just about anything that the world throws at it.

A strong balance sheet and large dividends flowing out the system are key to the investment thesis here, with the share price up 11.7% over 3 years vs. the total return over that period being closer to 40%.

In the latest financial year, revenue was down 1.8% and HEPS fell by 5.7%. Despite this, the ordinary dividend jumped by 157.1% after the board had declared a once-off interim dividend of R1 per share. The final dividend of 80 cents (up 14%) is a more reasonable indication of the cash flow to shareholders, although it does represent a higher payout ratio after HEPS went the wrong way.

The local newspaper publishing and printing operations suffered a revenue decline of 11% for the period. I’m not sure how I could be more bearish than I am on this business, as it depends on grocery retailers being willing to spend in local newspapers. That spend is holding up for now, but we can all see the focus on digital distribution at these retailers. The spend by retailers in other categories (like general merchandise) has already taken a nasty knock.

I imagine that some tough decisions had to be made for operating cost savings of 7% to be achieved in the local newspaper business, particularly in an environment of rising raw material prices and distribution costs as fuel prices moved higher.

At least the digital portfolio has seen growth, with revenue up by 17% across various channels.

The highlight has to be The Citizen, with revenue up by 8% and circulation having stabilised, while website users were up 25% and page views grew 30%. That’s a good example of a print-and-digital strategy in action.

The other issue in this business is the Department of Basic Education award of the Foundation Phase curriculum rewrite, driving a delay in the printing requirements from publishers as the tender award is investigated.

Overall, the publishing, printing and distribution segment saw revenue decline by 6.5% and EBIT drop by 18.9%. It feels like a very hard way to make money.

The packaging segment should be better in theory, but the underlying exposure including the alcohol and cigarette packaging sectors, neither of which are exactly growing volumes right now. The shift from quantity to quality doesn’t help the printers of labels, as the quality is mainly a function of what’s inside the bottle rather than what’s wrapped around it.

The stationery segment is exposed to back-to-school trading, another dicey long-term growth story due to pressure on the birth rate.

Overall, the packaging and stationery segment grew revenue by just 1.9% and EBIT by 3.8%.

Caxton is a business that needs to find new sources of growth. Management isn’t blind to this, with expansion capex up by approximately R100 million to R192 million. It’s a brave thing to do after the cash inflow from operating activities declined by 9.5%, but they have little choice.

Life Healthcare (JSE: LHC) has released a voluntary trading update for the 11 months to August 2026. The company had a tough first half of the year, particularly in the acute hospital business due to the issues at Sizwe Hosmed medical scheme. With paid patient days up by 0.8% since the interim period, they have pulled that metric up by 0.2% for the 11 months.

Acute hospital activity has been stable, while complementary services delivered growth in paid patient days of 3.2%. That’s the insight into the strategy that you really need: hospital groups are finding growth by moving beyond the traditional hospital offering. They are happy for you to come to casualty, but the real money is to be made in more specialised healthcare facilities.

Revenue growth of 1.7% for the 11 months isn’t exciting, but normalised EBITDA was up by 5.7% as the group unlocked margin benefits. This improved the southern Africa normalised EBITDA margin by around 60 basis points.

Gemfields (JSE: GML) has shed more than half its value year-to-date. The share price is down more than 80% over 3 years. With layers upon layers of risks in the business, they deserve to catch a break at some point.

There are some positive signs in the emerald market at least, with the latest auction achieving revenue of $29.6 million after all 44 lots were sold.

The average realised price was $9.72 per carat, but it’s hard to directly compare this to previous auctions as the quality of stones at each auction varies. But even with that caveat, it’s good to see that this price was the highest achieved over the past five auctions. It’s also the first time they’ve sold 100% of the lots offered for sale since at least 2024, which is why this auction achieved the highest revenue of the past five auctions.

Pan African Resources (JSE: PAN) has been ramping up gold production in recent years and they look set to continue doing so. The company has completed the Definitive Feasibility Study for the Soweto Tailings Retreatment project. This relates to the Soweto Cluster tailings storage facilities that were acquired as part of the Mintails transaction.

The project is expected to generate annual production of 35,000oz – 40,000oz, with a life of mine of around 15 years (roughly 561,000oz). The all-in sustaining cost is estimated to be $1,750 - $1800/oz, excluding the savings available from renewable energy supply.

The company assumes a gold price of $3,550/oz in the model, providing a real ungeared internal rate of return of 29.55% and a payback period of just 3 years.

This is why strong commodity prices lead to an uptick in mining investment. At the current gold price, this looks like a no-brainer for Pan African. They would need to invest roughly R3.68 billion in this project, well down from the initial estimate of R4.4 billion thanks to identified cost savings.

Remgro’s (JSE: REM) trading statement for the year ended 30 June 2026 looks good in theory, but using HEPS as the measure of performance is a position that the company stubbornly refuses to change. Even though the market values Remgro based on intrinsic net asset value per share rather than HEPS, the trading statement continues to use HEPS.

The direction of travel sounds good at least, with HEPS up by between 37% and 47%, or by between 24% and 34% on an adjusted basis. The share price has increased by 13% over the past 12 months. We will need to wait for detailed results before we get the numbers that really count.

Trellidor’s (JSE: TRL) financials for the year ended June 2026 tell a tale of a company that needs to move beyond its traditional business. Revenue from continuing operations was down by a nasty 20.3%, driven primarily by the unfortunate combination of weaker SA demand and a normalisation of UK project revenue.

The group swung from HEPS of 31.5 cents to a headline loss per share of -17.3 cents. It’s no surprise that there’s no final dividend for the period. The reduction in debt from R66.2 million to R44.6 million is one of the few highlights.

So, what’s the plan here? Well, management intends to use the existing manufacturing and distribution capabilities to expand the product range and get things back on track. In manufacturing, it’s all about achieving sufficient throughput for overhead absorption.

After suffering an operating loss in this period of R11.1 million after an operating profit of R39.5 million in the prior period, they cannot afford any mistakes in the implementation of the plan.

Tharisa (JSE: THA) has successfully priced a $300 million five-year senior secured bond. The bulk of the proceeds will be used for the Tier 1 Karo Platinum project in Zimbabwe, where first ore to the mill is expected in the fourth quarter of calendar year 2027. It looks like the funding cost on the bond has come in at roughly 11.5%.

After initially guiding a headline loss per share for the year ended June 2026, Putprop (JSE: PPR) now expects positive HEPS. In fact, they even expect an increase of between 0.2% and 20.2%! This just shows you how sensitive the earnings of small property funds can be to specific underlying property valuations. Separately, the company announced that the disposal of Summit Place has fallen through, as the purchaser has walked away from the deal.

Supermarket Income REIT (JSE: SRI) is acquiring six grocery assets for £104 million. The fund focuses on properties anchored by major grocery stores with triple-net leases, so the idea here is to obtain low-risk cash flow streams. These particular transactions help diversify the underlying exposure in terms of the anchor tenants and the extent of omnichannel distribution vs. traditional retail.

Selected Nibbles:

Do your own research and speak to your financial advisor. Nothing you read or listen to in Ghost Mail should be interpreted as financial advice. This is not a complete review of SENS and does not replace the need for you to refer to company announcements and reports yourself. Every effort is made to avoid errors in Ghost Bites and related podcasts, but I am only human.

Markets face a busy week of central bank decisions, with traders now pricing in more than an 80% chance of a Fed rate hike. The Bank of Japan is also expected to raise rates, while the Bank of England is expected to keep rates unchanged, though the decision looks set to be a close one.

The dollar is firm and US yields are higher to start the week, weighing early on precious metal prices, with gold and silver both lower on the day.

Oil remains elevated after further Houthi strikes on Saudi facilities and renewed military exchanges in the Strait of Hormuz.

US futures are firmly in negative territory this morning, while Asian equity markets trade mixed and semiconductor stocks are mostly lower.

The rand has weakened in risk-off trade, and we are expecting a negative start for the JSE All Share Index.

This update is provided by Shaun Murison, Senior Market Analyst at randswiss.com. Connect with him on LinkedIn here and follow him on X here.

Key Indicators: 

USD/ZAR R16.18/$ | US 10yr 4.96% | Gold $4,337/oz | Platinum $1,800/oz | Brent Crude $106.79