Where will iOCO go?

I’ve got a double-header of local tech names for you in Ghost Bites today, as well as some news from the mining, financial services and retail sectors.

Before we get to that, I’m excited to share the latest episode of The Finance Ghost plugged in with Capitec with you.

I have no doubt that many of you fantasise about ditching the day job and building something from scratch. Well, Lorraine Mekwa was brave (or crazy?) enough to leave not just any corporate job, but a divisional exco role at a listed financial services group!

She’s passionate about what she’s decided to go off and build. Earned Africa aims to connect businesses and highly skilled professionals in a way that solves the challenges and costs of traditional hiring processes.

It really is a fantastic discussion about taking risks and backing yourself. I strongly recommend making time for it at this link.

Looking for something you’ve read recently? This link has all the previous editions of Ghost Mail (and Ghost Mail Weekender). Share it with your friends and bring them into the community!

iOCO (JSE: IOC) is one of the local positions in my portfolio.

The share price has been flat in the past year despite the company giving the market encouraging guidance. But to be fair, the steady price since mid-2025 came after an immense rally that began in early 2024.

From my side, I can’t wait to see if the latest results give the share price some energy. The numbers were released after market close on Tuesday, so we need to wait for the trade activity this morning to see how the market feels.

For the year ended July 2026, iOCO grew revenue by a modest 3%. But as you work down the income statement, you’ll find numbers like 18% growth in EBITDA and 42% growth in HEPS.

This takes them to a double-digit EBITDA margin, which is an encouraging trend.

In case you’re wondering, the jump from EBITDA to HEPS was partially due to a 32% decrease in net finance costs.

HEPS of 57 cents means that yesterday’s closing share price (R3.85) is a Price/Earnings multiple of 6.8x. That’s not dirt cheap, but there aren’t many technology stocks trading at that kind of multiple. iOCO may not play in the sexiest parts of that value chain, but the numbers are heading in the right direction.

Speaking of the trajectory, the company has guided another year of growth in FY27. EBITDA of at least R680 million is expected, reflecting growth of at least 11.5% vs. reported EBITDA in FY26. The company also expects recurring revenue to be more than 60% of the total revenue base.

Bytes Technology (JSE: BYI) released results for the six months to August 2026. This was a much better period for top line growth, but it didn’t convert into earnings growth as effectively as investors might have liked.

Gross invoiced income jumped by 19.6% and revenue was up by 18.7%, so there’s still some pressure coming through in the relationship between those two metrics. Gross profit increased by 17.8%, giving us a 180-basis points gap between growth in gross invoiced income (what is billed to end users) and gross profit (what Bytes gets to keep).

In any given period, this can be due to mix effects, or pressure on the commission structures in the value chain. This is the unfortunate reality faced by resellers like Bytes.

The bigger challenge is that this growth came at a serious cost. Operating expenses increased by 24.7%, blunting the benefit of gross profit growth and leading to an increase in operating profit of only 6.6%.

This makes it an interesting set of numbers.

On one hand, there’s clearly an encouraging story here for sales to customers, with both the public sector and private sector showing excellent growth.

On the other, a 22.3% increase in employee costs despite only a 4% increase in average staff numbers shows that the incentivisation structure to achieve these numbers has been onerous. Other administrative expenses grew by 34%, so the overheads are also a concern.

Bytes had previously flagged this significant change in the cost base, so investors weren’t caught off-guard. But there is more pain to come, as the company expects costs to be weighted towards the second half of this financial year.

Operating profit is expected to grow in line with gross profit from FY28. They’ve even spoken about potential operating leverage thereafter. This makes Bytes an exercise in patience above all else.

But at least HEPS grew in this period, so the bottom-line result might not be too bad along the way.

Separately, Bytes announced the acquisition of CyberOne, a UK-based cybersecurity business. The business has been around since 2005 and operates in a market that is expected to continue its double-digit growth rate. Unlike the rest of Bytes at the moment, CyberOne has also been enjoying expanding gross profit margins.

The initial acquisition consideration of £19.4 million has been funded from existing cash resources. There may be further payments over the next 16 months depending on how the business performs. This works out to a Price/Sales multiple of 2.04x excluding any potential earn-out payments.

Bytes has been through a lot in recent years, so investors would no doubt appreciate a less choppy investment case and consistent execution:

Tharisa’s (JSE: THA) production report for the quarter and year ended September 2026 is out in the wild.

With a useful uptick in production from Q3 to Q4, the company ended the year on a high and managed to achieve PGM production in line with guidance. Annual production increased from 138.7 koz to 153.7 koz.

PGM prices dipped towards the end of the year, but looking at the full year average ($2,607/oz) vs. the prior year ($1,615/oz) is a reminder of just how strong this period has been for PGMs.

On the chrome side, annual production was in line with guidance and very slightly up on the prior year. Prices provided a useful boost, with an average metallurgical grade chrome concentrate price of $290/t for the year vs. $266/t in the prior year.

It was a busy period for the Karo Platinum project. A 25-year Special Mining Lease Agreement was signed with the Zimbabwe government. A five-year PGM concentrate purchase agreement was put in place with Valterra Platinum (JSE: VAL).

Alongside these milestones, Tharisa has invested a total of $240 million in capex at Karo Platinum (with a total estimated budget of $516 million). The project is fully funded by a senior secured bond, with the net proceeds placed in escrow.

The Tharisa Underground project is also quite the capex burden at the moment, but this is an important part of the company’s future.

The extent of development projects has taken the group from a net cash to a net debt position. They are doing what mining companies do: using a favourable point in the cycle to invest for the future.

Production guidance for the next financial year is between 150 and 170 koz in PGMs, reflecting growth at the midpoint. They expect 1.50 to 1.65 Mt in chrome concentrates, suggesting a flattish performance at the midpoint.

Ninety One (JSE: NY1 | JSE: N91) updated the market on its assets under management (AUM) as at 30 September 2026. The number came in at £181.4 billion, a dip from the £184.0 billion as at June 2026.

The important context is that this is much higher than £152.1 billion as at the end of September 2025. A large chunk of this increase is thanks to the transaction that Ninety One did with Sanlam Investment Management.

Just when you thought things couldn’t get any tougher for The Foschini Group (JSE: TFG), the company has now reported a cybersecurity incident at a few of the UK-based businesses.

At least TFG Africa and TFG Australia run on separate systems, so this issue has been contained to TFG London. It hasn’t spread to White Stuff, so I guess that tells us something about the lack of systems integration since that deal was done!

The affected stores are open and trading, but “several” of the IT systems remain unavailable. This kind of thing is exactly what TFG didn’t need right now.

And finally, a senior executive of Standard Bank (JSE: SBK) sold shares worth R4.2 million.

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.

US markets reversed much of the earlier session losses to close near the day's highs. Comments from Fed member Williams that only one further rate hike may be needed in 2026, and possibly none in 2027, helped drive the late rebound on Wall Street.

Financial sector earnings were mixed overnight, with BlackRock, Morgan Stanley and Bank of America among the big names reporting today.

Asian technology stocks have rebounded in early trade this morning and US futures are modestly firmer. Chinese producer prices rose at their fastest pace in more than four years in September, although consumer inflation came in below expectations.

Oil prices are firmer this morning following further attacks by Yemen's Iran-allied Houthis on Saudi Arabia, while Iranian officials have outlined new tactics to target shipping in the Strait of Hormuz.

The dollar index is flat after marginal weakness yesterday, as is the US 10 year yield. Today's US CPI print and the Fed's Beige Book are likely to guide short term direction for currencies and yields.

The rand is slightly firmer this morning and we expect the JSE All Share index to open flat to modestly higher, with markets likely to remain cautious ahead of this afternoon's US inflation data.

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 R16.46/$ | US 10yr 5.20% | Gold $4,156/oz | Platinum $1,673oz | Brent Crude $106.26