COMPANY NEWS IN BRIEF
OUTsurance rallies amid bumper earnings, special dividendShares of OUTsurance rallied more almost 9% on Monday after the multinational property and casualty insurer upped its dividend almost 30% and also declared a special dividend thanks to bumper earnings and the release of some surplus funds.
The group, whose operations span SA, Australia, and Ireland, reported that headline earnings, which excludes certain one-off items, rose 19% to R3.53 billion in the year ended June.
The group declared a final dividend of R113.2c per share, taking its full-year shareholder distribution to 174.4c, up 29.4%, and in afternoon trade, the group was up 8.8%, valuing it at over R85 billion on the JSE.
OUTsurance said the higher dividend was supported by its robust earnings performance along with the resumption of dividend payments from its life business and a reduction in uncertainty in reinsurance markets.
It also declared a special dividend of 40c per share thanks to the release of surplus funds held in RMI Treasury Co., which houses legacy venture capital investments of the group's former parent holding company.
Marthinus Visser, OUTsurance group CEO, said the group's strong earnings performance benefitted from tailwinds provided by ongoing premium inflation, higher investment income from improving financial markets, and robust new business growth.
-FIN24-
Grindrod takes full control of Maputo coal and magnetite terminal for R1.3bn
Freight and logistics group Grindrod announced it had reached a $77 million (R1.35 billion) deal to acquire the 35% it does not already own of the Terminal de Carvão da Matola (TCM), which owns a dry bulk terminal in Maputo.
TCM had delivered record volumes in the group's 2023 year, and primarily transports coal and magnetite, both important for steelmaking, with a capacity of 7 million tonnes per annum.
TCM is operated under a sub-concession to the Maputo Port Development Company's main port concession and has the capacity to receive cargo by rail and road with its own dedicated export berth.
"TCM's long-term sub-concession is a strategic asset enabling Grindrod to provide cost-effective and efficient integrated logistics solutions for its customers' cargo flows," the company said in a statement. "Through this asset, Grindrod will unlock its value creation across the Maputo corridor and meaningfully drive its pit-to-port solution for its customers."
Valued at about R11 billion on the JSE Grindrod also operates terminals in Richards Bay, Durban and Walvis Bay, with the group reporting a total drybulk capacity of about 17 million tonnes for 2023.
-FIN24-
SA unit trust investors yanked R14bn from foreign portfolios in a year, says Asisa
South African unit trust investors pulled a combined R13.8 billion from locally registered foreign portfolios in the past year.
This is according to data released by the Association for Savings and Investment SA (Asisa) on Tuesday, which shows that locally registered foreign portfolios recorded net outflows of R2.4 billion in the second quarter, taking total net outflows for the 12-month period to end-June to R13.8 billion.
The 698 foreign currency-denominated portfolios available in SA also saw their assets under management (AUM) decline to R899 billion from R928 billion.
In total, the entire local collective investment scheme (CIS), or unit trust, industry had assets of R3.64 trillion at the end of June, which represented 2% growth from the end of the prior quarter and 8.3% over the preceding 12 months.
Asisa said this increase in AUM was driven primarily by the performance of financial markets.
Even so, the local CIS industry recorded net outflows of R30 billion, excluding reinvestments, in the second quarter of 2024.
After factoring in the R24 billion in reinvestments of dividends and interest by existing investors, net outflows declined to R6 billion for the three months to end-June.
Portfolios can see their AUM rise even as they record net outflows if a positive financial market performance offsets withdrawals.
-FIN24-
Rand firms ahead of expected US rate cut, South African inflation data
The rand firmed on Wednesday ahead of an expected U.S. Federal Reserve interest rate cut and South African inflation data.
At 0702 GMT, the rand traded at 17.5625 against the dollar , about 0.2% firmer than its previous close.
Markets are certain the Fed will cut rates when it makes its policy announcement on Wednesday and bets are on a 50-basis-point (bp) interest rate cut in the world's biggest economy.
"The risk to the market is that the Fed only cuts rates 25bp and throws a cat amongst the pigeons," said ETM Analytics in a research note.
"A conservative 25bp rate cut would change the trajectory of the rate cuts priced in, leading to an unwinding of some trading positions and might spark a sell-off in the rand."
Like other risk-sensitive currencies, the rand often takes cues from global drivers like U.S. monetary policy in addition to domestic data points.
Local investors will look to consumer inflation data for August (ZACPIY=ECI), opens new tab on Wednesday. Analysts polled by Reuters forecast annual inflation of 4.5% last month from 4.6% in July, and at the midpoint of the central bank's 3% to 6% target range.
-REUTERS-