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Welcome to the Sharenet Daily Equity Report
 Issue: 01 March 2011 20:00

Warren Buffet's annual report

Warren Buffet always makes some good points in his annual shareholder letter accompanying the financial results of the listed company that he controls – Berkshire Hathaway. It is a widely followed letter with Buffett as the largest shareholder being one of the richest men in the world.

Berkshire is a company with a market cap of approximately $216 billion.

Buffett took control of the company in 1965. Over the 46 years the book value of the company has compounded from $19 to $95 453, an annual rate of 20,2%. He measures this book value increase against the compounded increase in the S&P500 index, which over the same period has compounded by 9,4% per annum.

Berkshire Hathaway was originally a textile operating company. Now the company that Warren Buffett controls is essentially a holding company into a range of underlying investments and operating businesses. It is not necessarily unique because it is essentially a closed end investment company that invests into a range of underlying operating businesses. But it is unique in terms of its sheer scale.

In order to have full access to the operating businesses cash flows, Berkshire prefers to own its subsidiaries outright.

Some of his comments from the report

“Money will always flow toward opportunity, and there is an abundance of that in America. Commentators today often talk of “great uncertainty.” But think back, for example, to December 6, 1941, October 18, 1987 and September 10, 2001. No matter how serene today may be, tomorrow is always uncertain.”

He goes on to say that politicians and pundits have constantly moaned about terrifying problems facing America, yet its citizens live 6 times better off than when he was born some 80 years ago.

His enthusiasm for America when most others were negative 2 years back, led him to conclude one of their biggest deals in 2010 – the acquisition of Burlington Northern Sante Fe for $26 billion. This is the second largest railroad business in the US.

He notes in his report on this railway operation that, “Last year BNSF moved each ton of freight it carried a record 500 miles on a single gallon of diesel fuel. That’s three times more fuel-efficient than trucking is, which means our railroad owns an important advantage in operating costs.”

On performance goals

“Charlie and I believe that those entrusted with handling the funds of others should establish performance goals at the onset of their stewardship. Lacking such standards, managements are tempted to shoot the arrow of performance and then paint the bull’s-eye around wherever it lands.”

On their dividend policy

“..not a dime of cash has left Berkshire for dividends or share repurchases during the past 40 years. Instead, we have retained all of our earnings to strengthen our business, a reinforcement now running about $1 billion per month. Our net worth has thus increased from $48 million to $157 billion during those four decades..”

Buffett knows that he needs to continue to do large deals because the job gets more difficult as the numbers get larger. The company will need both good performance and major acquisitions.

I will look at a few more points on this large conglomerate tomorrow.

Kind regards

Ian de Lange
021 9144 966

Tue, 01 Mar 2011

India bought 1.5 million tonnes of thermal coal from South Africa in January, 34 percent of its total exports of 4.4 million tonnes but down from 2 million tonnes in December, exporters said.  Full story
Ghana joined the club of oil-producing nations in December, offering it the chance to transform the fortunes of its aid-dependent economy.  Full story
Japan's Kansai Paint could consider cutting its stake in South Africa's Freeworld Coatings in order to keep the company listed in Johannesburg, a senior executive said on Tuesday.  Full story
Boosted by the soccer World Cup, South Africa saw a record 15.1 percent increase in tourist arrivals in 2010 although the total of more than 8 million was not an all time-high, the tourism minister said on Tuesday.  Full story

South African government bonds retreated in listless trading on Tuesday with the market still seeking pointers on the Treasury's issuance plans. . .  Full story
Brewer SABMiller is to spend over $100 million to build a new brewery in Africa's second largest beer market Nigeria to. . .  Full story
South Africa has allocated 750 million rand to assist farmers affected by floods and drought in some parts of the country,. . .  Full story
Mobile phone operator MTN Zambia plans to invest $150 million in network upgrades and expansion to capture 35-37 percent of the. . .  Full story

Trading Statistics


Major Moves Up
SharenameSaleMove% MoveVolume
1 WITSGOLD  54504509.00.%380
2 PBT  11865.36.%134971
3 CLIENTELE  1000505.26.%113
4 AVUSA  2190994.73.%59686
5 METAIR  1299584.67.%48210
6 GBGOLD  1890804.42.%16000
7 SACOIL  20484.08.%3729278
8 TRENCOR  36401404.00.%94618
9 MAZOR  15664.00.%15100
10 CML  1721663.99.%290997
11 COAL  1046383.77.%83993
12 ADCORP  28001003.70.%105670
13 AFRIMAT  340103.03.%7971
14 AFRO-C  17552.94.%5262
15 KAP  23162.67.%25675
16 PNR-FOODS  54311312.47.%114818
17 ELLIES   21552.38.%215071
18 JSE  77621632.15.%212280
19 SENTULA  29062.11.%405000
20 MAS  975202.09.%1454

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Major Moves Down
SharenameSaleMove% MoveVolume
1 RA-HOLD  350-75-17.65.%600
2 ILIAD  750-75-9.09.%211176
3 JASCO  120-10-7.69.%18129
4 ARB  333-25-6.98.%13634
5 HUGE  125-8-6.02.%80500
6 ROLFES  175-10-5.41.%1670
7 PHUMELELA  1095-55-4.78.%3450
8 ARGENT  860-40-4.44.%57418
9 MRHLD  2400-100-4.00.%1666676
10 ONELOGIX  140-5-3.45.%140062
11 PIKWIK  1939-68-3.39.%250457
12 ALTRON-P  2510-80-3.09.%138606
13 SASOL  36925-1172-3.08.%2265869
14 DELTA  800-25-3.03.%5000
15 ESORFRANK  175-5-2.78.%144131
16 AFROX  1799-50-2.70.%218472
17 HOWDEN  1047-28-2.60.%144
18 REMGRO  10920-275-2.46.%2293923
19 JUBILEE  320-8-2.44.%132600
20 TONGAAT  10140-250-2.41.%109598

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New Highs
SharenameSaleHighMove% MoveVolume
1 MONDILTDP  61706444-30-0.48.%225437

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New Lows
SharenameSaleLowMove% MoveVolume
1 DELTA  800800-25-3.03.%5000
2 AFROX  17991799-50-2.70.%218472
3 BASREAD  10431030-8-0.76.%364294
4 WITSGOLD  545047504509.00.%380

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Spot Prices
NameTimeRPMove% Move
JSE Overall17:0032050.73-221.36-0.69%
JSE Top 4017:0028871.79-206.04-0.71%
JSE Gold17:002762.83-2.98-0.11%
JSE Financial17:0021104.83-104.93-0.49%
JSE Industrial17:0031441.74-84.45-0.27%
JSE Indust 2517:0026255.43-46.61-0.18%
JSE Resource17:0058295.03-692.85-1.17%
DJ Futures19:5012119.00-95.00-0.78%
DJ Ind19:2512143.01-83.33-0.68%
SP 50019:461316.51-10.71-0.81%
FTSE 10018:355935.76-58.25-0.97%
All Ords07:384920.40-2.20-0.04%
NZSE 5006:263384.3913.870.41%
NameTimeRPMove% Move
Gold/R kg19:5631981240351.28%
Brent Crude19:56113.731.741.55%
Rand / Dollar19:596.96720.00730.10%
Rand / Pound19:5511.31120.01960.17%
Rand / Euro19:559.61980.00740.08%
Rand / NZD19:585.2261-0.0116-0.22%
Rand / AUD19:557.0853-0.0077-0.11%
Yen / Dollar19:5781.86000.10000.12%
Euro / Dollar19:550.72430.00040.06%
Dollar / Euro19:581.3800-0.0007-0.05%
Pound / Dollar19:550.6142-0.0003-0.05%

Click here for the Sharenet Spot Price page
Index Summary
Index NameRPMove% Move
Top 4028,871.79-206.04-0.71%
Mid Cap41,036.77-259.71-0.63%
Small Cap32,126.49-31.22-0.10%
Resource 2058,295.03-692.85-1.17%
Industrial 2526,255.43-46.61-0.18%
Financial 157,977.57-52.07-0.65%
Financial & Ind. 3029,486.14-81.43-0.28%
All Share32,050.73-221.36-0.69%
Oil & Gas 28,004.24-883.46-3.06%
Mining 38,349.52-344.55-0.89%
Gold Mining2,762.83-2.98-0.11%
Platinum Mining76.99-.74-0.95%
Oil & Gas Producers 15,057.36-475.02-3.06%
Basic Materials 32,265.16-293.71-0.90%
Chemicals 13,398.28-85.45-0.63%
Forestry & Paper 14,129.10-144.89-1.02%
Industrial Metals 30,270.92-346.58-1.13%
Industrials 27,610.80-456.60-1.63%
General Industrials 76,334.13-1433.60-1.84%
Consumer Goods 26,079.50151.650.58%
Automobiles & Parts 2,941.53131.344.67%
Household Goods156.40-1-0.60%
Health Care 31,397.76-197.37-0.62%
Beverages 80,355.22184.530.23%
Food Producers 47,225.51-224.19-0.47%
Index NameRPMove% Move
Personal Goods 404.506.491.63%
Consumer Services 52,748.26-154.16-0.29%
General Retailers 38,860.60117.790.30%
Travel & Leisure 3,900.6714.560.37%
Media 87,346.43-565.90-0.64%
Support Services 2,532.83-28.09-1.10%
Telecommunications 60,226.66-180.25-0.30%
Financials 21,104.83-104.93-0.49%
Banks 38,871.18-315.09-0.80%
Non-life Insurance 30,869.10-160.04-0.52%
Life Insurance 15,950.51-67.38-0.42%
General Financial 2,284.134.550.20%
Technology 20,559.52-232.55-1.12%
SHARIAH TOP40 3,278.28-34-1.02%
FTSE/JSE SHARIAH ALL3,327.14-35-1.04%
COAL MINING21,221.10-235-1.10%
FTSE JSE Fledgling 4,675.76180.39%
FTSE/JSE Alt X 1,023.76-16-1.50%
CAPPED PROPERTY 304.79-0.19%
RESOURCE 32,074.59-381-1.17%
DIVIDEND PLUS164.63-1-0.56%
FTSE/JSE RAFI 406,712.85-59-0.87%
Capped Top 4014,968.98-100-0.67%
Capped All Share16,099.71-108-0.67%

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Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
02 Mar 2011CAPCODecember 2010 (Final)
02 Mar 2011FIURANIUMDecember 2010 (Q)
02 Mar 2011MERAFEDecember 2010 (Final)
02 Mar 2011PETMINDecember 2010 (Interim)
03 Mar 2011ASPENDecember 2010 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
EXXARO11-02-2411-04-0111-04-11R 3.0000
GRINDROD PREF11-02-2411-03-1111-03-22R 3.8600
GRINDROD11-02-2411-03-1111-03-22R 0.2700
LIB-HOLD11-02-2411-03-1711-03-28R 2.9100
BATS11-02-2411-03-0411-05-05R 0.8100
Ex Div**
Share NameDec-DateLDTPay-DateAmount

Upcoming AGMs**
CodeCompany NameDateStatus
GMBGlenrand MIB Ltd01/03/2011Confirmed
ASOAustro Group Ltd01/03/2011Confirmed
GMBPGlenrand MIB Ltd01/03/2011Confirmed
DONThe Don Group Ltd03/03/2011Confirmed
RACRACEC Group Ltd03/03/2011Confirmed

Stock Exchange News Service
01/03/201117:35GEN - FTSE/JSE Africa Index Series - Premium Properties Ltd (South Africa):
01/03/201117:34 Anglo American plc - Director`s interests
01/03/201117:26GEN - FTSE/JSE Africa Index Series - Village Main Reef Gold Mining Co. (South
01/03/201117:25BAW/BAWP - Barloworld Limited - Allocation of forfeitable shares
01/03/201117:25 Old Mutual plc - Form 8.3
01/03/201117:24 Grand Parade Investments Limited - Trading Statement
01/03/201116:37 Quantum Property Group Limited - Dealings in securities by director
01/03/201116:30 The Foschini Group Ltd - Company secretary Dealing in Securities
01/03/201116:23 Glenrand M I B LIMITED - Results of scheme meeting
01/03/201116:00 Platmin extends convertible debentures
01/03/201115:53 Anglo Platinum Limited - No change statement and notice of annual general
01/03/201115:50PGFP - PSG Financial Services Limited - Declaration of preference share dividend
01/03/201115:38 Ingenuity Property Investments Limited - Dealing in securities by a
01/03/201115:25 changes in the Infrasors board
01/03/201115:12 ISA Holdings Limited - Change in director`s indirect shareholding
01/03/201115:01 Lonmin Plc - Total Voting Rights and Capital as at 28 February 2011
01/03/201114:45SHF - Steinhoff International Holdings Limited - Unaudited interim results for
01/03/201114:30 Anglo American plc - Director`s interests
01/03/201114:00 AFGRI Limited - Cautionary announcement relating to the potential
01/03/201114:00 Santam Limited - Audited abridged financial report for the year ended 31
01/03/201114:00 British American Tobacco p.l.c. - Voting Rights and Capital
01/03/201114:00 African Eagle Resources Plc - Change of adviser
01/03/201113:53FFA/FFB - Fortress Income Fund Limited - Dealing in securities
01/03/201113:47 Aveng Limited - Trading Statement and update on Competition related
01/03/201113:31 Exxaro Resources Limited - Trading of Exxaro ordinary shares on behalf of
01/03/201113:25 Glenrand MIB Limited - Results of the annual general meeting and changes
01/03/201113:00 Sabmiller Plc - Director/PDMR Shareholding
01/03/201112:51 Anglo American plc - Total voting rights
01/03/201112:45 Compu-Clearing - Renewal of cautionary announcement
01/03/201112:28 PBT Group Limited - Changes to the board of directors
01/03/201112:02 Huge Group Limited - Director`s dealings in securities
01/03/201111:54 Workforce Holdings Limited - Further Cautionary Announcement
01/03/201111:13 O-line Holdings Limited - Unaudited interim results for the six months
01/03/201110:10CUL/CULP - Cullinan Holdings Limited - Results of Annual General Meeting
01/03/201109:37 Lonrho Plc - Director`s Dealing
01/03/201109:37- Coal of Africa Limited - Makhado Project new order mining right
01/03/201109:36SOV/SOVN - Sovereign Food Investments Limited - Director`s dealings in
01/03/201109:22 Lonrho Plc - Total Voting Rights
01/03/201109:16 BHP Billiton Plc - Total voting rights and capital
01/03/201109:00 African Eagle Resources Plc - Whittle optimisation report, Dutwa Nickel
01/03/201108:29 SacOil Holdings Limited - SacOil agrees second Nigerian short-term Oil and
01/03/201108:00GLD - NewGold - Partial De-Listing of Newgold Debentures
01/03/201108:00 KAP International Holdings Limited - Unaudited Group Results for the
01/03/201108:00 Merafe - Audited abridged results and dividend announcement for the year
01/03/201108:00 Village - Merensky Reef discovered at a depth of only 590m at Village`s
01/03/201107:30 South Ocean - Audited abridged results announcement for the year ended 31
01/03/201107:07 BHP Billiton Plc - Transaction in shares
01/03/201107:06 Metorex - Pro Forma Income Statement for the 6 months ended 30 June 2010
01/03/201107:05SOV/SOVN - Sovereign Food Investments Limited - Directors` dealings in
01/03/201107:05 Metorex - Provisional reviewed results for the period ended 31 December
01/03/201107:05 London Finance & Investment Group P.L.C. - Unaudited interim results for

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