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Welcome to the Sharenet Daily Equity Report
 Issue: 02 March 2011 20:00

More on Berkshire

According to the book, The Money Masters, the original investors into Warren Buffet’s investing partnership would have turned $10 000 in 1956 into $300 000 by the time he dissolved in 1969. The original partnership saw him receive 25% of the profits above a 6% annual return on capital. On these numbers the approximate compounded annual return was 27,5%

Each year Buffett wrote to his co investors saying:

“I cannot promise results to partners, but I can and do promise this:

a. Our investments will be chosen on the basis of value, not popularity.

b. Our patterns of operations will attempt to reduce permanent capital loss (not short term quotational loss) to a minimum.”

When valuations became extremely stretched in 1969 and Buffett was unable to find bargains, he dissolved the partnership, giving investors back their capital plus their proportional share in Berkshire Hathaway which was one of the funds principal holdings and where Buffett was instated as chairman.

Three years later the stock market slumped and in the early to mid 1970’s Buffett via Berkshire was able to buy into a range of listed companies at good prices.

Now Berkshire’s listed stock holding has a book value of $33,7 billion and a market value of $61,5 billion. This includes 12,6% of American Express Company, 8,6% of Coca Cola and 10,5% of Munich Re.

Berkshire last added to their Coca Cola shares in 1995. It is carried at a book value of $1,3 billion (market cap of $13,1 billion). In that year they received $88 million in dividends. These dividends have increased each year and in 2011 they expect $376 million (+-2,8% dividend yield). Buffett is expecting this to double in 10 years.

Buffett recommends looking less at earnings per share than at return on capital when making assessment of value.

Long term interest rates indicate overall fair value levels.

An interesting point made in the book is that Buffett has a theory that the Dow Jones is worth ones times book value if you expect US Treasury Bills to yield an average of 11 percent in the future, 1,3 times if the expectation falls to 8,5% and close to twice if you expect Treasury Bills to yield 5%.

This essentially speaks to the discounting of future income streams at different interest rates where in a lower the interest rate environment, investors should be willing to pay more for businesses.

Looking at the book value of the S&P500 in the US, this has declined from over 4 times at its peak in March 2000 to now below 2 times, having dipped to below 1,5 times in 2009.

Right now 1 year treasury yields are exceptionally low. The 10 year US Treasury yields 3,4% and the 30 year 4,5%. While this is likely to pick up, at these levels Buffett says shares can be priced at twice book value and still be fair value.

if you wish to discuss your local and offshore investment planning, please do not hesitate to contact us.

Kind regards

Ian de Lange
021 9144 966

Wed, 02 Mar 2011

The rand broke through key resistance to hit a six-week high against the dollar on Wednesday, and spurred a rebound in South African bonds, as the dollar remained under selling pressure globally.  Full story
Forecast poor rains have dashed Uganda's hopes for a higher maize harvest this year with production expected to be unchanged from last year, a senior government official said on Wednesday.  Full story
Profit before taxation decreased from R15.9 million to R7.6 million in 2010.Profit attributable to ordinary shareholders decreased to R7.6 million (R15.9 million). Headline earnings per share increased to 1.5cps (0.8cps). Dividend No interim dividend was declared for the period under r  Full story
South African investment firm Brait will raise up to $864 million in a rights issue for its latest round of acquisitions, as it jettisons its private equity model in favour of public capital markets.  Full story

Copper output in Zambia, Africa's leading producer of the metal, increased by 60 percent in January as mining companies boosted production. . .  Full story
London Commodity Brokers (LCB) aims to sell 2 million tonnes of South African thermal coal a year for Strategic Natural Resources. . .  Full story
South Africa's new vehicle sales increased by 25.2 percent year-on-year in February to 49,164 units, the National Association of Automobile Manufacturers. . .  Full story
Total income increased to R316.5 million (2009: R310.3 million) for the interim period ended 31 December 2010. Profit from operations decreased. . .  Full story

Trading Statistics


Major Moves Up
SharenameSaleMove% MoveVolume
1 KELLY  4305013.16.%100
2 LITHA  265239.50.%2123420
3 TRNSHEX  285207.55.%25471
4 PNR-FOODS  57302995.51.%44418
5 BELL  1250494.08.%74597
6 HUGE  13054.00.%85095
7 DIAMONDCP  13054.00.%2000
8 GOLDONE  260104.00.%2478565
9 ONELOGIX  14553.57.%90800
10 BRIMST-N  600203.45.%1200
11 INVICTA  44001403.29.%3000
12 DELTA  825253.13.%9500
13 MAZOR  16042.56.%263783
14 SANLAM  2732642.40.%3344144
15 JSE  79261642.11.%83309
16 SASOL  376507251.96.%2570148
17 SACOIL  20841.96.%2140129
18 WESCOAL  10521.94.%200490
19 BLUETEL  570101.79.%421680
20 HULAMIN  795131.66.%59427

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Major Moves Down
SharenameSaleMove% MoveVolume
1 MMG  129-21-14.00.%9723
2 SOVFOOD  530-70-11.67.%125
3 DIGICOR  298-22-6.88.%3312
4 CARGO  1010-70-6.48.%1
5 AFRO-C  165-10-5.71.%39893
6 BRAIT  2076-124-5.64.%5512002
7 COAL  990-56-5.35.%87732
8 TREMATON  142-8-5.33.%54000
9 KAP  220-11-4.76.%108000
10 METROFILE  182-8-4.21.%147347
11 MIXTEL  125-5-3.85.%1000
12 KEATON   380-15-3.80.%7116
13 URONE  4468-168-3.62.%17568
14 AQUARIUS  4445-165-3.58.%602
15 PUTPROP  540-20-3.57.%108
16 MRHLD  2315-85-3.54.%3151201
17 DAWN  820-30-3.53.%103509
18 PPC  2650-96-3.50.%2354595
19 MONDIPLCP  6034-201-3.22.%1523979
20 RAUBEX  1872-62-3.21.%159974

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New Highs
SharenameSaleHighMove% MoveVolume
1 DIAMONDCP  13013054.00.%2000

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New Lows
SharenameSaleLowMove% MoveVolume
1 PPC  26502636-96-3.50.%2354595
2 GROUP-5  27562750-64-2.27.%267720
3 BASREAD  10241010-19-1.82.%329512
4 AFROX  17951780-4-0.22.%418182

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Spot Prices
NameTimeRPMove% Move
JSE Overall17:0031973.09-77.64-0.24%
JSE Top 4017:0028826.44-45.35-0.16%
JSE Gold17:002758.38-4.45-0.16%
JSE Financial17:0021046.47-58.36-0.28%
JSE Industrial17:0031318.51-123.23-0.39%
JSE Indust 2517:0026176.45-78.98-0.30%
JSE Resource17:0058247.15-47.88-0.08%
DJ Futures19:5612045.0023.000.19%
DJ Ind19:4512079.4021.380.18%
SP 50019:301307.190.860.07%
FTSE 10018:355914.89-20.87-0.35%
All Ords07:404898.30-22.10-0.45%
NZSE 5006:263381.99-2.40-0.07%
NameTimeRPMove% Move
Gold/R kg20:00317675-1800-0.56%
Brent Crude19:56116.232.271.99%
Rand / Dollar19:586.8770-0.1086-1.55%
Rand / Pound19:5511.1863-0.1532-1.35%
Rand / Euro19:559.5311-0.1005-1.04%
Rand / NZD19:575.1163-0.1035-1.98%
Rand / AUD19:556.9900-0.0953-1.35%
Yen / Dollar19:5381.6500-0.2400-0.29%
Euro / Dollar19:550.7208-0.0048-0.66%
Dollar / Euro19:571.38680.00910.66%
Pound / Dollar19:550.6124-0.0021-0.34%

Click here for the Sharenet Spot Price page
Index Summary
Index NameRPMove% Move
Top 4028,826.44-45.35-0.16%
Mid Cap40,734.26-302.51-0.74%
Small Cap31,891.39-235.10-0.73%
Resource 2058,247.15-47.88-0.08%
Industrial 2526,176.45-78.98-0.30%
Financial 157,961.10-16.47-0.21%
Financial & Ind. 3029,412.82-73.32-0.25%
All Share31,973.09-77.64-0.24%
Oil & Gas 28,554.08549.841.96%
Mining 38,203.41-146.11-0.38%
Gold Mining2,758.38-4.45-0.16%
Platinum Mining76.63-.36-0.47%
Oil & Gas Producers 15,353.00295.641.96%
Basic Materials 32,122.27-142.89-0.44%
Chemicals 13,341.43-56.85-0.42%
Forestry & Paper 13,811.56-317.54-2.25%
Industrial Metals 30,108.58-162.34-0.54%
Industrials 27,556.36-54.44-0.20%
General Industrials 76,806.26472.130.62%
Consumer Goods 25,787.98-291.52-1.12%
Automobiles & Parts 2,943.802.270.08%
Household Goods154.11-2-1.46%
Health Care 31,049.16-348.60-1.11%
Beverages 79,282.22-1073.00-1.34%
Food Producers 46,836.17-389.34-0.82%
Index NameRPMove% Move
Personal Goods 401.00-3.50-0.87%
Consumer Services 52,896.98148.720.28%
General Retailers 38,873.8013.200.03%
Travel & Leisure 3,828.75-71.92-1.84%
Media 87,789.96443.530.51%
Support Services 2,485.95-46.88-1.85%
Telecommunications 60,606.74380.080.63%
Financials 21,046.47-58.36-0.28%
Banks 38,891.9420.760.05%
Non-life Insurance 31,097.04227.940.74%
Life Insurance 15,825.66-124.85-0.78%
General Financial 2,271.33-12.80-0.56%
Technology 20,509.73-49.79-0.24%
SHARIAH TOP40 3,275.64-3-0.08%
FTSE/JSE SHARIAH ALL3,323.29-4-0.12%
COAL MINING21,453.252321.09%
FTSE JSE Fledgling 4,638.20-38-0.80%
FTSE/JSE Alt X 1,021.73-2-0.20%
CAPPED PROPERTY 303.74-0.34%
RESOURCE 32,048.47-26-0.08%
DIVIDEND PLUS163.36-1-0.77%
FTSE/JSE RAFI 406,695.50-17-0.26%
Capped Top 4014,948.60-20-0.14%
Capped All Share16,060.21-40-0.25%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
03 Mar 2011ASPENDecember 2010 (Interim)
03 Mar 2011ASPENPREFDecember 2010 (Interim)
03 Mar 2011HYPROPDecember 2010 (Final)
03 Mar 2011METROFILEDecember 2010 (Interim)
03 Mar 2011O-LINEDecember 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
RACRACEC Group Ltd03/03/2011Confirmed
DONThe Don Group Ltd03/03/2011Confirmed
PCNPParacon Holdings Ltd08/03/2011Confirmed
PCNParacon Holdings Ltd08/03/2011Confirmed
QPGQuantum Property Group Ltd08/03/2011Confirmed

Stock Exchange News Service
02/03/201117:30GEN - Rand Merchant Insurance Holdings Ltd (South Africa) - Unbundling from RMB
02/03/201117:23 Super Group Limited - Grants to and acceptances of options
02/03/201117:17 Freeworld Coatings Limited - Application by Kansai Paint Co., Ltd
02/03/201117:15 Old Mutual plc - Notification of Transactions
02/03/201117:00 Keaton Energy Holdings Limited - Sale of shares by Rutendo Holdings
02/03/201117:00 African Rainbow Minerals Limited - Director`s dealings in ARM securities
02/03/201116:45 Wearne - Update announcement relating to the Section 311 Schemes Of
02/03/201116:00 Merafe Resources Limited - Changes to the board of directors
02/03/201116:00BRT/BRN - Brimstone Investment Corporation Limited - Voluntary Announcement
02/03/201115:56NAI / NAN - New Africa Investments Limited - Unaudited interim results of the
02/03/201115:54 Gold Reef Resorts Limited - Trading Statement
02/03/201115:19 Zaptronix Limited - No change statement and notice of annual general
02/03/201114:44 Village - Abridged Revised Listing Particulars, 2 March 2011
02/03/201114:42 Simmers - Posting of Circular to Simmers Shareholders in respect of the
02/03/201114:41 Exxaro - Dealings by a director of a major subsidiary of Exxaro
02/03/201114:40 Village - Posting of Circular and Revised Listing Particulars
02/03/201113:50 Primeserv Group Limited - Cautionary announcement
02/03/201112:48ABL/ABLP - African Bank Investments Limited - Appointment of non-executive
02/03/201112:47VN - Sabvest Limited - Condensed audited results for the year ended 31
02/03/201112:35 AngloGold Ashanti Limited - Granting of options to directors and company
02/03/201112:22 ARB Holdings Limited - Dealing in securities by an associate of directors
02/03/201112:18SCIB/TOPSKF - The Standard Bank Of South Africa Limited - Notice of expiry of
02/03/201112:00 SABMiller Plc - Change in particulars of directors
02/03/201111:53SCIB/KIOSTE - The Standard Bank Of South Africa Limited - Dividend announcement
02/03/201111:50MND/MNP - Mondi Limited/Mondi Plc - Transactions in Mondi Limited ordinary
02/03/201111:45 Tawana Resources NL - Results of General Meeting
02/03/201111:10THEE - Competition Commission refers pilings cartel case to the Competition
02/03/201111:00ART - Africa Cellular Towers Limited - Appointment of financial director
02/03/201110:51SIL - Wilderness Holdings Limited - Re-Structuring of Wilderness Holdings
02/03/201110:32 Nedbank Group Limited - Dealings in Securities by Executive Director
02/03/201110:31 Resource Generation Limited - Resource Generation Limited Broadcast
02/03/201110:28 Hudaco Industries Limited - Fulfillment of conditions precedent
02/03/201110:23FFA/FFB - Fortress Income Fund Limited - Dealing in securities
02/03/201110:00 Cafca Limited - Audited Financial Results: Full Year Ended 31 December
02/03/201110:00SFN/SFNP - Sasfin Holdings Limited - Unaudited results and dividend declarations
02/03/201109:44 Bell Equipment Limited - Revised trading statement
02/03/201109:37 Spur Corporation Limited - Appointment of lead independent director
02/03/201109:05SCIB/KIOSTE - The Standard Bank Of South Africa Limited - Issue of Share
02/03/201109:00CCO - Capital & Counties Properties PLC - Audited preliminary results for the
02/03/201108:38 Consolidated Infrastructure Group Limited - Dealing in securities
02/03/201108:37 Consolidated Infrastructure Group Limited - Dealing In Securities
02/03/201108:31 Firestone Energy Limited - Significant Metallurgical Coal - Confirmed in
02/03/201108:30 m Cubed Holdings Limited - Resignation of financial director and change
02/03/201108:12 Ububele Holdings Limited - Interim results for the six months ended 31
02/03/201108:00 FirstRand Limited - Further trading statement-impact of unbundling of
02/03/201107:30 Petmin Limited - Condensed Consolidated Interim Financial Statements for
02/03/201107:25 First Uranium Corporation - First Uranium Corporation Closes $52,000,000
02/03/201107:16 BRAIT S.A.,Societe Anonyme - Brait announces a R6BN capital raising,
02/03/201107:15 BRAIT S.A. - Detailed terms announcement
02/03/201107:15 Hyprop Investments Limited - Audited results for the year ended
02/03/201107:10 British American Tobacco p.l.c. - Transaction in own shares
02/03/201107:05 BHP Billiton Plc - Transaction in shares
02/03/201107:05 Omnia Holdings Limited - BME Losberg Cartridge Production Plant Explosion
02/03/201107:05 Petmin Limited - Petmin appointment and resignation of non-executive
02/03/201107:05 Premium Properties Limited - Dealing in securities by directors pursuant
02/03/201107:05SOL - Sasol Limited - Sasol announces the completion of the Acquisition of a 50%
02/03/201107:05 AFGRI Limited - Unaudited condensed consolidated financial results for

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