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 The Sharenet Daily 
Thursday, 01 September 2011 - 20:00
Top News
SA Business
Company News
Company Results
World Markets (Spot Prices)
JSE Today
JSE Trading Statistics
Major Moves
Index Summary
Latest Consensus Changes / Results Expected
Recent Dividends / Ex Div
Upcoming AGMs
Stock Exchange News Service (SENS)

Discovery releases annual results

Discovery is a company known in South Africa for its health and risk financial products. The company was founded by its ceo, Adrian Gore, now 46, in 1992. Year on year it continues to impress the market with its innovation and with its financial performance.

In a trading statement issued on the 24 August, the company said that normalised headline earnings were expected to increase by between 25% and 35% over the previous year.

The June 2011 results revealed an increase of 31% to 365,8 cents per share. The consensus forecast has this increasing to 431c next year, putting the current price on a forward PE (price to earnings) of 9,1 times.

The company has calculated an embedded value – the equivalent to the net asset value – at R48,45/ share up 19% year on year. The share price is trading at R39,15 and therefore a discount. The price did trade over R40 at the end of 2011, but has largely moved sideways for 2011 in line with the overall market.

The business has the health and life as the key profit generators, while at the same time it is expanding into new areas including Discovery Invest, Insure, Prudential joint ventures and its Vitality business.

• Discovery Health grew operating profits by 14% to R1,35 billion and with total medical scheme membership increasing by 6% to 2,5 million lives.

• Discovery Life has been an excellent business unit, with profits increasing by 16% to R1,6 billion

• Discovery Invest is a relative new business unit, but has turned into profitability generating R101 million with assets under management exceeding R17,2 billion.

PruHealth is Discovery’s joint venture business in the UK. During the year it acquired Standard Life Healthcare, the UK’s fourth largest assurer. By contributing this to the joint venture, Discovery’s stake has increased in both PruHealth and PruProtect from 50% to 75%.

Discovery has a joint venture in China called Ping An Health. Although still very early, this company administers a total of 300 000 lives.

The company remains on a definite growth path with the following major acquisitions and new launches:

• At the beginning of the financial year, Discovery acquired Standard Life Healthcare.
• Concluded a joint venture with US health insurer, Humana and launched HumanaVitality.
• It launched the short term operation – Discovery Insure.

The company mentioned that its Vitality is the underpin to Discovery’s performance, saying that with Vitality they can make better selection, more accurate pricing, etc., which assists with the product development. The model is being used for the new Discovery Insure, where they will apply the principles of behavioural economics to the science of driving and linking this with premiums.

Discovery had the early backing of the RMB group. With the more recent restructuring of the Momentum group and the separation of FirstRand, the company RMI Holdings was listed on the JSE on the 7 March 2011. This company owns 25% of Discovery, 24,4% of the new MMI Holdings (merger of Momentum and Metropolitan) and 83% of Outsurance. This is a way to access 3 life businesses through one share.

This is definitely a growth business, but remains a complex business with many moving parts. At face value it does appear to be good value. On a dividend yield basis it however trades at a premium to the market. The market did appreciate the results, taking the price up over 3% higher towards the end of the day.

Kind regards

Ian de Lange
021 9144 966

Thu, 01 Sep 2011
Top News
Commodity trading giant Glencore confirmed on Thursday that it aims to take a controlling stake in South African coal miner Optimum Coal Holdings with its local partner, prominent local politician-turned tycoon Cyril Ramaphosa.  Full story

Revenue increased marginally to R121 000 (R120 000) and gross profit was recorded at R22 000 (loss of R24 000). Operating loss amounted to R1 800 000 (profit of R250 000), while total loss for the period attributable to equity holders of the company was at R1 741 000 (profit of R133 000). Mo  Full story
Muammar Gaddafi, driven into hiding by his foes, on Thursday urged his supporters to fight on, even as Libya's new interim rulers met world leaders to discuss reshaping a nation torn by 42 years of one-man rule and six months of war.  Full story
Two Kenyan politicians and a radio presenter meticulously planned and organised attacks on civilians to unleash a wave of violence after Kenya's disputed 2007 election, the war crimes court heard on Thursday.  Full story
France's Socialists are distancing themselves from Dominique Strauss-Kahn as the ex-IMF chief, once their best-placed presidential contender but now dogged by sex assault accusations, prepares to return from the United States.  Full story
SA Business
Democratic Republic of Congo has confirmed to France Telecom that it is the sole bidder for the government's 49 percent stake. . .  Full story
Royal Dutch Shell (RDSa.L) said on Thursday it hoped to invest $200 million to explore for shale gas in South Africa's. . .  Full story
Namakwa Diamonds, in the midst of a strategic review, said it was in advanced talks to sell its mining business in. . .  Full story
. . .  Full story

Commodity trading giant Glencore confirmed on Thursday that it aims to take a controlling stake in South African coal miner Optimum Coal Holdings with. . .  Full story
South Africa's bonds firmed across the curve on Thursday after PMI data showed the manufacturing sector contracted for the second month. . .  Full story
A subsidiary of Marsh & McLennan has acquired the brokerage business of South Africa's Alexander Forbes in 11 African countries for. . .  Full story
France said on Thursday it had U.N. approval to release around a third of its frozen Libyan assets to help rebuild the country.. . .  Full story

South Africa's National Union of Mineworkers (NUM) said on Thursday it had reached a two-year wage deal with ALS, a contractor. . .  Full story
South African trade union Solidarity said on Thursday it would seek a Labour Court injunction to block planned lay-offs at Absa. . .  Full story
South Africa's Purchasing Managers' Index rose to a seasonally adjusted 46.7 in August from a two-year low of 44.2 in July,. . .  Full story
. . .  Full story
Company News
Cadiz Special Projects Ltd, a wholly owned subsidiary of Cadiz, reached agreement with Makana Investment Corporation (Pty) Ltd ("Makana") to redeem. . .  Full story
Shareholders were advised that the company's annual financial statements for the year ended 28 February 2011 were posted to shareholders on. . .  Full story
Further to the cautionary announcement published on Friday, 26 August 2011 by Optimum, shareholders of Optimum were advised that a consortium. . .  Full story
Shareholders are advised that at the special general meeting of ordinary shareholders held today, Thursday 1 September 2011, special resolutions number. . .  Full story

Shareholders are hereby advised that the requisite majority of shareholders approved all ordinary and special resolutions tabled at the annual general. . .  Full story
The JSE advised that Pinpoint has failed to submit their annual reports within the six-month period stipulated in the JSE's Listings. . .  Full story
Business Day reported that Anglo has been caught napping as potential Australian target Macarthur Coal recommened an improved AUD4.9 billion takeover. . .  Full story
The board of directors of Erbacon hereby notified its shareholders that Mr. Coenie Vermaak ("Coenie") has been appointed as an executive. . .  Full story
Company Results
Sales increased to R14.9 billion (R11 billion). Gross profit rose to R5.9 billion (R3.5 billion). Net attributable profit surged to R3.3. . .  Full story
Revenue increased to R460.6 million (2010: R409.6 million). Earnings before interest, taxation and depreciation and amortisations (EBITDA) rose to R146.2 million. . .  Full story
Net insurance premium revenue rose by 6% to R7 billion (R6.6 billion) and net income was up by 7% R7.6 billion. . .  Full story
The company grew its revenue to R30.5 billion (R27.9 billion), but reported a loss before tax of R872 million (profit of. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0031088.1282.620.27%
JSE Top 4017:0027753.4271.140.26%
JSE Gold17:002664.14-16.76-0.63%
JSE Financial17:0021510.7474.500.35%
JSE Industrial17:0033076.41268.390.82%
JSE Indust 2517:0027895.32265.520.96%
JSE Resource17:0050373.86-204.24-0.40%
DJ Futures19:5011585.00-25.00-0.22%
DJ Ind19:4511536.49-77.04-0.66%
SP 50020:001208.98-9.91-0.81%
FTSE 10017:355418.6524.120.45%
All Ords08:374382.7012.800.29%
NZSE 5007:463332.2714.540.44%
NameTimeRPMove% Move
Gold/R kg20:0041137936240.89%
Brent Crude19:56115.11-.68-0.59%
Rand / Dollar19:586.99750.00960.14%
Rand / Pound19:5511.2834-0.0550-0.49%
Rand / Euro19:559.9892-0.0696-0.69%
Rand / NZD19:575.9551-0.0052-0.09%
Rand / AUD19:557.51230.03330.45%
Yen / Dollar19:5876.82000.13000.17%
Euro / Dollar19:550.70010.00490.70%
Dollar / Euro19:581.4275-0.0101-0.70%
Pound / Dollar19:550.61810.00320.52%

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The JSE Today
Trading Statistics

Major Moves Up
SharenameSaleMove% MoveVolume
1 PALLINGHT  3503310.41.%27800
2 WESIZWE  195147.73.%1246130
3 BEIGE-PR2  140107.69.%16281
4 CADIZ  290197.01.%68051
5 BAUBA  235156.82.%1000
6 VERIMARK  160106.67.%74400
7 CARGO  955495.41.%10450
8 INVICTA  45002255.26.%62526
9 VALUE  390195.12.%2510
10 COMAIR  231115.00.%3000
11 COAL  818384.87.%1052911
12 TFG  99164064.27.%1130681
13 DIGICOR  312124.00.%33793
14 BIDVEST  163016113.89.%1360225
15 SASFIN  34001253.82.%3150
16 STEFSTOCK  1125403.69.%580088
17 LITHA  26993.46.%201851
18 KUMBAIO  5000015513.20.%492604
19 JDGROUP  42051303.19.%429861
20 EOH  2340703.08.%211976

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Major Moves Down
SharenameSaleMove% MoveVolume
1 CALGRO  120-27-18.37.%13548
2 MAZOR  130-25-16.13.%100
3 COMPCLEAR  210-40-16.00.%11000
4 EQSTRA  669-43-6.04.%2548835
5 PHUMELELA  1055-64-5.72.%550
6 FAMBRANDS  4370-229-4.98.%46066
7 EASTPLATS  526-27-4.88.%65065
8 RAINBOW  1620-75-4.42.%1000
9 ALTRON-P  2423-106-4.19.%29498
10 MARSHALL  610-20-3.17.%2664
11 AQUARIUS  2791-84-2.92.%17540
12 LONMIN  14568-432-2.88.%255204
13 PALCAP  173-5-2.81.%947219
14 SANTAM  13200-365-2.69.%27461
15 ARM   18489-506-2.66.%915263
16 MRHLD  2712-69-2.48.%2209874
17 SPURCORP  1320-30-2.22.%26219
18 PARACON  182-4-2.15.%46000
19 WBHO  9980-208-2.04.%170675
20 GROUP-5  2600-53-2.00.%67823

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New Highs
SharenameSaleHighMove% MoveVolume
1 TFG  991699164064.27.%1130681
2 EOH  23402399703.08.%211976
3 MRPRICE  760076932253.05.%1384835
4 MUSTEK  525570152.94.%2150911
5 MASSMART  16300164494202.64.%918793
6 TRUWTHS  795680822012.59.%1112010
7 EXXARO  19300195704872.59.%1509042
8 WOOLIES  36753696300.82.%4884994
9 SHOPRIT  1108011194640.58.%2293114
10 REMGRO  1145111648600.53.%1115414

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New Lows
SharenameSaleLowMove% MoveVolume
1 COMPCLEAR  210210-40-16.00.%11000
2 PLATMIN  285285-5-1.72.%12500
3 VPIF  714700-1-0.14.%11000
4 DELTA  74070010.14.%7500

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Index Summary
Index NameRPMove% Move
Top 4027,753.4271.140.26%
Mid Cap42,083.54172.470.41%
Small Cap31,322.97-90.45-0.29%
Resource 2050,373.86-204.24-0.40%
Industrial 2527,895.32265.520.96%
Financial 158,057.4940.000.50%
Financial & Ind. 3030,852.42244.610.80%
All Share31,088.1282.620.27%
Oil & Gas 25,658.4331.700.12%
Mining 33,055.82-164.73-0.50%
Gold Mining2,664.14-16.76-0.63%
Platinum Mining67.05.170.25%
GENERAL MINING8,085.21-54.97-0.68%
Oil & Gas Producers 13,796.0717.050.12%
Basic Materials 28,019.44-108.10-0.38%
Chemicals 12,684.7022.000.17%
Forestry & Paper 12,682.56-154.96-1.21%
Industrial Metals 29,214.43628.192.20%
Industrials 27,520.61216.400.79%
General Industrials 77,468.901111.421.46%
Consumer Goods 27,281.66231.660.86%
Automobiles & Parts 3,657.10.000.00%
Household Goods147.1200.21%
Health Care 32,703.48-7.08-0.02%
Beverages 88.231.601.85%
Index NameRPMove% Move
Food Producers 49,040.07483.751.00%
Personal Goods 402.50-2.20-0.54%
Consumer Services 55,509.91770.461.41%
General Retailers 46,692.351145.752.52%
Travel & Leisure 3,662.154.540.12%
Media 81.66.931.15%
Support Services 2,286.8913.720.60%
Telecommunications 70,657.35207.950.30%
Financials 21,510.7474.500.35%
Banks 40,604.92250.260.62%
Non-life Insurance 32,008.80-885.09-2.69%
Life Insurance 15,532.0838.580.25%
General Financial 2,204.0810.940.50%
Technology 22,889.09-21.29-0.09%
SHARIAH TOP40 3,008.32-4-0.13%
FTSE/JSE SHARIAH ALL3,071.81-4-0.14%
COAL MINING25,895.936202.45%
FTSE JSE Fledgling 4,467.72340.77%
FTSE/JSE Alt X 1,095.00-23-2.07%
CAPPED PROPERTY 319.71-0.14%
RESOURCE 27,869.18-115-0.41%
DIVIDEND PLUS170.6221.08%
FTSE/JSE RAFI 406,456.25190.29%
Capped Top 4014,597.50510.35%
Capped All Share15,706.31480.30%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
02 Sep 2011CAPEVINJune 2011 (Final)
02 Sep 2011METOREXJune 2011 (Interim)
02 Sep 2011METOREXNPLJune 2011 (Interim)
05 Sep 20111TIMEJune 2011 (Interim)
05 Sep 2011A-V-IJune 2011 (Final)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
METROFILE11-08-3111-10-0711-10-17R 0.0250
SANTAM11-08-3111-09-1611-09-26R 2.0000
ARM11-08-3111-09-1611-09-26R 4.5000
CAPITEC-P11-08-3111-09-1611-09-26R 3.4027
ITLTILE11-08-3011-09-1611-09-26R 0.0600
Ex Div**
Share NameDec-DateLDTPay-DateAmount
PALAMIN11-08-0111-08-2611-09-05R 9.3100
STANBANK-P11-08-1111-08-2611-09-05R 3.1241
LIB-HOLD11-08-0411-08-2611-09-05R 1.8200
RESILIENT11-08-1011-08-2611-09-05R 1.0936
GFIELDS11-08-1111-08-2611-09-05R 1.0000

Upcoming AGMs**
CodeCompany NameDateStatus
BEGBeige Holdings Ltd02/09/2011Confirmed
MTXMetorex Ltd02/09/2011Confirmed
MTXNMetorex Ltd02/09/2011Confirmed
BEGP2Beige Holdings Ltd02/09/2011Confirmed
BEGPBeige Holdings Ltd02/09/2011Confirmed

Stock Exchange News Service
01/09/201117:31 Thabex - Condensed Interim Reviewed Group Results for the six months
01/09/201117:30MND/MNP - Mondi Limited/Mondi plc - Notification of Major Interests in
01/09/201117:26CFRNIC - Nedbank Limited - Dividend distribution announcement in relation to
01/09/201117:11IMPNIJ - Nedbank Capital - Dividend distribution announcement in relation
01/09/201117:10 Command Holdings Limited - Further update announcement
01/09/201117:10IMPNIK - Nedbank Limited - Dividend Distribution Announcement in relation to the
01/09/201117:09IMPNND - Nedbank Capital - Dividend distribution announcement in relation to
01/09/201117:06MTNNIH - Nedbank Capital - Dividend distribution announcement in relation to
01/09/201117:05MTNNNG - Nedbank Limited - Dividend Distribution Announcement in relation to the
01/09/201117:03WHLNIF - Nedbank limited - Dividend Distribution announcement in relation to the
01/09/201117:02MTNNNF - Nedbank Limited - Dividend distribution announcement in relation to the
01/09/201117:00SCIB: EXXSTE - The Standard Bank Of South Africa Limited - Dividend announcement
01/09/201117:00 Keaton Energy Holdings Limited - Award and acceptance of share
01/09/201116:59SCIB/NPNSTE - The Standard Bank of South Africa Limited - Dividend announcement
01/09/201116:57CLN000138 - The Standard Bank Of South Africa Limited - Interest Rate
01/09/201116:56CLN000116 - The Standard Bank Of South Africa Limited - Interest Rate
01/09/201116:55PGFP - PSG Financial Services Limited - Declaration of preference share
01/09/201116:53 Woolworths Holdings Limited - Dealing in securities by a director
01/09/201116:52 Woolworths Holdings Limited - Purchase of shares by the company in
01/09/201116:32OML - Old Mutual plc - Form 8.3
01/09/201116:30OML - Old Mutual plc- Form 8.3
01/09/201116:04 Rebosis Property Fund Limited - Rebosis presentation at JSE showcase
01/09/201115:32 Massmart Holdings Limited - Notice of General Meeting
01/09/201115:17DBNPNA - Deutsche Bank - Declared distribution announcement on Naspers STUB
01/09/201115:16DBNPN7 - Deutsche Bank - Declared distribution announcement on Naspers Stub
01/09/201115:07SHPIHD - Investec Warrants - Declared final dividend announcement on
01/09/201115:06MTNIDJ - Investec - Declared interim dividend announcement on MTN Group Limited
01/09/201115:05MTNIHH - Investec Warrants - Declared Interim Dividend Announcement on MTN Group
01/09/201115:01 Brikor Limited - Change to board of directors
01/09/201115:00 Brikor Limited - No change statement and notice of Annual General Meeting
01/09/201114:55 Eqstra Holdings Limited - Dealing in securities by directors and directors
01/09/201114:53 Redefine Properties Limited - Dealing in securities
01/09/201114:50 Exxaro Resources Limited - Trading of Exxaro ordinary shares on
01/09/201114:48ACL137 - Absa Bank Limited - New Financial Instrument Listing
01/09/201114:47ACL136 - Absa Bank Limited - New Financial Instrument Listing
01/09/201114:41 Iliad Africa Limited - Dealing by director of a major subsidiary and
01/09/201114:29 Beige Holdings Limited - Dealings in securities by directors
01/09/201114:19 Lonmin Plc - Total Voting Rights and Capital as at 31 August 2011
01/09/201114:18DBNPN8 - Deutsche Bank AG - Declared distribution announcement on Naspers
01/09/201114:15DBNPNB - Deutsche Bank AG - Declared distribution announcement on Naspers
01/09/201114:10 Huge Group Limited - No change statement and notice of Annual General
01/09/201114:10 Dialogue Group Holdings Limited - Capital distribution to shareholders
01/09/201113:50 Cadiz Holdings Limited - Related Party Transaction
01/09/201113:40 Gold Fields Limited - Dealing in securities by Director
01/09/201113:19 O-line Holdings Limited - Appointment of a non executive director
01/09/201113:12 Convergenet Holdings Limited - Director`s dealings in securities
01/09/201113:07INL/INP - Investec - Form 8 (DD)
01/09/201113:06INL/INP - Investec Limited/Investec plc - Form 8 (DD)
01/09/201112:30 British American Tobacco p.l.c. - Voting Rights and Capital
01/09/201112:00 Coal of Africa Limited - Memorandum of agreement signed between CoAL,
01/09/201111:52 Value Group Limited - No change statement and notice of annual general
01/09/201111:46ABAC07 - ABSA Bank Limited - Notice of expiry and maturity
01/09/201110:45 Optimum Coal Holdings Limited - Joint cautionary announcement of an
01/09/201110:15 Wilderness Holdings Limited - Results of the AGM and shareholder update
01/09/201110:01 Pretoria Portland Cement Company Limited - Results of Special General
01/09/201110:00 Discovery Holdings Limited - Audited results announcement and cash
01/09/201109:50INL/INP - Investec Limited - Investec plc - Disclosure in accordance with Rule
01/09/201109:47 Sea Kay Holdings Limited - Fulfilment of condition precedent and
01/09/201109:47 Erbacon Investment Holdings Limited - Results of the annual general
01/09/201109:44 Winhold Limited - Results of extraordinary general meeting
01/09/201109:40 Trematon Capital Investments Limited - Dealing in Securities by
01/09/201109:02 Redefine Properties International Limited - TR-1: Notification of major
01/09/201109:00 Insimbi Refractory and Alloy Supplies Limited - Change of designated
01/09/201108:52GEN - General - Late submission of Annual Financial Statements
01/09/201108:28 Super Group Limited - Dealing in securities by Super Group Share Incentive
01/09/201108:27 Erbacon Investment Holdings Limited - Appointment to the board of
01/09/201107:16 Thabex Limited - Trading statement
01/09/201107:10 British American Tobacco p.l.c.- Transaction in own shares
01/09/201107:05 Gold One International Limited - Change in Officeholders

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