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 The Sharenet Daily 
Tuesday, 28 July 2015 - 20:00
 
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World Markets (Spot Prices)
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Major Moves
Index Summary
Latest Consensus Changes / Results Expected
Recent Dividends / Ex Div
Upcoming AGMs
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Seed Weekly - Kumba - Nerves of Steel Required

Kumba Iron Ore Ltd is the only pure play iron ore company listed on the JSE, and it operates across the entire value chain including exploration, extraction, beneficiation, marketing, sales and shipping of iron ore.

History

Kumba can trace its roots back to the parastatal steel company Iscor, which established the Thabazimbi mine in 1932 and the Sishen mine in 1954. The Sishen-Saldanha rail link, developed by government in 1976, enabled the easy transportation of iron ore to the Saldanha port for export.

Following Iscor’s privatisation in 1989, it was unbundled into Iscor and Kumba Resources. Kumba was listed on the JSE in November 2006 as the result of the further unbundling of Kumba Resources’ iron ore assets.

Operations

The Company operates three mines – Sishen and Kolomela in the Northern Cape, and Thabazimbi mine in the Limpopo Province.
Sishen is the flagship operation, has a 19-year life of mine and at 14km long is one of the largest open pit mines in the world. Kolomela mine, although the newest mine, is going from strength to strength in terms of production and has a 25-year life of mine.

Thabazimbi, in operation since 1932, is no longer cost-efficient, with difficult mining conditions increasing safety risks. As a result, Kumba has initiated the process of closing the mine down completely.

Latest Financial Results

Kumba recently released its results for the six months ended 30 June 2015, and it is clear that the company is under a lot of pressure due to the falling iron ore price.

Revenue fell by 23% to R 20.5bn, resulting in a drop of 53% in operating profit and a substantial 61% decrease in Headline Earnings Per Share. Volatile trading conditions and the need to maintain some financial flexibility resulted in the board not declaring an interim dividend.

On the positive side, production decreased by only 1% to 22.6Mt, export sales were up 18% to record levels, and controllable costs were brought down by 16%.

The graph below illustrates the drivers behind Kumba’s change in revenue over the reporting period:

The iron ore export price dropped dramatically, down 41% from $104/t in 1H14 to $61/t in 1H15, resulting in an R11bn decrease in revenue. Shipping revenue reduced by around R 500m to R 1.6bn.

Offsetting these negative effects were higher sales volumes, resulting in a net increase of R3.9bn, and a weaker ZAR/USD exchange rate.

Outlook and Fundamentals

The company is in the process of reconfiguring its operations in light of the very challenging market environment. It will attempt to bring down its cash breakeven price from $63/tonne to $45/tonne by reducing overhead costs, reinforcing capital discipline and maintaining its focus on product quality.

The difficult mining conditions at Thabazimbi was worsened by a recent slope failure, and as a result the mine has reached the end of its economic life and will now be closed down.

With demand from China ever slowing and competitors in Australia and Brazil increasing supply, the iron ore price is expected to remain under pressure in the foreseeable future. This leaves only one, very challenging, option – increase production while reducing marginal costs and waste volumes.

The share has collapsed from over R600 to just over R100. This has meant that despite the collapse in earnings the historical PE has declined to just over 5 times, which appears very cheap compared to the JSE’s 17.9. The dividend yield, which has peaked at over 20% early in July, has dropped to 7.4% with no interim dividend declared.

Kumba is currently held in the Seed Equity Fund, with the high Dividend Yield, Earnings Yield and Cashflow/Price ratio earning it a place in the Value portfolio.

Kind regards,

Cor van Deventer

Tel 0219144966
Fax 0219144912
Email info@seedinvestments.co.za

Seed is hiring: Click through to our LinkedIn profiles to see vacancies at Seed Investment Consultants and Seed Analytics

www.seedinvestments.co.za

Tue, 28 Jul 2015
Top News
[IMAGE]
Local markets  Full story

[IMAGE]
South Africa kept its 2015 maize output unchanged at 9.755 tonnes on Tuesday, the government's Crop Estimates Committee (CEC) said. South Africa is still expected to reap its lowest staple crop harvest since 2007, which is forecast to be a third less compared with the 2014 crop due  Full story
NATO gave Turkey its full political support in fighting militants in Syria and Iraq at an emergency meeting on Tuesday but several nations urged Ankara not to undermine the Kurdish peace process by using excessive military force.  Full story
A Libyan court on Tuesday sentenced Muammar Gaddafi's most prominent son, Saif al-Islam, and eight others to death over war crimes including killings of protesters during the 2011 revolution that ended his father's rule.  Full story
Malaysian Prime Minister Najib Razak sacked his deputy and four other ministers in a cabinet reshuffle on Tuesday, and replaced the attorney general, in a bid to stifle questions over a graft scandal at debt-laden state investment fund 1MDB.  Full story
 
Markets
U.S. and European stocks rose on Tuesday, and were on track to snap five-day losing streaks as investors focused on earnings and mergers. . .  Full story
Gold firmed on Tuesday but remained near 5-1/2-year lows as markets braced for this week's Federal Reserve meeting, at which policymakers are expected. . .  Full story
European stocks snapped a five-day losing streak on Tuesday, with merger activity and earnings news lifting major markets by more than 1 percent,. . .  Full story
Hong Kong blue chip stocks rose on Tuesday, bucking falls for mainland shares, on hopes for a stabilising China market as Beijing hinted. . .  Full story

China stocks ended lower in a volatile session on Tuesday, even as Beijing pledged to lend further support after stocks sank 8 percent. . .  Full story
Australian shares closed marginally lower on Tuesday as strength in the energy and healthcare sectors largely offset worries about China's economy.. . .  Full story
Japan's Nikkei share average edged down on Tuesday in volatile trade after crawling back from a more than two-week low hit earlier in. . .  Full story
The biggest rout in Chinese shares in eight years stoked concerns over slowing growth in the world's No. 2 economy on Monday, knocking. . .  Full story
SA Business
South African power utility Eskom is open to importing coal for plants it still plans to commission, a coal conference heard. . .  Full story
Diageo and Heineken have agreed to dissolve their joint ventures in South Africa and Namibia, so the British spirits maker and. . .  Full story
Shares in South Africa's MTN fell 5 percent as the company said it expects a drop in first-half earnings, blaming a. . .  Full story
South Africa's South Africa's National Union of Mineworkers (NUM) said on Monday it had signed a two-year wage agreement with junior. . .  Full story

South Africa's largest private education company Curro Holdings said a 6 billion rand ($478 million) offer for smaller rival Advtech is. . .  Full story
South African private education firm Advtech is talking to other potential investors and has not referred a takeover bid by larger. . .  Full story
Emerging stocks languished near a two-year low on Tuesday after Chinese shares took another beating while currencies, mired around multi-year lows, were pulled in. . .  Full story
France's largest telecom operator Orange inched closer in the second quarter to a long-awaited recovery as customers shifted to premium high-speed mobile and broadband. . .  Full story

South Africa's rand recovered slightly early on Tuesday after touching a fresh 14-year in the previous session as emerging markets wobble on concerns over China's economy.. . .  Full story
Company News
ADvTECH shareholders are advised that at the annual general meeting (AGM) of shareholders held on Tuesday, 28 July 2015, all the. . .  Full story
In terms of the Listings Requirements of the JSE Ltd., a listed company is required to publish a trading statement as. . .  Full story
Shareholders are advised that the notice of annual general meeting (˘notice÷) of the company has been distributed to shareholders today. As. . .  Full story
Shareholders are advised that the salient dates for the twenty-first dividend declaration on the variable rate non-cumulative, non- redeemable B preference. . .  Full story

Production Results to 30 June 2015 Highlights *Attributable production from operating mines up 5% quarter-on-quarter, up 6% compared to previous corresponding period, quarter ended June 2014 (pcp) *Both Kroondal and Mimosa production at fourth quarter record levels *Average USD PGM basket price decreased 4% for the quarter ű down 16% compared to pcp *Kroondal PGM basket price decreased 3% on average to R12 120 per PGM ounce quarter-on-quarter - down 5% compared to the pcp *Mimosa. . .  Full story
Company Results
Revenue decreased to R3.9 billion (R4.1 billion). Gross profit fell to R288.2 million (R453.1 million). Operating profit came in at R138.5. . .  Full story
Revenue was up 8% to R8.6 billion (R7.99 billion). Profit from operations rose by 22% to R991 million (R814 million). Net. . .  Full story
The financial year ending 31 March 2015 reflected the third full year of operation of Sacoven, which was incorporated on 16. . .  Full story
Revenue for the interim period increased to R93.8 million (R89.5 million). Operating profit before interest decreased to R19.7 million (R20.9 million).. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0050758.42-543.13-1.06%
JSE Top 4017:0045290.17-478.77-1.05%
JSE Gold17:00809.07-55.71-6.44%
JSE Financial17:0044631.04-328.24-0.73%
JSE Industrial17:0073555.96-1009.86-1.35%
JSE Indust 2517:0065597.66-903.69-1.36%
JSE Resource17:0035168.39-70.94-0.20%
DJ Futures06:0417438.0042.000.24%
DJ Ind20:0017616.30175.711.01%
SP 50020:002091.3923.751.15%
Nasdaq20:005086.5946.810.93%
FTSE 10017:356555.2850.150.77%
DAX18:0811173.91117.511.06%
CAC4018:084977.3249.721.01%
Nikkei08:2820328.89-21.21-0.10%
Shanghai09:283663.00-62.56-1.68%
Hang-Seng10:2824503.94151.980.62%
All Ords08:395571.00-8.20-0.15%
NZSE 5008:085848.39-23.67-0.40%
NameTimeRPMove% Move
Gold $19:591096.141.920.18%
Gold R19:5913766.2813766.280.00%
Gold R/kg20:00442700-3614-0.81%
Silver $19:5914.6690.11700.80%
Platinum $19:59984.282.880.29%
Palladium $19:59619.867.761.27%
R18617:338.18-.02-0.24%
R20417:147.50.000.00%
R20717:137.71-.01-0.13%
Brent Crude19:3253.61-1.01-1.85%
USD / ZAR19:5912.5621-0.0609-0.48%
GBP / ZAR19:5519.5704-0.0629-0.32%
EUR/ ZAR19:5513.8860-0.1277-0.91%
NZD/ ZAR19:598.41028.41020.00%
AUD / ZAR19:559.21260.03210.35%
USD / JPY19:59123.56300.32900.27%
EUR / USD19:591.1055-0.0035-0.32%
GBP / USD19:591.56050.00490.32%

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The JSE Today

Trading Statistics
DateAdv.Decl.Unch.ActivesVolumeValueTradesOrders
28/07/201510425461419259,853,947R20,193,963,0772637841661765
27/07/201516318669418228,325,190R15,884,623,4202069631612906
24/07/201511027244426228,166,238R16,225,557,5202198831328451
23/07/201519713369399241,237,120R17,830,572,3942411941711820
22/07/20159826151410282,766,520R20,656,919,3292358121354280
* Includes all listed instruments on the JSE
Major Moves Up
SharenameSaleMove% MoveVolume
1 RANGOLD  2352813.53.%1000
2 STEFSTOCK  579499.25.%117528
3 ADRENNA  140107.69.%53095
4 Cognition  200147.53.%5000
5 PETMIN  13896.98.%19500
6 RBPLAT  36372256.59.%146479
7 CROOKES  67903805.93.%285
8 AME  101005505.76.%470
9 ARCMITTAL  1392755.69.%331865
10 PINNACLE  1235655.56.%333927
11 LONMIN  1136565.19.%1799426
12 AQUARIUS  12565.04.%3120361
13 TEX  1088434.11.%70557
14 WESCOAL  15763.97.%12000
15 KUMBAIO  109004093.90.%981367
16 HOSP-B  22083.77.%231095
17 ARB  580203.57.%742730
18 ONELOGIX  485153.19.%47636
19 STELLAR  26883.08.%702150
20 CHOPPIES  639193.06.%250341

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Major Moves Down
SharenameSaleMove% MoveVolume
1 EASTPLATS  1257-227-15.30.%2010
2 ZCI  398-57-12.53.%7000
3 GFIELDS  3427-295-7.93.%1748504
4 AECI  10500-869-7.64.%119465
5 CONDUIT  245-20-7.55.%18220
6 CSG  152-12-7.32.%6563
7 SIBANYE  1633-107-6.15.%2014636
8 MTN  20030-1274-5.98.%12805515
9 MARSHALL  1600-99-5.83.%15000
10 ANGGOLD  7915-485-5.77.%2066709
11 BOWCALF  850-49-5.45.%2249
12 HARMONY  1234-66-5.08.%1809818
13 GLOBAL  190-10-5.00.%19330
14 LEWIS  6516-334-4.88.%686872
15 TRNSHEX  300-15-4.76.%69871
16 TRUSTCO  395-19-4.59.%476381
17 CML  7633-347-4.35.%1212769
18 INFRASORS  130-5-3.70.%4000
19 MPACT  4467-168-3.62.%116353
20 HUDACO  12305-456-3.57.%182596

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New Highs
SharenameSaleHighMove% MoveVolume
1 MONDIPLCP  29681298244571.56.%530075
2 MONDILTDP  29701298664161.42.%500108
3 TRANSCAP  10501075100.96.%138787

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New Lows
SharenameSaleLowMove% MoveVolume
1 SIBANYE  16331585-107-6.15.%2014636
2 CML  76337400-347-4.35.%1212769
3 ILLOVO  12751271-38-2.89.%413628
4 HOWDEN  28402700-65-2.24.%112240
5 INVICTA  61506001-88-1.41.%90170
6 TONGAAT  1185111685-149-1.24.%98501
7 WBHO  95009482-100-1.04.%44936
8 DELTAINT  16401640-10-0.61.%825
9 LONMIN  11361060565.19.%1799426
10 RBPLAT  363734002256.59.%146479
11 STEFSTOCK  579402499.25.%117528

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Index Summary
Index NameRPMove% Move
Top 4045,290.17-478.77-1.05%
Industrial73,555.96-1009.86-1.35%
Mid Cap66,795.00-786.67-1.16%
Small Cap58,725.37-568.10-0.96%
Resource 2035,168.39-70.94-0.20%
Industrial 2565,597.66-903.69-1.36%
Financial 1516,818.71-145.93-0.86%
Financial & Ind. 3070,806.39-911.62-1.27%
All Share50,758.42-543.13-1.06%
Oil & Gas 10,666.55-338.62-3.08%
Mining 21,005.00-36.60-0.17%
Gold Mining809.07-55.71-6.44%
Platinum Mining21.73.190.88%
GENERAL MINING6,425.1929.890.47%
Oil & Gas Producers 57,352.05-1820.70-3.08%
Basic Materials 20,809.60-82.36-0.39%
Chemicals 21,064.94-506.41-2.35%
Forestry & Paper 47,579.80617.171.31%
Industrial Metals 6,759.10226.253.46%
Industrials 43,318.23-763.89-1.73%
General Industrials 154.66-3.01-1.91%
Consumer Goods 66,885.311.930.00%
Automobiles & Parts 8,321.89-22.64-0.27%
Household Goods523.97-4-0.84%
Health Care 9,850.82-189.27-1.89%
Beverages 223.17-.43-0.19%
Index NameRPMove% Move
Food Producers 8,454.65-75.48-0.88%
Personal Goods 1,047.906.190.59%
Consumer Services 15,888.72-311.82-1.92%
General Retailers 82,264.61-419.59-0.51%
Travel & Leisure 6,102.30-71.33-1.16%
Media 379.62-9.84-2.53%
Support Services 3,325.127.330.22%
Telecommunications 9,894.14-540.34-5.18%
Financials 44,631.04-328.24-0.73%
Banks 77,067.67-443.60-0.57%
Non-life Insurance 55,000.36-765.66-1.37%
Life Insurance 41,227.39-518.82-1.24%
General Financial 4,712.50-39.89-0.84%
Technology 64,182.9666.310.10%
SHARIAH TOP40 3,352.17-47-1.39%
FTSE/JSE SHARIAH ALL3,552.44-51-1.42%
COAL MINING9,098.27971.08%
FTSE JSE Fledgling 6,691.21460.69%
FTSE/JSE Alt X 1,349.8720.14%
SA LISTED PROPERTY 647.01-0.17%
CAPPED PROPERTY 567.65-0.18%
RESOURCE 19,077.40-34-0.18%
DIVIDEND PLUS209.41-2-1.14%
FTSE/JSE RAFI 409,183.29-110-1.18%
Capped Top 4024,174.19-251-1.03%
Capped All Share25,745.59-275-1.06%
JSE TABACO 8,890.72370.41%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
SBKSTANDARD BANK GROUP LIMIT...BUY27/07/2015
RESRESILIENT PROPERTY INCOME...SELL24/07/2015
EMIEMIRA PROPERTY FUNDBUY24/07/2015
SACSA CORPORATE REAL ESTATE ...HOLD24/07/2015
CPFCAPITAL PROPERTY FUND LIM...SELL24/07/2015
Results Expected**
ExpectedCompany NameFin. Date
29/07/2015B-AFRICAJune 2015 (Interim)
29/07/2015BATSJune 2015 (Interim)
29/07/2015CAPCOJune 2015 (Interim)
29/07/2015CAPPROPJune 2015 (Interim)
30/07/2015ABSABANK-PJune 2015 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
HULAMIN27/07/1514/08/1524/08/15ZAR 0.0800
CULINAN5.524/07/1514/08/1524/08/15ZAR 0.0550
ANGLO24/07/1531/07/1517/09/15USD 0.3200
ECSP A22/07/1506/08/1517/08/15ZAR 0.6849
ECSP C222/07/1506/08/1517/08/15ZAR 0.9075
Ex Div**
Share NameDec-DateLDTPay-DateAmount
INVLTD21/05/1524/07/1514/08/15GBP 0.1150
INVPLC21/05/1524/07/1514/08/15GBP 0.1150
TRUSTCO29/06/1524/07/1521/08/15NAD 0.0400

Upcoming AGMs**
CodeCompany NameDateStatus
ADHADvTECH Ltd.28/07/2015Confirmed
SNVSantova Ltd.28/07/2015Confirmed
TONTongaat Hulett Ltd.29/07/2015Confirmed
CGRCalgro M3 Holdings Ltd.29/07/2015Confirmed
IPFInvestec Property Fund Ltd.29/07/2015Confirmed

Stock Exchange News Service
DateTimeHeadline
28/07/201517:39VUKILE PROPERTY FUND LIMITED - New financial instrument listing - VKC10
28/07/201517:38ELLIES HOLDINGS LIMITED - Dealing in securities by a director
28/07/201517:30GLOBAL ASSET MANAGEMENT LTD - Unaudited interim results for the six months ended...
28/07/201517:08BSI STEEL LIMITED - Dealing in securities
28/07/201517:05ACCELERATE PROPERTY FUND LTD - Results Of Annual General Meeting
28/07/201516:48ADVTECH LIMITED - Results of AGM, Chairmans Statement and Changes to the Board
28/07/201516:45BNP PARIBAS ARBITRAGE ISSUANCE B.V. - Redemption Of Certificates Relating To The...
28/07/201516:44BNP PARIBAS ARBITRAGE ISSUANCE B.V. - Redemption of certificates relating to the...
28/07/201516:40GLOBAL ASSET MANAGEMENT LTD - Further Trading Statement
28/07/201516:30SABMILLER PLC - Block listing application
28/07/201516:30GROWTHPOINT PROPERTIES LIMITED - Dealings in securities by a director's associat...
28/07/201516:10NIVEUS INVESTMENTS LTD - Update relating to the Specific Issue of Shares
28/07/201515:49INVICTA HOLDINGS LIMITED - Directors dealing in securities
28/07/201515:08ALEXANDER FORBES GROUP HOLDINGS LIMITED - Notice of withdrawal of special resolu...
28/07/201515:00CORONATION FUND MANAGERS LIMITED - Dealings in securities by CFM Bonus Pool Trus...
28/07/201514:05OLD MUTUAL PLC - Form 8.3 - Public Opening Position Disclosure
28/07/201513:50OLD MUTUAL PLC - Form 8.3 - Public Opening Position Disclosure
28/07/201513:24HUDACO INDUSTRIES LIMITED - Dealing in securities by a director
28/07/201513:04BUILDMAX LIMITED - Notification in terms of section 122(3) of the Companies Act ...
28/07/201513:01PLATFIELDS LIMITED - Resignation of Transfer Secretary
28/07/201513:00HOWDEN AFRICA HOLDINGS LIMITED - Trading Statement for the interim period ended ...
28/07/201512:45OLD MUTUAL PLC - Form 8.3 - Public Opening Position Disclosure
28/07/201512:19TEXTON PROPERTY FUND LIMITED - Posting of the Circular and Notice of General Mee...
28/07/201512:00A E C I LIMITED - Announcement: results presentation
28/07/201511:04OMNIA HOLDINGS LIMITED - No Change Statement and Notice of Annual General Meetin...
28/07/201510:48NEDBANK LIMITED - Dividend Announcement - AGLNNI
28/07/201510:44NEDBANK LIMITED - Dividend Announcement - AGLNIK
28/07/201510:05THE SPAR GROUP LIMITED - Dealing in securities by The SPAR Group Limited Employe...
28/07/201509:56INVESTEC PROPERTY FUND LIMITED - New Financial Instrument Listing - IPFC07
28/07/201509:05NEW GOLD ISSUER LIMITED - NGPLT-Additional Listing of NewGold Platinum Debenture...
28/07/201509:00NEW GOLD ISSUER LIMITED - NGPLT-Additional Listing of NewGold Platinum Debenture...
28/07/201509:00ABSA BANK LIMITED - ASN077-New Listing
28/07/201508:53CSG HOLDINGS LIMITED - Dealing in securities
28/07/201508:33MTN GROUP LIMITED - Trading Statement for the six-month period ended 30 June 201...
28/07/201508:30STANDARD BANK GROUP LIMITED - Trading statement in respect of the six months end...
28/07/201508:18FIRSTRAND LIMITED - Dividend declaration of 363.93010 cents per variable rate no...
28/07/201508:00AQUARIUS PLATINUM LIMITED - Production results to 30 June 2015
28/07/201508:00MONDI LIMITED - Mondi Group: Trading Statement
28/07/201508:00SACOVEN PLC - Annual report and audited financial statements
28/07/201507:05A E C I LIMITED - Condensed consolidated unaudited interim financial results and...

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