Nedbank plans exit from Togo-based Ecobank, to focus on Southern and East Africa
Headline earnings rose 6% to R8.4 billion.
Diluted headline earnings per share increased 7% to 1 762 cents a share.
Revenue was up 4% to R36 406 million for the six months to end-June 2025.
The Group declared an Interim dividend of 1 028 cents per share, a 6% increase on the previous period.
Nedbank also announced that it plans to sell its 21.2% stake in Ecobank, based in Togo in West Africa, to focus more on Southern and East Africa.
This marks the end of a 17-year strategic alliance that enabled the Joburg-based lender to expand its footprint beyond southern Africa.
Stephen Grootes asks Nedbank Group CEO Jason Quinn about this strategic review of its continental assets.
What became clear to them is that having a minority stake in a bank created strategic issues in that they couldn't necessarily execute or drive the strategies they might have wanted to, Quinn says.
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Daily Maverick
8 hours ago
- Daily Maverick
The Finance Ghost: Shoprite still the checkout champion in retail wars
While there are opportunities to make money in the South African economy, you have to be pretty selective about where you look. It's not news to you that South Africa's economic growth has been less than inspiring, leading to South Africans becoming poorer by global standards. Nedbank's recent results are evidence of lacklustre economic activity, with the bank struggling to get enough loans out into the wild to offset the impact of a dip in interest rates. In the retail sector, The Foschini Group put forward some fascinating arguments at their Capital Markets Day about the shocking trend in the average South African's real income (ie adjusted for inflation) over the past decade and why this is forcing the group to see its value offerings as the best local growth engine. These corporate nuggets are a useful reminder that while there are definitely opportunities to make money in the South African economy, you have to be pretty selective about where you look. One of the most interesting ways to see this play out each year is in the retail sector, a competitive bloodbath of companies trying to compete for some of the most price-sensitive consumers in the world. There's no rising tide that lifts all boats here. Instead, there are boats that can get past the challenging waves and there are others that are getting smashed into the harbour. Last week in this column, I covered Boxer vs Woolworths Food as an excellent example of the power of having a focused model in a difficult economy. It's amazing how the clothing retail sector is filled with executives who find themselves drawn to offshore opportunities (traps?), with Woolworths continuing to suffer an Australian hangover. The Foschini Group is unfazed by this, with a clear message to the market that they will continue to pursue an international strategy despite reporting disappointing numbers in their UK and Australian businesses. The grocery sector has also seen some truly ugly offshore expansion stories. Spar is the standout example, with the group still reeling from its European exposure. Closer to home, even a grocery giant like Shoprite has learnt some hard lessons from trying to grow in Africa. For better or worse, the local market is where the best money is to be made by our retailers. This is where they understand their customers and can execute sensible strategies around store formats, supply chains and acquisitions (where those opportunities are still available in the market). The success that Shoprite has seen through focusing on South Africa rather than Africa is lovely to behold, while even Pick n Pay is starting to see the benefits of a turnaround strategy that has simplification at its core. This brings us to this week's corporate updates, with important financial news coming in from market leader Shoprite and laggard Pick n Pay. Before digging into these numbers, it's worth noting that the year-to-date performance is poor for both stocks, with Shoprite down nearly 10% and Pick n Pay down 15%. Before the latest results came out, Pick n Pay was actually 'ahead' this year, ie less negative than Shoprite. The share price performance can tell a different story from the underlying business performance because of the expectations baked into the share price. The market has incredibly high expectations for Shoprite, with Pick n Pay seen as a much more speculative play. We'll start with Pick n Pay, before ending off with Shoprite at the top of the food chain. Positive momentum at Pick n Pay – unless you're a franchisee There's an incredibly odd situation at Pick n Pay that goes against conventional wisdom. The corporate-owned stores are showing a faster turnaround than the franchise stores, despite the latter typically benefiting from being owner managed. Although this sounds great in theory, the problem is that Pick n Pay has a vast base of franchise stores. For the turnaround to be successful, they need both corporate-owned and franchise stores to pull their weight. In the past three reported periods (being the first and second halves of FY25, as well as the first 17 weeks of FY26), corporate-owned stores grew turnover by 3.1%, 3.6% and 4.0% respectively. In stark contrast, franchise supermarkets managed -1.4%, 1.1% and 0.2% respectively. It's not hard to spot the more consistent story with positive momentum. As encouraging as the corporate-owned story is, Pick n Pay's efforts to shrink into profitability have led to a situation where total sales growth is non-existent. Essentially, the store closures are offsetting the growth in other stores. While this is the right decision in terms of the turnaround, it doesn't exactly tell a story of growth. Pick n Pay Clothing remains the gem, with an astonishing 12.5% increase in like-for-like sales in the latest 17-week period. While the timing of winter has played a role here and this isn't indicative of sustainable growth, this store format's consistently strong performance shows that Pick n Pay can still win when they get the model right. Lots of wagging tails at Shoprite Shoprite's latest update covers the 52 weeks to 29 June 2025, so it's not directly comparable to Pick n Pay's release. Still, it tells an incredible story of a group that just doesn't stop winning, with HEPS from continuing operations expected to be 9.4% to 19.4% higher. This was driven by sales growth of 8.9%, with Supermarkets RSA leading the charge with growth of 9.5%. Digging deeper into Supermarkets RSA reveals that Checkers and Checkers Hyper delivered growth of 13.8%, while Shoprite and Usave were far more modest at 5.2%. Boxer is giving Shoprite a proper go when it comes to lower-income shoppers, whereas higher-income shoppers have flocked to Checkers at a time when Pick n Pay has been shedding customers. It's not all good news, though. There's a concerning trend in sales momentum from the first half to the second half of the year, with Supermarkets RSA growing 10.4% in the first half and 8.5% in the second half. There's certainly nothing wrong with 8.5% growth, but Shoprite is trading on a demanding earnings multiple and any slowdown in growth will be a concern for the market. Unlike Pick n Pay, which must shrink into profitability, Shoprite is expanding in key verticals. They love the pet opportunity for example, with Petshop Science opening 60 new stores to take the total footprint to 144 stores. Interestingly, the worrying trend in the birth rate is on full display at Shoprite, with just one new Little Me store opened in this period, taking the total to 11 stores. With the furniture business being sold to Pepkor and with a decision to further reduce the exposure to certain countries in Africa, Shoprite's focused grocery strategy is working beautifully. They are experimenting in other categories, but they understand what the core of the business must be in order to continue being successful. The risk, as always, lies in overpaying for the shares. Based on the guided range for HEPS with a midpoint of R13.57, the price/earnings (P/E) multiple is just below 20x. My observation of retail stocks on the JSE is that they start to run out of puff at a P/E above 20x, so there's not much room for multiple expansion here. If Shoprite can maintain this kind of growth in HEPS though, investors won't need multiple expansion to be rewarded. DM
The Star
9 hours ago
- The Star
Gauteng department faces scrutiny over R8. 4 million contracts to questionable 'military veterans'
The Gauteng Department of Sports, Arts, Culture, and Recreation (SACR) is slated after awarding over R8.4 million to companies claiming to be owned by 'military veterans,' despite records showing some directors were born in the 1990s. The Military Veterans Act of 2011 defines a military veteran as any South African citizen who falls into one of the following categories: Those who rendered military service to any of the military organisations involved on all sides of South Africa's liberation war from 1960 to 1994; Those who served in the Union Defence Force before 1961; and Those who became members of the South African National Defence Force (SANDF) after 1994 have completed their military training, no longer perform military duties, and have not been dishonourably discharged from the military. Following questions raised by the Democratic Alliance (DA) in the Gauteng Provincial Legislature (GPL), the party stated that Gauteng MEC for Sports, Arts, Culture, and Recreation, Matome Chiloane, confirmed that the department awarded contracts to 24 companies owned by military veterans over the past three financial years. Kingsol Chabalala, DA Gauteng Shadow MEC for Sports, Arts, Culture and Recreation, stated that the awarded companies have provided a range of services, including security at libraries such as Driezik and Kagiso, as well as managing events for wreath-laying ceremonies and celebrations for Human Rights and Heritage Day. He highlighted that the documents, in possession of The Star , exposed a troubling trend of false claims, pointing out that many companies on the list are directed by individuals born in the 1990s, which disqualifies them from being considered genuine military veterans. 'A closer inspection of the entities reveals a disturbing pattern of misrepresentation. Notably, several listed companies have directors who were born in the 1990s, making them far too young to be categorised as military veterans. For instance, the director of RE DLALA GAME TRADING, which received R459 156.46, was born in 1990; the director of Intellectditcom, backed with R147 700, was born in 1995; and the director of MATHABATSEME ENTERPRISE, which received R486 349.50, was born in 1996.' Chabalala further asserted that this represents a clear abuse of procurement processes to secure profitable contracts, exposing how certain individuals within the department are prepared to exploit veterans' legacy and public resources for personal benefit. He further stated that the DA will contact Chiloane to seek clarification on how this clear inconsistency was ignored or tolerated. 'The DA will write to MEC Chiloane, urging him to clarify how such a blatant discrepancy went unnoticed or permitted to persist under his watch. We will also demand that he conduct an urgent investigation into those responsible for awarding these contracts and ensure that they face appropriate consequences. This process must be carried out transparently and without bias,' Chabalala added. Responding to the concerns, Mxolisi Mkhonza, spokesperson for the Department of Military Veterans, explained that serving members of the SANDF qualify as military veterans once they leave the armed forces and are registered on the South African National Military Veterans Database. This includes individuals who have completed the Military Skills Development System (MSDS), which annually recruits citizens into the SANDF. Mkhonza also noted that the department is considering amending the registration process. 'Therefore, there will be no need for an investigation as these are legitimate military veterans according to the Act in its current state. The DMV is, however, looking to begin the process of amending the Military Veterans Act in order to circumvent such gaps, which are being exploited by certain individuals.' He added that the application and verification process for recognition as a military veteran involves several requirements, beginning with proof of having served or trained as a soldier, details of which are available on the DMV website. Once approved, individuals are listed on the South African National Military Veterans Database and issued a confirmation letter. This letter enables them to apply for various benefits outlined in Section 5 of the Act, provided they meet the qualifying criteria. Mkhonza explained that the DMV can not comment on other departments' procedures but works with them across government to deliver benefits. 'As a coordinating department, we work with various other government departments at all spheres of government in rolling out benefits. Each department may then have its criteria on how to go about issuing benefits to individuals specifically earmarked as military veterans. The DMV cannot speak on processes followed by other departments, such as the SACR.' The Star's attempts to get a comment from SACR were unsuccessful. We had not received a response by publication time. The Star [email protected]
The South African
11 hours ago
- The South African
Here's why South Africa's richest woman may return home
South African billionaire and Sygnia CEO Magda Wierzycka has revealed she may return to Mzansi, citing controversial tax changes proposed by the United Kingdom government that threaten the financial security of high-net-worth individuals. Wierzycka, 56, one of South Africa's wealthiest women with an estimated net worth of $250 million (R4.5 billion), has warned that new UK tax policies targeting non-domiciled residents could impact her estate planning and investment strategies – possibly prompting her relocation back to her home country. 'In my situation, let's assume I die right now, my estate and the assets that I have in my trust would be subject to inheritance tax here immediately,' Wierzycka said in an interview with Sky News . The UK government's proposed reforms include subjecting foreign-owned assets to inheritance tax, even when held in trusts or offshore structures. These measures are part of a broader strategy to end favourable tax treatment for wealthy individuals who do not formally claim permanent residency in the UK – known as 'non-doms.' Wierzycka, who relocated to London several years ago amid rising safety concerns and her public anti-corruption stance in South Africa, said the changes drastically affect how she manages her global wealth. The tax implications, she says, are severe enough to make continued residence in the UK 'unviable', especially with South Africa's foreign exchange controls adding a layer of complexity. 'South Africa has restrictions on the free movement of cash out of the country,' she explained. 'So it's a situation where my children might not be able to settle the [UK inheritance tax] bill.' Wierzycka, also known for her vocal criticism of state capture during the Zuma years, hinted that the tax policy shift would also redirect investment strategies for her firm, Sygnia Asset Management. 'I was in the midst of raising a fourth fund to invest solely into the UK,' she told Sky News. 'The message to my investors is: we'll be deploying the capital around the world. We are not coming to the UK.' The remarks mark a significant policy shift for Sygnia, which had previously prioritised UK-based investment opportunities. Although Wierzycka had previously vowed never to return to South Africa due to security risks and political instability, she now acknowledges that the evolving UK tax landscape may leave her with few alternatives. A potential return would likely reignite debates about South Africa's tax system, capital controls, and security climate, as the country continues to navigate its own economic and political transition following a coalition government formed after the ANC lost its majority in 2024. No formal timeline has been announced for Wierzycka's potential move, but the situation underscores growing concerns among global investors over rising tax nationalism in the UK and beyond. Wierzycka, who was born in Poland, emigrated to South Africa when she was 13. She attended Pretoria High School for Girls. She then attended the University of Cape Town where she graduated with a Bachelor of Business Science and a Postgraduate diploma in actuarial science in 1993. She has two sons with husband Simon Peile. Let us know by leaving a comment below, or send a WhatsApp to 060 011 021 1 Subscribe to The South African website's newsletters and follow us on WhatsApp, Facebook, X and Bluesky for the latest news.
