Latest news with #AH-Vest
IOL News
2 days ago
- Business
- IOL News
AH-Vest offers minority shareholders 55 cents per share to delist from JSE
AH-Vest plans to delist from the JSE as it says the cost of listing is prohibitive considering how erratic the share price had been and the low level of liquidity of shares on the market. Image: Supplied AH-Vest minority shareholders are being offered 55 cents a share in cash as part of plans to delist the company, a price that represents a whopping 1833% premium over the 3 cents market price when the company first cautioned about a possible transaction. The shares traditionally trade very rarely, and on Tuesday, they were still untraded at 3 cents a share, despite the announcement of the plans to delist via a scheme of arrangement. AH-Vest is a South African food manufacturing company best known for its range of sauces and condiments, including its All Joy brand. The plan to delist from the JSE's AltX board comes at a time when the JSE has undertaken several initiatives to make it easier and less costly for small and medium-sized businesses to list. These initiatives include establishing the AltX board to support high-growth entrepreneurial businesses that may not yet meet the stringent JSE Main Board requirements, lowering entry requirements, and introducing designated advisors for SMEs. The company's board said on Tuesday that they had received a firm offer from the parent company, Eastern Trading, to acquire 100% of the shares via a scheme of arrangement, as it already controls 95.7% of the shares. An independent board has been appointed by AH-Vest's board to oversee the process. Explaining their reasons to delist, AH-Vest's board mentioned that recent changes in Section 10 of the JSE listings requirements regarding ordinary course of business, along with the erratic share price and poor liquidity, have effectively removed the justification for maintaining a listing on the JSE. Recent changes to Section 10 of the JSE listing requirements primarily address related party transaction considerations. 'The resultant cost of compliance due to the low market capitalisation is prohibitive,' AH-Vest's board stated. They noted that Eastern Trading had not traded in AH-Vest's shares in the six-month period prior to the delivery of the offer to minority shareholders. 'In this circumstance, the proposed transaction is, in the view of the board, worthy of consideration by AH-Vest shareholders as envisaged in terms of the scheme,' the board said. In the six months to December 31, 2024, AH-Vest reported that its revenue had declined to R100.63 million from R114.45m at the end of the same period the previous year, while headline earnings per share fell to R0.17 compared to R2.60 a year before. An online search revealed that there were about 14 company delistings from the JSE in 2024, continuing a multi-year trend of a contraction in the number of listed companies. Visit:
Yahoo
28-03-2025
- Business
- Yahoo
AH-Vest Limited's (JSE:AHL) Financials Are Too Obscure To Link With Current Share Price Momentum: What's In Store For the Stock?
Most readers would already be aware that AH-Vest's (JSE:AHL) stock increased significantly by 1,423% over the past three months. But the company's key financial indicators appear to be differing across the board and that makes us question whether or not the company's current share price momentum can be maintained. Specifically, we decided to study AH-Vest's ROE in this article. ROE or return on equity is a useful tool to assess how effectively a company can generate returns on the investment it received from its shareholders. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company's shareholders. The formula for ROE is: Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity So, based on the above formula, the ROE for AH-Vest is: 7.9% = R4.0m ÷ R51m (Based on the trailing twelve months to June 2024). The 'return' refers to a company's earnings over the last year. That means that for every ZAR1 worth of shareholders' equity, the company generated ZAR0.08 in profit. View our latest analysis for AH-Vest We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Assuming all else is equal, companies that have both a higher return on equity and higher profit retention are usually the ones that have a higher growth rate when compared to companies that don't have the same features. It is hard to argue that AH-Vest's ROE is much good in and of itself. Even when compared to the industry average of 14%, the ROE figure is pretty disappointing. Given the circumstances, the significant decline in net income by 28% seen by AH-Vest over the last five years is not surprising. However, there could also be other factors causing the earnings to decline. Such as - low earnings retention or poor allocation of capital. As a next step, we compared AH-Vest's performance with the industry and found thatAH-Vest's performance is depressing even when compared with the industry, which has shrunk its earnings at a rate of 1.9% in the same period, which is a slower than the company. Earnings growth is an important metric to consider when valuing a stock. The investor should try to establish if the expected growth or decline in earnings, whichever the case may be, is priced in. Doing so will help them establish if the stock's future looks promising or ominous. One good indicator of expected earnings growth is the P/E ratio which determines the price the market is willing to pay for a stock based on its earnings prospects. So, you may want to check if AH-Vest is trading on a high P/E or a low P/E, relative to its industry. While the company did payout a portion of its dividend in the past, it currently doesn't pay a regular dividend. This implies that potentially all of its profits are being reinvested in the business. Overall, we have mixed feelings about AH-Vest. While the company does have a high rate of reinvestment, the low ROE means that all that reinvestment is not reaping any benefit to its investors, and moreover, its having a negative impact on the earnings growth. Wrapping up, we would proceed with caution with this company and one way of doing that would be to look at the risk profile of the business. To know the 3 risks we have identified for AH-Vest visit our risks dashboard for free. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
