You're listening to Strictly Business Podcast with Lindsay Williams.
The JSC has closed its doors for another day, so it's time for the 5 o'clock
shadow.
And as always on a Wednesday, I speak to Skulk Lowe, Portfolio Manager at PSG
Wealth Old Oak in Cape Town.
Start where we would normally end, Skulk.
What's the all-share index, please?
Where did it close?
Oh, JSC, what a day for them.
But we'll get to that.
You actually asked me.
JSC today closed at 1.5.
5% positive.
I mean, it was a great bounce back.
I mean, we opened up slightly positive this morning, and we sort of hoovered,
hoovered up to that medium-term budget speech.
Hoovered, yeah.
Was it negative?
I mean, with the government reopening, that's optimism,
that sort of made markets in general
fairly positive this morning um but i mean as i mentioned to you a little bit earlier
i mean we i was in a
another interview it's called lunchtime ish and i had an idea what the what what
the markets did up
to that stage you know which companies performed we still had a nice nice chat
about retailers
specifically on the back yeah but but it was a general chat uh i mean i'll do some
name dropping
with mr mr shapiro And he says, I mean,
I think it's not for the widows and orphans, and he's not a trader, blah,
blah, blah, all those disclaimers.
And then he said, well, but he thinks we should be buying the Foshini Group.
And he made a valid point.
That's strange for him because he can't stand retailers.
Well, he pretty much can't stand the South African economy.
But he actually mentioned he actually is becoming… more bullish.
Very good.
And when you look at, you know, something like the Fushini Group, we quickly had a
look while we were chatting,
and we actually realized it's actually true.
The Fushini Group yesterday closed at levels that we've last seen in the midst,
in the,
let's call it that worst-case scenario environment of COVID-19 then to
2020. So we're not just at...
12-month lows.
It's a five-year low is what you're saying.
It's literally a five-year low.
So that's the backdrop.
And when I now looked at markets as it closed, I mean, wow, man.
And I still have the conversation on ShopRite.
ShopRite at that stage didn't know if we're going to be positive today or
negative.
So it was really fighting to stay positive.
Closed today at 2%.
You're up.
Peter, your Mr.
Price is 1.62% up.
In general, it was a really, really solid turnaround for, let's call it the typical
SA inks.
And banks, oh, banks, they absolutely loved it as well.
Okay, we'll come to that in a second.
So this is a good SA story, and that's aside from commodities, of course.
And there was good commodities news in the MTBPS medium-term budget policy statement,
which we'll touch on as well.
But I want to talk to you about Woolies. And I want you to look back to August,
what the price of Woolies was back in sort of August, early September time, when it
was about to be,
or was announced it would be leaving the MSCI index.
Have you got that to hand, please, Scott?
Yes, yes.
Okay, if you take August, but if you look at, I don't know where you want to get to,
because that's the same time you had that interview with Vicky, John Bacard.
And on that stage, let's call it that late July,
it actually closed at what's wrong about that, let's call it 48, 49 Rand levels.
So it's rallied about, let's call it 9 to 10 Rand per share,
which is around between 15 and 20% since the removal from the MSCI,
which is something that that person that you mentioned touched upon.
But one other thing, the reason that I...
called him was because that he believed that the the people were being too
negative
towards uh south africa much too negative uh especially uh regarding an article i
think in the
wall street journal it may have been in the washington post i don't know but he
was was bullish and given what we've seen in
the the mini budget so-called pretty good i i think that everyone was in a pretty
good mood and in fact the minister did
say You know, it's very gratifying to see that his opposite number in the
opposition,
the shadow finance minister, didn't walk out during the speech.
So everyone was sort of touchy-feely, very, very happy with each other.
And bullish for SA, Skolt, can it last?
Or will it be another government of national unity fizzle-out rally?
I don't think so.
I mean, anything can always happen with this GNU, this government of national
unity.
But I always say expect the unexpected.
But I watch the budget speech.
I felt an optimism that I didn't feel for many years.
And it wasn't an overly optimism.
It wasn't something like, oh, wow, we've got so much money.
It's just going to be beautiful.
We're going to take over the world.
Not that type of speech.
You know what it is?
I think what you're trying to say is it wasn't horrible.
No.
And it was clear targets.
We're talking about the debt.
that still should pick this year.
And they were fairly firm on that.
And we should start seeing that the debt levels decrease next year.
It was no, we should and could and might.
It was firm.
We were seeing debt peaking at this fiscal year, decreasing the next fiscal year.
They were talking about the GDP levels.
GDP levels, that's, again,
upgraded our growth for this year and telling us that we should see it in.
I think the big one was probably the expected one was the inflation numbers.
But, I mean, we're not going to get into the medium budget speech.
I know you've got a great interview lined up with 91,
and they'll sort of look at all the numbers.
They were pretty happy.
I don't want to talk behind their back or get into trouble from governance or
anything like that.
but the two people that I interviewed were generally...
sounding a little bit like you without saying it in such a forceful way that you
always do.
And that's why we love you, Skunk.
You wear your heart on your sleeve, especially when it comes to South Africa,
which is great.
Okay.
Yeah.
Anyway, a good MTBV.
So you were asking about Willis.
I think Willis, let's just run through what, because there might be a few of your
listeners out there that didn't see the
trading update.
So turnover up 6.2%.
It was.
If you look through the numbers itself,
I would say it's not something that stood out again as something being mind-blowing.
Wow, it was like 15 or 20 or whatever.
It was just solid, solid numbers.
Even from country roads, I mean, you and I, we've been vocal.
We've been, you know,
vocal on just get rid of the rubbish and just split the two companies.
the food and then the fashion beauty and just it's just but this time around i
looked through all the
numbers looked stable i mean country roads up 3.3 percent suddenly things are a
little bit more
stable and as
this gentleman we talked about earlier and and i think he mentioned something back in
the interview that he
values the the the the food business within willies I'd run about,
I think he said 53 or something like that.
Yes.
And at that stage, as you mentioned, Woolies was trading at 50 Rand.
So he said, well, you're pretty much getting the rest of Woolies for free.
We did some calcs as well.
We're actually a little bit more optimistic on that.
We valued the food business around 56 Rand per share.
And so it's actually a great… great opportunity.
And I think just add to that, they add a share buyback of 6.9 million.
So that's about 300 something million rands.
It's got 350 million rands worth of share buybacks.
Now, a company usually, you know, I've often said this on this podcast,
a company that buys back their own shares, that's a very positive sign.
Well, it's either positive.
It's positive.
Of course, it's positive because it reduces the pool.
But the other thing is they haven't got anything else to do with the money at the
moment, which sometimes if they keep on buying back,
people say, wait a second, you've got to deploy this cash, this liquidity
elsewhere.
Do something.
I know what I'd do with Woolies.
I would take all the different clothing brands and everything and scrap them.
And I'd have two.
I'd have Woolies, classic.
Which is the reasonably priced stuff.
And I'd have Woolies Select, which is something that the scalp loads of this
world would go for.
You see what I mean?
Yeah.
No, it's a good idea.
But be that as it may, it was a wonderful reaction of Mr.
Marker today.
I mean, the share price reacted 9% positive.
And yeah, long may it last for the shareholders.
I mean, this has been a company.
That's been under a bit of pressure.
And it seems like there's a bit of a pickup.
But again, when I go through the numbers, it didn't look as if…
The company is struggling, and I think one can extrapolate that again and say, well,
then South Africa might just be picking up a little bit.
And this is, again, a clothing, food retailer.
And if they're picking up, then maybe the rest of the business are picking up as
well.
This has been a bit of a rum.
Yeah, let's hope so.
Fingers crossed.
Let's move away from South Africa now.
We are unreservedly, cautiously bullish.
There you go.
Unreservedly, cautiously bullish.
on South Africa, particularly when you see some of the valuations,
which if you've got a good company that's going through hard times at the moment,
and you look back to its COVID numbers, like TFG,
for example, then have a serious look at it.
Don't plunge in, but have a serious look at it.
Now, let's talk about commodities.
The gold price went to, what did it go to?
3,000.
What am I talking about now?
Where is it now, Scott?
4,100.
It went to
4 400 wasn't that the high very very recently it's
it i'll i'll bring it up this week 4 398 it went down to very close to 3
900 so let's call it 4 400 to 3 900 rounding it up and down a
500 dollar fall it's back now just below 4 200 a natural bounce back in what has
been a long-term and bull market.
Do you believe it?
Yes.
And some might argue that it's easy now to say, but you've asked me this question, I
think, two or three weeks ago, and I told you, well,
I only see this as a bit of profit-taking.
I still very much believe that the business thesis or the investment thesis
for being invested in gold is still very much
intact.
And I mentioned it, I didn't go and buy the weakness.
I did not sell.
So I'm really happy with these levels.
We've seen two of our gold mines bring out updates yesterday and today.
Anglo Gold, was it?
Was Anglo Gold one?
Yeah.
Go on.
Nice move.
And Goldfields.
Yeah.
And Goldfields.
What was interesting, so firstly, we've seen Anglo Gold yesterday coming out with
a production report,
and that production report looked phenomenal.
I mean, and not just in a sense of...
The fact that we're going to get to the free cash flow side.
But I mean, this is typically what you want to see a gold mine do.
They mined 682,000 ounces exactly a year ago in that quarter.
And this, let's call it Q3 2025, they mined
768,000 ounces of gold.
That's a big move.
17% up.
That's just… Literally,
that's just extra gold being mined in this quarter.
That's exactly what you want to see a gold mine do when the gold price goes from
$3,000 to $4,000.
That's exactly what you want to see.
And you and I have had this conversation as well.
These gold mines are printing money.
I mean, the amount of free cash flow that they've got is just phenomenal.
So we've often said somewhere along the line,
either we're going to see a string of acquisition announcements
because effectively when you've got this amount of cash, similar to what you just
said on the Woolies scenario,
you either need to go and do transactions or you need to give the money back.
Give the money back to the shareholders in forms of dividends.
And they've made the announcement today that they...
they can change the dividend policy.
It's more a quarterly structure now, but more specifically, they're going to look
at paying 50%
of the free cash flow.
Compared to yesterday, Goldfield is also giving a positive update,
but they mentioned they're going to pay back 35% of the free cash flow.
Tell me about the margins.
This is what really gets me excited.
Can you quickly give me...
the margin they've gone from 683 000 ounces in the quarter uh the last year up
to 700 and whatever you said yes
tell me about the margins give it to me easy what did it cost them to get it out
the ground and i'll have a look at the price today
i love that okay let's let's let's use let's use agro gold because that's that's
the the biggie for today man uh the
movement that we've seen in angler gold let's give the end first you know five and
a half percent up today you know while gold
fields were down.
So that's an interesting point.
And I think, no, it's not strange.
It's when the market says, well, the one company is going to give me 50% of the
free cash flow.
The other one is going to give me 35% of the free cash flow.
That's a good enough reason.
No, it's economics 101.
But also, I mean, they did produce way more gold than gold fields over the same
time.
But yeah, I mean, you asked for it.
So, so Angelo Gold mentioned.
They've got two things.
They've got the all-in sustainable cost and the all-in cost and all-withstandable
cost.
All-in sustainable cost for this period.
Yes.
$1,720 per hour.
$1,700 versus its current price of, let's call it, $4,200.
They're printing money, Skulk.
They must get more out the ground, and they must make hay while this golden sun
shines.
That's it.
And they're doing it.
I mean, we know they're doing it.
That's what they said they're doing.
They've produced 17% more gold compared to one year ago.
So, yeah, this is just a phenomenal story.
And, you know, like I said, I think we're going to read more and more.
It's going to be a topic which we're going to be discussing quite a bit in the next,
let's call it, 6 to 12 months.
Because I think we're going to see the results.
I still firmly believe the gold price is going to remain stable at these levels.
And then you're going to see some solid, solid set of returns.
Not just results, not just only from Anglo Gold and Goldfields, but also, you know,
the… The other, the Harmonies, the Durban Ruedepo,
the Pan African, even Sabania's still water now.
You know, 50% of the EBITDA now being made up of gold.
So, yeah, it's really, really good news.
Good news on the RAND now, because the dollar RAND is 17.09.
That's a 0.4% fall for the US dollar.
British pound against the RAND is 22.42.
Euro RAND is 19.80 euro dollar.
1.1585, more or less unchanged,
but the dollar under pressure again after a period of strength, a little bit under
pressure anyway.
British pound against the US dollar, 1.3120.
Let's have a look at those commodities now with the gold price at 41.82, up one and a
third percent or $56 an ounce.
The platinum price is up $40 an ounce or two and a half percent to 16.39 and
palladium 15.02,
which is a near 2% gain.
Not such good news on other commodities that are important to South Africa.
And this is a good news commodity day for the Republic, because looking at crude
oil,
West Texas down 3.5% to 58.91.
Yes, please.
And Brent crude oil, $63.16, down 3.1%.
The all-important copper price having a really good day as well, up 1.3%
to $5.12 per pound.
That's on the COMEX in New York Commodity Exchange.
New York.
I'll start putting the London Metal Exchange price in as well, which is
dollars per tonne, but not at the moment.
Right, let's have a look at the South African bond market after the MTBPS.
Oh, goodness me.
Look at this thing.
8.66 for the
10-year. 15 basis points better from 8.81 on the closed yesterday to 8.66.
It's having a lovely day.
And the long end of the curve is 20 basis points better, you know, the 30-year, etc.
The US bond market,
we spoke two weeks ago and I said I thought we should be buying the yield,
selling the bond market at 4%.
It went to about 4.16, 4.17.
I was feeling good about it.
Still in profit.
4.06 and a half now, the US 10-year.
S&P 500 futures.
Someone said that the bubble might burst a couple of weeks, about 10 days ago or
something, and we had a bit of a wobble.
Not so now.
Steady on the S&P futures for December 6872.
Can you believe what you're hearing there?
And Bitcoin is the final one.
Bitcoin was looking horrible.
It actually broke 100,000 for a while, went up to 107.
Now, 102.610.
It looks as though it's sell the rallies, this one.
Don't you think?
I mean, we don't talk about crypto much, Skulk.
But watching the action of Bitcoin, it doesn't look good to me.
Now, I guess I'm not a Bitcoin follower,
so I'm not even going to try and I just remember it went to that let's go
120,000, went below the 100,000.
And it just you would have thought if the gold price now moving back to that
4,100, 4,000,
you would have most probably seen the let's call it the newer version of gold,
which it's been called a lot of times.
No.
Yeah.
Bitcoin moving in the same direction, but it's not.
It's struggling to keep its head above that $100,000 per Bitcoin mark.
So yeah, interesting movements there.
It is, yeah.
It really does look like sell the rallies.
I don't know anything about it either.
I just watch the price movements and look at the graphs, and it's not behaving well.
It's a sick market, as people used to say.
Right, that's it.
Scott, let's have a look at the ups and downs on the JSC.
You start today, please.
Okay, so just for interest, you actually mentioned an interesting thing.
uh uh Yeah, the oil retraced today.
And also we've mentioned the strong rally and the rand as well.
So immediately you would have thought rand stronger.
Well, no.
Cecil down.
But it wasn't.
I mean, it was sort of a general optimism on South African stocks.
Nice.
And that was up to something like 2.2% for the day.
But you were asking the winners and losers.
Let's concentrate on the winners.
Willys, naturally, the big winner for today.
I mentioned it earlier, 8.7% up.
Another company that I actually love, it's a little small company called Udeco.
That was up 5.5% for today.
And then you had Anglo Gold, 5.5%.
Momentum, that was up 5.1%.
Redefine was up 5%.
So it was a good day and a bit of a mixed bag.
It's not something that's been dominated by gold stocks or platinum stocks.
It's quite a bit of a mixed bag.
There's some gold in there.
There's some retailers and property stocks and some general industrial companies.
So that's a good sign.
Let's look at the downside.
We've had MTN, that actually dropped 2.3%.
Blue telecoms, that was down a further 2.2%.
With Suntum, interesting enough, that was down 1.5%.
And then, what is it, Bytes Technologies, 1.2%.
Interesting enough, just outside the top five,
we actually had the JSE.
you would have thought on a day like today we spoke about it didn't we we spoke about
the JSC limited what's been going on there has it been
quietly doing its thing yeah we again me and David had a
conversation today on that and
we were sort of in agreeing that the JSC is a company you can actually have
a look at I'm not invested so let's just get the T's and C's out of there I'm not
invested but But you and I,
we've been following this daily trade.
And I'm going to mention the daily trade a little bit earlier again.
But you remember, you and I had this conversation, I think, beginning of last
year.
So it's about, let's just show off two years ago.
And we said that period between 2016, 2000, it was called 18, 19-ish,
we had an average daily trade of about $220 billion per day.
And on that stage, it's beginning of last year.
We struggled, you remember, we struggled to make a 20 billion.
Yeah, we were going 15, 17 most days, wasn't it?
Exactly, exactly.
And then it turned around and lately, I mean, we're doing easily, you know,
on a daily basis, we're doing, you know, close to 30 billion.
And then you said, well, let's look at the share price.
And it was quite disappointing to see.
So, I mean, I would just say this is an interesting one to be monitoring.
You're keeping me hanging here.
Let's hear the numbers, please.
The share price.
What has it done?
Give it to me.
Down 1%.
In a market that has been bullish.
I mean, the JSE all share really been running,
but the JSE actual share price down 1%.
Again, just maybe something to monitor.
We've heard today Fidelity Security, a Volvon's company,
they are planning to have an IPO.
on this company we've recently had optasia um there's going to be celci being listed
so there's
a few few new companies coming towards the the jse plus looking at volumes in general
picking up i
mean just maybe just maybe make a note let you and i we we're gonna we're gonna mark
this jc kind of trading at
135 round levels We're going to check this again.
Ask that Shapiro fellow next time you see him next week when you're on telly
together.
Just say, listen, when's your competition starting?
Because Lindsay and I are going to put the JSC Limited in your new competition.
Well, I am anyway.
Give us the indices, please.
All good news, I hope.
And also, tell me what the Platinums did, because we haven't mentioned them.
Please go ahead.
Okay, let's quickly have a look here.
yeah well i know sebastian stillwater had a whopper but actually that's that's
that's that's that's some some gold as well
uh impala platinum that was up 2.2 percent um northern platinum that was up
3.04 percent uh
if we look at volterra volterra 2.91 percent and as i mentioned um and
sebastian stillwater up 3.4
percent so pgm's rocking rocking the jse for sure um Talking about the JSC, I mean,
as you mentioned earlier, the JSC closed the day at 112,908 points.
That was up 1.55%.
Being led by the resource index, that was up 2.2%, slightly followed by the
financial index.
That was up just over 2%.
The asset property index, that was, let's call it fourth in line, third in line.
That was 1.6% up.
And industrials.
Maybe just struggling a bit with the stronger RAND.
That was up 0.87% for today.
And now the value traded, as mentioned, again, today, another 25 billion traded
through the market.
So, yeah, positive all in all.
Very good indeed, Skulk.
Thanks very much.
I've kept you late, but it was well worth it.
A really, really good day all around.
Everything came to the party.
Skulk, though, is a portfolio manager at PSG Wealth Old Oak in Cape Town.
And that was the 5 o'clock shadow.
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