All Eyes on Local Releases Next Week

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Locally, a less eventful week is on the cards:

  • Oceana (JO: OCEJ ) Group (Full-Year Results): Bloomberg consensus expects FY21 earnings to increase 3.4% y/y. In SA, the company expects canned fish and fishmeal to remain under volume pressure, but management will look to navigate the stronger rand and focus on ongoing production efficiencies. In the rest of Africa, fresh fish offerings continue to show strong demand. The US operations are well positioned for volume growth with the addition of a 12th vessel and the introduction of a run-boat for the 2021 fishing season. Growth in pet food and global aquaculture continues to drive positive pricing for fishmeal and fish oil in all geographies.
  • Vukile Property Fund (Interim Results): Bloomberg consensus expects distributions per share for the full year to contract 3.1% y/y. During FY21 results, management said the dividend payout ratio will be ~60% to 70% of total group funds from operations (while still maintaining the minimum 75% of JSE defined distributable income requirement), lower than the current year’s 79%.
  • Alexander Forbes (JO: AFHJ ) (Interim Results): In FY21, headline earnings per share (HEPS) fell 64% but HEPS from continuing operations increased by 4%. Operating income was flat. Assets under management and administration increased to R401 billion - up 29%.
  • From a corporate actions perspective, Tuesday marks the last day to trade Afrimat (JO: AFTJ ), Grand Parade Investments (JO: GPLJ ), Investec PLC Preference Share, Naspers (JO: NPNJn ), Ninety One, Oasis Crescent Property Fund (JO: OASJ ), Pan African Resources (JO: PANJ ), Pick n Pay (JO: PIKJ ) Stores, Raubex Group (JO: RBXJ ), Redefine Properties (JO: RDFJ ), Stor-Age Property REIT, Textainer Group Holdings, Tradehold, Transaction Capital (JO: TCPJ ),Vodacom Group, and Grindrod Shipping Holdings to receive their most recently declared distributions.
  • Ascendis Health (JO: ASCJ ), Choppies Enterprises, Mustek, Cashbuild (JO: CSBJ ), Fortress REIT, Anchor Group, Europa Metals, London Finance & Investment Group PLC, FirstRand (JO: FSRJ ), OneLogix Group, Tsogo Sun (JO: TSGJ ) Gaming, African Rainbow Minerals (JO: ARIJ ), EOH Holdings (JO: EOHJ ), Murray & Roberts Holdings (JO: MURJ ), Alaris Holdings, African and Overseas Enterprises, Rex Trueform Group, Transpaco and Imbalie Beauty will host AGMs in the upcoming week. Invicta Holdings will host a GM and the GM for the possible Investec Preference Share repurchase will also take place this week

In the US results are expected from Hewlett Packard Enterprise, Salesforce.com (NYSE: CRM ), Kroger (NYSE: KR ), Dollar General (NYSE: DG ), and The Gap Inc (NYSE: GPS ). By Thursday evening, with 487 out of 500 S&P 500 companies (or 97.4%) having reported results, 67.7% of companies reported better-than-expected revenue and 81.9% reported better-than-expected earnings. The average revenue surprise was 2.6% and the average earnings surprise was 9.2%. Average revenue growth was 17.5% and average earnings growth was 40.8%.

  • Hewlett Packard (NYSE: HPE ) Enterprise expects FY22 non-GAAP operating profit growth to range 10% to 15% and non-GAAP diluted net EPS to be between $1.96 to $2.10. Free cash flow is guided to range $6.5 billion to $7.0 billion between FY22 and FY24. Management expects to return at least 60% of free cash flow to shareholders in FY22, including approximately $625 million in dividends and at least $500 million of share repurchases.
  • While Salesforce.com's (NYSE: CRM ) 3Q21 EPS is anticipated to fall close to 50% y/y off a high base, sales are anticipated to grow 25% y/y to $6.8 billion on higher spending across Cloud-CRM suite of Apps and acquisition-related gains.
  • Dollar General’s 3Q21 EPS is expected to fall contract 13% y/y, with same store sales down 1% y/y amid lingering stimulus spending, a strong back-to-school season and child tax credits. Pressure on gross margin is expected to persist in 3Q22 and into 2022 due to product-cost inflation and elevated transportation expense.
  • Kroger expects same-store sales momentum to strengthen in 3Q22, returning to growth. Gross-margin challenges may persist as the company seeks to balance investments in the business, maintaining low prices, cutting operating expenses and driving productivity. Alternative revenue could show strength in 3Q22 fuelled by Kroger’s Retail Media and Personal Finance areas.

A quieter week is anticipated in Europe and the Asia-Pacific region with a very few companies scheduled to publish results.

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