Bidvest trading update

Bidvest released a trading statement yesterday afternoon which said that for the full year to June investors should expect a jump in earnings of between 26 to 30 percent when compared to the corresponding numbers. This includes the part sale of a stake in the Mumbai airport, which netted the group 399.1 million Rands. EPS last year clocked 1110.5 cents, which means that the range should be between 1399 to 1444 cents. HEPS for the year to end June 2011 were 1157.4 cents, this increase puts the range at around 1458 to 1504 cents per share. The second half is roughly 3 percent better than the first half. At over 200 Rands, and having nearly trebled from their lows during the crisis times of 2008/2009 is the stock starting to look a little stretched? I suspect not, and further value could be unlocked with a big bang exit from Brian Joffe in the form of Bidvest restructuring.


Now there are two things that you will be surprised to learn about one of the giants of corporate South Africa (that must sit within 75 metres of us daily), first is that he is a budding and published wildlife photographer, but more importantly through his family interests does not own as many shares as folks think. In fact, according to the Major shareholders segment suggests that his family interests are 1 percent of all the shareholders, or 3 335 296 shares. As at 30 June last year. But wait, at the current price, 206.6 ZAR, that stake is worth a very cool 689 million Rands. Wow. But to think that the family interests pull the strings over at Bidvest, perhaps that is a little misled. As Paul points out, perhaps an exit by Joffe would lead to investment bankers swooping and getting excited about slicing and dicing the group to "unlock" value. But that is a while from now, I have no clear insight as to the sway that Joffe holds over the major shareholders. In the interim, one can own a steady and quality business. Results are expected on the 27th of August.