JSE likely to open weaker as global gloom returns to markets

JSE-listed company result releases pick up after a lull this week, starting with staffing and training group Adcorp and industrial holding company Insimbi.

Adcorp said on September 27 that it expected to report on Monday a return to profitability in the six months to end-August.

It expects to turn from a headline loss per share from continuing operations in the first half of its 2017 financial year of 28.2c to headline earnings per share (HEPS) of up to 90c.

The group said it expected to report the headline loss per share from discontinued operations narrowed to about 0.5c from 11.9c.

“The clean-up of the group in 2018 financial year enabled the leadership team to gain an understanding of its true financial position and reset performance,” the trading update said.

“This represented the first phase of the group’s strategic transformation. The focus in the current year is on stabilising operations, stemming losses from our training business and unlocking short-term wins as we develop a blueprint for the future of Adcorp.”

Insimbi warned shareholders on 21 September that it expected to report an about 25% drop in interim HEPS for the six months to end-August.

Insimbi said that it recovered in the second quarter of its financial year from a bad start in which it lost 20 working days to labour unrest and public holidays.

“However, the second financial quarter from June 1 to August 31 proved to be an exceptional one, with impressive revenue growth and improved margins as a result of the weakening of the currency.

“Group revenue has increased by over 20% compared to the corresponding period and this trend looks set to continue into the second half of the year. August was a particularly good month for the group, with revenue of approximately R500m and an improvement in margins,” the trading statement said.

The pound and euro are likely to weaken on Monday as the market reacts to Sunday’s news of stalled Brexit negotiations and Germany’s ruling party suffering a defeat in regional elections in Bavaria.

The rand was trading at R14.51/$, R16.76/€ and R19.03/£ at 6.45am.