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NAMPAK LTDNAMPAK LTDNAMPAK LTD

NAMPAK LTD

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Our opinion on the current state of NAMPAK(NPK)Nampak (NPK) is Africa's largest packaging company with interests in South Africa and ten other African countries. About 60% of its turnover comes from South Africa, but only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and only 31% of turnover. The company also has small interests in the UK and Ireland. It produces four kinds of packaging products - plastics, metals, paper, and glass. The great preponderance of its trading profits come from metals - which consists mainly of beverage cans. Nampak has been able to remove R3,5bn (US$265m) of surplus cash from Zimbabwe, Nigeria, and Angola. Importantly, management appears to have the ability to re-patriate profits from the various African countries where it operates. It has halted its strategy of expanding into Africa after writing down its businesses in Angola and Nigeria by R3bn. COVID-19 and the fall in the oil price have impacted on its results in Nigeria and South Africa. It is also benefiting from the news that it will not need to sell assets or do a rights issue to pay back debt of just under R6bn. The announcement that it would raise R1,35bn through a rights issue to reduce debt caused the share to fall 30%. The rights offer was reduced from R2bn to R1,5bn and shareholders finally gave permission to raise up to R1bn on 30th June 2023. On 20th April 2023 the CEO, Eric Smuts, resigned with immediate effect and was replaced by Phil Roux. In its results for the six months to 31st March 2024 the company reported revenue up 7% and headline earnings per share (HEPS) of 5 393.9c per share compared to headline loss of 11 027.3c in the previous period. The company said, "Despite declines in revenue in DivFood and Bevcan Angola, Metals recorded a 6% increase in revenue boosted by growth achieved with Bevcan South Africa, while Plastics and Paper posted 9% and 10% increases in revenue respectively." In an update on 1st October 2024 the company said, "In September 2024 the group successfully concluded the refinancing of the group, utilising a significantly simplified funding structure, inclusive of only a minor foreign debt component. The Standard Bank of South Africa financed the transaction in full." On 16th May 2024 the company announced that it had sold its entire Nigerian operation for $68,5m. In a trading statement for the year to 30th September 2024 the company estimated that HEPS would be between 3100c and 3500c compared with 39004,6c in the previous period. This caused the share price to drop sharply. The share remains in an upward trend, but it is a volatile commodity share.
JSE:NPK
by PDSnetSA
Our opinion on the current state of NAMPAK(NPK)Nampak (NPK) is Africa's largest packaging company, operating in South Africa and ten other African countries. While 60% of its turnover comes from South Africa, only 36% of its trading profit is generated there, with the rest of Africa accounting for 59% of trading profit from just 31% of turnover. Nampak has smaller operations in the UK and Ireland. The company produces four types of packaging products: plastics, metals, paper, and glass, with metals—primarily beverage cans—contributing the majority of its trading profits. One of Nampak's key achievements has been its ability to repatriate profits from countries like Zimbabwe, Nigeria, and Angola, from which it has removed R3.5 billion (US$265 million) in surplus cash. Although Nampak has halted its African expansion strategy after writing down its Angola and Nigeria businesses by R3 billion, it has shown resilience amid challenges like COVID-19 and oil price declines, particularly in Nigeria and South Africa. The company has faced significant debt issues, leading to a decision to raise R1.35 billion through a rights issue, which initially caused the share price to drop by 30%. Although the rights offer was reduced from R2 billion to R1.5 billion, shareholders ultimately approved raising up to R1 billion by 30th June 2023. Leadership changes also marked a significant development, with CEO Eric Smuts resigning in April 2023 and being replaced by Phil Roux. In its financial results for the six months ending 31st March 2024, Nampak reported a 7% revenue increase and a sharp turnaround in headline earnings per share (HEPS) of 5,393.9c, compared to a headline loss of 11,027.3c in the previous period. Metals, despite declines in DivFood and Bevcan Angola, posted a 6% revenue increase, driven by growth in Bevcan South Africa, while Plastics and Paper saw 9% and 10% revenue increases, respectively. On 1st October 2024, Nampak announced it had successfully refinanced the group with a significantly simplified funding structure, mainly funded by Standard Bank of South Africa with minimal foreign debt exposure. This followed the sale of its entire Nigerian operation for $68.5 million in May 2024, which triggered a clear on-balance-volume (OBV) buy signal. Another OBV buy signal followed on 20th June 2024 at R228 per share, with the share price rising to R447.74 since then. Given these developments, we believe that Nampak is positioned to continue performing well, particularly as it benefits from a stronger balance sheet, operational improvements, and streamlined funding.
JSE:NPK
by PDSnetSA
2
Our opinion on the current state of NAMPAK(NPK)Nampak (NPK) is Africa's largest packaging company with interests in South Africa and ten other African countries. About 60% of its turnover comes from South Africa, but only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and only 31% of turnover. The company also has small interests in the UK and Ireland. It produces four kinds of packaging products - plastics, metals, paper, and glass. The great preponderance of its trading profits come from metals - which consists mainly of beverage cans. Nampak has been able to remove R3,5bn (US$265m) of surplus cash from Zimbabwe, Nigeria, and Angola. Importantly, management appears to have the ability to repatriate profits from the various African countries where it operates. It has halted its strategy of expanding into Africa after writing down its businesses in Angola and Nigeria by R3bn. COVID-19 and the fall in the oil price have impacted its results in Nigeria and South Africa. It is also benefiting from the news that it will not need to sell assets or do a rights issue to pay back debt of just under R6bn. The announcement that it would raise R1,35bn through a rights issue to reduce debt caused the share to fall 30%. The rights offer was reduced from R2bn to R1,5bn, and shareholders finally gave permission to raise up to R1bn on 30th June 2023. On 20th April 2023, the CEO, Eric Smuts, resigned with immediate effect and was replaced by Phil Roux. In its results for the six months to 31st March 2024, the company reported revenue up 7% and headline earnings per share (HEPS) of 5 393.9c per share compared to a headline loss of 11 027.3c in the previous period. The company said, "Despite declines in revenue in DivFood and Bevcan Angola, Metals recorded a 6% increase in revenue boosted by growth achieved with Bevcan South Africa, while Plastics and Paper posted 9% and 10% increases in revenue respectively." On 16th May 2024, the company announced that it had sold its entire Nigerian operation for $68,5m. This resulted in the share giving a clear on-balance-volume (OBV) buy signal. A second OBV buy signal came on 20th June 2024 at R228 per share. Since then, it has moved up to R285.50. We believe that it will continue to perform.
JSE:NPK
by PDSnetSA
Our opinion on the current state of NAMPAK(NPK)Nampak (NPK) is Africa's largest packaging company, operating primarily in South Africa and ten other African countries. While 60% of its turnover originates in South Africa, the country contributes only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and 31% of turnover. Nampak also has a smaller presence in the UK and Ireland. The company produces four types of packaging: plastics, metals, paper, and glass, with the majority of trading profits coming from metals, mainly beverage cans. Nampak has successfully repatriated R3.5 billion (US$265 million) in surplus cash from Zimbabwe, Nigeria, and Angola, showcasing its management's ability to return profits from its African operations. After writing down its Angola and Nigeria businesses by R3 billion, the company halted its African expansion strategy. COVID-19 and the drop in oil prices have impacted its results in Nigeria and South Africa. Initially, Nampak aimed to raise R2 billion through a rights issue to repay its nearly R6 billion debt. However, the rights offer was reduced to R1.5 billion, with final approval to raise up to R1 billion on 30th June 2023. Despite reducing the rights offer, the announcement caused a 30% drop in the share price. In its financial results for the year ending 30th September 2023, the company reported revenue down by 2% and recognized a significant foreign exchange loss of R1.2 billion. The report showed net impairments totaling R2.8 billion, which included goodwill impairment in Bevcan Nigeria (R1.5 billion), asset impairment in Bevcan Angola (R827 million), DivFood asset impairment (R290 million), and Rigids impairment (R175 million). These impairments accounted for 61% of the group's previously reported shareholders' equity of R4.7 billion. The company experienced an attributable loss of R4 billion, resulting in a headline loss of R468.11 per share, compared to a profit of R75.89 per share in the previous year. The net asset value fell to 19,810 cents per share from 183,723 cents. In an update for the quarter ending 31st December 2023, Nampak indicated improved operational and trading performance in Bevcan SA and DivFood through margin management, cost reduction, and efficiency gains. Bevcan Angola saw a volume recovery, and reduced forex losses contributed to a better operating profit. The share, which once peaked at over R45 in November 2014, became a penny stock before a 250-for-1 consolidation on 26th July 2023. The company is seen as recovering, but its vulnerability to economic and political developments across African countries makes it a risky proposition, especially after recent challenges faced by other firms like MTN in Nigeria. On 20th April 2023, CEO Eric Smuts resigned, and Phil Roux took over. Investors are advised to wait for the share to break through the downward trend following the rights issue on 6th September 2023. On 9th May, the company announced that it would publish its interim results for the six months ending 31st March 2024 on 28th June 2024, following a "cyber incident."
JSE:NPK
by PDSnetSA
Our opinion on the current state of NPKNampak, Africa's leading packaging company, operates across South Africa and ten other African countries. Despite deriving about 60% of its turnover from South Africa, only 36% of its trading profit originates from the country. In contrast, the rest of Africa contributes to 59% of its trading profit from just 31% of turnover, highlighting the significant role its African operations play in its financial health. Nampak's product range spans plastics, metals, paper, and glass, with the bulk of its trading profits generated from its metal packaging products, particularly beverage cans. The company has successfully repatriated R3.5 billion (US$265 million) of surplus cash from Zimbabwe, Nigeria, and Angola, showcasing management's adeptness at repatriating profits from various African nations where it operates. However, Nampak has paused its African expansion strategy following a R3 billion write-down in its Angolan and Nigerian businesses. The impact of COVID-19 and oil price fluctuations have notably affected its operations in Nigeria and South Africa. Nevertheless, Nampak has managed to avert the need for asset sales or a rights issue to service its debt, which is just under R6 billion. The plan to raise R1.35 billion through a rights issue to reduce debt initially caused the share price to drop by 30%. This rights offer was later adjusted from R2 billion to R1.5 billion, with shareholder approval eventually secured for raising up to R1 billion on 30th June 2023. For the year ending 30th September 2023, Nampak reported a 2% decrease in revenue and a significant R1.2 billion foreign exchange loss. The company also recognized net impairments of R2.8 billion, attributed to various asset impairments across its operations, which accounted for 61% of the group's last reported shareholders’ equity of R4.662 million. This resulted in an attributable loss of R4 billion, marking a drastic shift from the previous year's profit, and led to a headline loss of R468.11 per share. Nampak's net asset value also saw a significant reduction. Despite operational and trading performance improvements in some divisions and reduced forex losses contributing to better operating profit in the subsequent quarter, Nampak's financial journey has been tumultuous. The share experienced a peak over R45 in November 2014 but has since become a penny stock, hitting lows around 65c before undergoing a 250-for-1 consolidation on 26th July 2023. The company is perceived to be recovering, yet it remains sensitive to developments across its African operations, adding to its risk profile. The resignation of CEO Eric Smuts in April 2023 and his replacement by Phil Roux marked another significant change in leadership. Given the complexities of Nampak's operational landscape and the inherent risks associated with its African market exposure, potential investors are advised to exercise caution and consider waiting for the share to break upwards through the downward trend initiated after the rights issue on 6th September 2023 before making investment decisions.
JSE:NPK
by PDSnetSA
Our opinion on the current state of NPKNampak (NPK) is Africa's largest packaging company with interests in South Africa and ten other African countries. About 60% of its turnover comes from South Africa, but only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and only 31% of turnover. The company also has small interests in the UK and Ireland. It produces four kinds of packaging products - plastics, metals, paper, and glass. The great preponderance of its trading profits come from metals - which consists mainly of beverage cans. Nampak has been able to remove R3,5bn (US$265m) of surplus cash from Zimbabwe, Nigeria, and Angola. Importantly, management appears to have the ability to re-patriate profits from the various African countries where it operates. It has halted its strategy of expanding into Africa after writing down its businesses in Angola and Nigeria by R3bn. COVID-19 and the fall in the oil price have impacted on its results in Nigeria and South Africa. It is also benefiting from the news that it will not need to sell assets or do a rights issue to pay back debt of just under R6bn. The announcement that it would raise R1,35bn through a rights issue to reduce debt caused the share to fall 30%. The rights offer was reduced from R2bn to R1,5bn and shareholders finally gave permission to raise up to R1bn on 30th June 2023. In its results for the year to 30th September 2023 the company reported revenue down 2% and the company reported a massive R1,2bn foreign exchange loss. The company said, "The net impairments of R2.8 billion recognised at 30 September 2023 consisted of the impairment of goodwill in Bevan Nigeria of R1.5 billion, Bevcan Angola asset impairment of R827 million, DivFood asset impairment of R290 million and Rigids impairment of R175 million. These impairments represent 61% of the group’s last reported shareholders’ equity of R4 662 million." The company made a attributable loss of R4bn which translated into a headline loss R468,11 per share which compares with a profit of R75,89 per share in the previous year. The company's net asset value fell to 19810c per share from 183723c. The share peaked at over R45 in November 2014 and then fell back to become a penny stock at low around 65c. It then did a 250-for-1 consolidation on 26th July 2023 and the company has generally been seen as being on the mend. It is still trading at a fraction of its net asset value (NAV). The share looks cheap, but it is vulnerable to developments in a variety of African countries which is perceived to add significantly to risk, especially after what the Nigerian government has done to MTN. On 20th April 2023 the CEO, Eric Smuts resigned with immediate effect and was replaced by Phil Roux. Our advice is to wait for the share to break up through the downward trend which began after the rights issue on 6th September 2023.
JSE:NPK
by PDSnetSA
Our opinion on the current state of NPKNampak (NPK) is Africa's largest packaging company with interests in South Africa and ten other African countries. About 60% of its turnover comes from South Africa, but only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and only 31% of turnover. The company also has small interests in the UK and Ireland. It produces four kinds of packaging products - plastics, metals, paper, and glass. The great preponderance of its trading profits come from metals - which consists mainly of beverage cans. Nampak has been able to remove R3,5bn (US$265m) of surplus cash from Zimbabwe, Nigeria, and Angola. Importantly, management appears to have the ability to re-patriate profits from the various African countries where it operates. It has halted its strategy of expanding into Africa after writing down its businesses in Angola and Nigeria by R3bn. COVID-19 and the fall in the oil price have impacted on its results in Nigeria and South Africa. It is also benefiting from the news that it will not need to sell assets or do a rights issue to pay back debt of just under R6bn. The announcement that it would raise R1,35bn through a rights issue to reduce debt caused the share to fall 30%. The rights offer was reduced from R2bn to R1,5bn and shareholders finally gave permission to raise up to R1bn on 30th June 2023. In its results for the six months to 31st March 2023 the company reported revenue up 4% and a headline loss of 54,5c per share after impairments of R2,4bn. The company said, "A rigorous cost reduction program, business remodelling and significant reduction in net working capital will be fundamental to our efforts in the short term. The divestiture program requires increased impetus as a critical enabler to reducing our debt encumbrance to manageable levels". In a trading statement for the year to 30th September 2023 the company estimated that it would make a headline loss of between 46100c and 46700c per share compared with a profit of 7589,2c in the previous year. The loss is due to impairments, forex losses and higher finance costs. In our view, the share will benefit directly from any improvement in the South African economy while profiting from growth in the rest of Africa. Obviously, rising commodity prices are a problem. The share peaked at over R45 in November 2014 and then fell back to become a penny stock at low around 65c. It then did a 250-for-1 consolidation on 26th July 2023 and the company is generally seen as being on the mend. It is still trading at a fraction of its net asset value (NAV). The share looks cheap, but it is vulnerable to developments in a variety of African countries which is perceived to add significantly to risk, especially after what the Nigerian government has done to MTN. On 20th April 2023 the CEO, Eric Smuts resigned with immediate effect and was replaced by Phil Roux.
JSE:NPK
by PDSnetSA
Nampak about to pack an upper cut punch up to R494.59W Formation has formed on Nampak. The price has broken up and is showing it's reached a bottom and buyers will start piling in here. Otehr indicators confirm. 7>21 - Bullish Price>200 - Bullish and it's the first time in MONTHS since we've seen the bull crossover. RSI>70 Target 1 will be to R494.59 ABOUT THE COMPANY Packaging Solutions: Nampak is a leading provider of packaging solutions in Africa, offering a wide range of packaging products across various industries. Founded in 1968: Nampak was founded in 1968 in Johannesburg, South Africa. Pan-African Presence: The company operates in several African countries, including South Africa, Nigeria, Angola, Zimbabwe, and more, making it one of the largest packaging companies on the continent. Diverse Product Range: Nampak's product portfolio includes metal packaging, glass packaging, paper and board packaging, and plastic packaging. Metal Packaging: Nampak produces metal packaging products such as cans, beverage cans, aerosol cans, and metal closures for various consumer goods. Glass Packaging: The company manufactures glass containers for beverages, food, and other products. Paper and Board Packaging: Nampak provides paper-based packaging solutions, including cartons, folding cartons, and corrugated packaging for various industries. Plastic Packaging: The company produces plastic packaging for a wide range of applications, including bottles, containers, and other plastic products. Sustainability Initiatives: Nampak has implemented various sustainability initiatives to reduce its environmental impact, such as recycling programs and sustainable packaging solutions. International Operations: In addition to its African operations, Nampak also has international operations in the United Kingdom, Ireland, and Europe.
JSE:NPKLong
by Timonrosso
2
$JSENPK - Nampak: Leading Diagonal, Debt, Rights Issues...I will not dwell on the history of Nampak, its certainly had better days both as a company and as a stock. Before even thinking of taking a punt i highly recommend you you read, in detail, the Trading Statement released on SENS on 2022.12.01 and the subsequent annual results released on 2022.12.05 The company is riddled with debt and its operational ability is an ongoing concern and a circular will be published around 2022.12.15 on the proposed rights issue to raise capital. Technically, from an EWP perspective, the advance from the September 2020 low of 54 zac to R4,49 unfolded in five overlapping waves consistent with a leading diagonal for wave 1 or A. The correction has been well contained in a descending channel but for the wave 1 or A count to remain valid, price must hold above 54 zac. This is purely a speculators stock and we can expect some volatility with the upcoming announcements on the rights issue.
JSE:NPK
by Loyiso_BlaqueSoros_Mpeta