JSE Friday Wrap: Resources shine as Crookes Brothers warns of near-total earnings wipeout

The JSE finished Friday on a broadly constructive note, with the All Share advancing 2.24% as commodity-linked indices led the charge. The Resource 20 surged 4.72% and Precious Metals & Mining climbed 5.73%, driven by a rebound in gold and platinum group metal prices. Sasol dragged on the Chemicals sector with a 6.47% fall, while AngloGold Ashanti and Impala Platinum were among the top performers. Mining stocks broadly outperformed as investors rotated into safe-haven precious metals ahead of key US economic data releases.

CKS Crookes Brothers warns of 93-99% HEPS collapse and R256m impairment

Crookes Brothers trading statement paints a grim picture of operational distress across virtually every segment of the business. Headline earnings per share are projected to collapse by between 93% and 99% year-on-year, leaving shareholders with HEPS of just 2.35 to 27.85 cents against a prior-year base that already carried its own difficulties. The group has also swung to a basic loss of up to 1,705 cents per share, a dramatic reversal from the prior year's profit of 446.4 cents per share.

The most striking element of Friday's announcement is a R256 million capital impairment specifically targeting the Macadamia segment, a figure that approaches the company's entire market capitalisation and signals fundamental doubts about the long-term value of that asset base. This impairment is excluded from headline earnings calculations and therefore does not directly compound the HEPS decline, but it underscores the severity of structural problems that extend well beyond short-term commodity price volatility.

Broader operational pressure compounds the impairment. Lower sugar prices have weighed on the agriculture segment, while delayed land sales have failed to generate the anticipated liquidity injection. These are preliminary unaudited figures, but the magnitude of the decline is structurally significant and leaves little room for interpretive optimism. Investors holding CKS should note that the earnings collapse is broad-based rather than isolated to one division, suggesting that the recovery path, if one exists, will require meaningful time and capital to rebuild.

ANG AngloGold schedules July general meeting for $2.0bn share buyback approval

AngloGold Ashanti GM notice formally set the procedural timeline Friday for one of the largest capital-return proposals in recent JSE history. A General Meeting has been scheduled for 23 July 2026 at which shareholders will be asked to approve a $2.0 billion share repurchase programme that was previously announced but requires formal voting authority before implementation. The last-day-to-trade for JSE and A2X shareholders to be eligible to participate in the vote is 23 June 2026.

The announcement is a mechanical governance step rather than the commencement of actual market repurchases. Management explicitly retains full discretion over the timing, pricing, and ultimate quantum of any buybacks that may follow approval, and the programme is contingent on future cash flow availability, market conditions, and overall financial performance. There are no specific pricing parameters or a committed start date disclosed.

For investors, the proposal represents a significant potential catalyst given the scale of the proposed capital return. The shares gained 7.28% on Friday to close at R1,392.62, partly reflecting pre-positioning ahead of the shareholder vote. Retail investors holding AngloGold through the 23 June record date will be eligible to exercise their voting rights and should assess whether they wish to support the mandate as structured.

VUN Vunani swings from loss to profit with HEPS of 10.9 to 11.5 cents

Vunani trading update for the year ended 28 February 2026 confirms a meaningful return to profitability following a prior-year loss-making period. Headline earnings per share are projected at 10.9 to 11.5 cents, compared to a headline loss of 2.8 cents in the prior year. Basic earnings per share is expected to be 5.3 to 6.7 cents against a prior loss of 7.1 cents, representing a full swing to positive territory on both metrics.

The magnitude of the turnaround is clear, but a notable divergence between basic and headline earnings flags earnings-quality questions that investors should not overlook. The gap between the two metrics implies the presence of significant non-recurring charges or impairments that are excluded from headline calculations but still weigh on statutory profit. This asymmetry makes it difficult to assess the true quality and sustainability of the recovery without the full audited results.

The company cancelled an earlier trading update that contained an administrative error regarding the financial year, reissuing corrected figures later the same morning. Full audited results are scheduled for release on or about 23 June 2026, at which point investors should scrutinise the cash flow statement and balance sheet to determine whether the earnings recovery is translating into genuine cash generation rather than one-off accounting adjustments.

KAP KAP guides for over 50% HEPS growth and R500 million net debt reduction in FY26

KAP operational update confirms its operational turnaround is translating into measurable financial progress. Headline earnings per share is expected to increase by more than 50% to at least 36.2 cents for the financial year ending 30 June 2026, representing a credible acceleration from the prior year's depressed base. The headline recovery is supported by improving performance at the Unitrans logistics division, which has set a medium-term profit target of R700 million, and a 33% capacity increase at PG Bison's new medium-density fibreboard production line.

Management has also set an explicit balance sheet target of reducing net debt by R500 million during the period, addressing a key concern among investors who have monitored the group's leverage through its restructuring phase. Lower capital expenditure and improved cash flows are expected to support the deleveraging trajectory, though the filing does not disclose free cash flow figures that would fully validate the progress.

Not every corner of the portfolio is firing. Safripol continues to face severe headwinds from global overcapacity and cheap imports, with two commercial shutdowns at its PET plant in Durban. The Optix division reported an increased operating loss as subscription growth was offset by weaker hardware revenues. The optical improvement in basic EPS is partly a mechanical base effect from the non-recurrence of prior-year impairments, so investors should focus on the headline trajectory and debt reduction as the most credible indicators of genuine operational momentum.

SEB Sebata reports dramatic turnaround to R105 million profit and 100.66 cents HEPS

Sebata Holdings released its audited annual results for the year ended 31 March 2025, confirming one of the most dramatic bottom-line recoveries on the JSE this reporting season. Revenue surged to R268.7 million from just R33.1 million in the prior year, propelling the group from a comprehensive loss of R112.7 million to a total comprehensive profit of R105.1 million. Headline earnings per share recovered to 100.66 cents against a headline loss of 102.20 cents previously, and basic earnings per share came in at 91.17 cents versus a prior loss of 100.29 cents.

The audited financial statements received an unmodified opinion from the external auditors, which provides assurance regarding the reliability of the reported numbers. The scale of the recovery is not in doubt at the headline level. However, the board declared no dividend, choosing to retain cash for reinvestment purposes rather than distributing profits to shareholders.

For investors, the optical earnings beat is spectacular, but the absence of a dividend raises questions about cash conversion and management's confidence in the sustainability of the current earnings trajectory. The stock traded flat on the day despite the strong numbers, which may reflect deep scepticism given historical volatility or limited market liquidity rather than any specific concern disclosed in the filing. Full cash flow and balance sheet scrutiny is warranted before treating the turnaround as fully established.

CLI Clientèle delisting and R19.90 buy-back offer cleared by shareholders

Clientèle GM results has become largely unconditional following shareholder approval at the General Meeting held Friday. The final offer consideration is confirmed at R19.90 per share, representing the exit price that remaining minority shareholders can expect to receive if they accept the offer. The AEI Specific Issue, which involves share issuances to certain parties as part of the transaction structure, has also become unconditional and is set for implementation on 22 June 2026.

The transaction remains subject to a Maximum Acceptances Condition, which introduces a residual layer of execution uncertainty. The resolution of the shareholder vote removes the most significant procedural hurdle, but investors should be aware that the final completion of the offer is not yet fully guaranteed until the acceptances threshold is reached.

The shares traded at approximately R19.54 ahead of Friday's announcement, leaving a negligible spread to the R19.90 exit price. For retail investors wishing to exit, acceptances should be submitted before the offer closes to lock in the consideration. The arbitrage opportunity that may have attracted some traders has largely closed following the GM approval, leaving little incremental value from here.

What we are watching

Next week brings a busy corporate calendar, including Vunani's full audited results scheduled for release on or about 23 June 2026, which should clarify the earnings-quality concerns flagged by the divergence between basic and headline figures. Vodacom has confirmed its Annual General Meeting for 21 July 2026, and Clientèle's Specific Issue implementation is set for 22 June 2026. Investors should also monitor whether the Maximum Acceptances Condition for Clientèle's delisting offer is satisfied in the coming days.