News in South Africa 12th February:
1. Unemployment highest on record:
The official unemployment numbers for the fourth quarter of 2019 remained unchanged at 29.1% – the highest rate since 2008 – compared to the third quarter of 2019, Statistics South Africa announced on Thursday.
The number of employed persons increased by 45 000 to 16.4 million and the number of unemployed persons decreased by 8 000 to 6.7 million in the fourth quarter. There was a resultant increase of 38 0000 employed people, according to Statistics SA’s Quarterly Labour Force Survey.
The formal sector recording the largest employment increase of 117 000, followed by the agriculture sector, which employed 6,000 more people.
2. PepsiCo’s takeover of Pioneer Foods approved:
The Competition Commission has recommended that the Competition Tribunal give the green light to a R24bn transaction that will see PepsiCo take over Pioneer Foods, the Commission said in a statement on Monday.
The deal’s benefits are “significant”, the Commission said, while recommending that it be approved subject to conditions including job creation, local investment and a minimum R1.6 billion B-BBEE transaction.
In 2019, New York-headquartered PepsiCo offered R110 per share – a premium of around 56% – to acquire Pioneer Foods, which manufactures brands including Weet-Bix, Sasko, Pro-Nutro and Spekko rice.
3. No load shedding today:
Eskom has announced that load shedding will not be implemented on Wednesday.
“While the system remains vulnerable, several units have returned successfully and good progress has been made in replenishing emergency reserves,” said the power utility in a power status update.
Eskom warned, however, that power cuts could be implemented at short notice if there are shifts on the system and repeated its request for customers to use electricity sparingly.
4. Factory output slumped in December:
South Africa’s manufacturing production fell by 5.9% in December 2019 compared with December 2018, Stats SA announced on Tuesday.
This was the seventh consecutive month of decline, and the biggest year-on-year fall since July 2014, when production slumped by -7% according to Stats SA data.
The biggest decline was in the motor vehicles, parts and accessories and other transport equipment sector, where annual output fell by -24,9%.
Steel and Engineering Industries Federation of Southern Africa economist Marique Kruger, said in a statement that the weak manufacturing data would dampen the mood ahead President Cyril Ramaphosa’s State of the Nation address on Thursday.
5. MTN expects a headline earnings rise of 50%:
Telecoms giant MTN expects headline earnings per share for the year ended December 2019 to increase by between 30% and 50%, it said in a trading statement on Tuesday.
It has adopted a new financial reporting system from 1 January 2019, which it expects to result in a 13% downward adjustment, it said.
This also comes as MTN undertakes several major projects, including the introduction of a mobile money service in South Africa with Ubank, and the deepening of its investment in the Nigerian market by over R20 billion, Fin24 previously reported.
The company said it expected headline earnings per share of between 438 cents and 506 cents in 2019, compared with HEPS of 337 cents for the prior financial year.