CAX­TON

Share price: 1 900c JSE code: CAT

Financial Mail - Investors Monthly - - Opening Bell -

BUY CAX­TON HAS BEEN THE HOT CAT IN THE me­dia in­dus­try for some time. But in a quiet, unassertive way. It ac­tu­ally makes money out of print me­dia, with­out the hul­la­baloo of other me­dia com­pa­nies. And it has a use­ful foot in on­line me­dia through own­ing Money­web.

Co-founder and long-time boss Terry Mool­man once told this writer, over a lunch of prawns, one of his favourite dishes, that his knock ’n drops were aimed at the woman in the house. “Women make the buy­ing de­ci­sions. So I pack my pa­pers with ad­ver­tise­ments that they can choose from. And women read my pa­pers, while their hus­bands read some­thing fancy like The Econ­o­mist.”

It’s a for­mula that seems to work. The pa­pers are crammed with ad­ver­tis­ing, so com­pa­nies send ad­spend Cax­ton’s way.

Lately Cax­ton has been locked in a battle with News24, a di­vi­sion of Naspers, over al­legedly lift­ing ar­ti­cles from Money­web, giv­ing the im­pres­sion they had au­thored the sto­ries. Judg­ment is awaited.

Cax­ton has also been mak­ing ac­qui­si­tions. Mool­man is care­ful with his money but he bought Nam­pak Car­tons & La­bels for R328,4m. The ac­qui­si­tion is cred­ited with lift­ing lat­est in­terim re­sults, where head­line earn­ings per share rose by 10,7%.

The earn­ings mul­ti­ple is a pretty hefty 18,2 times, though that is the JSE’s av­er­age, and the div­i­dend yield is a not too bad 3,2%. One con­sen­sus rates Cax­ton as a buy, and IM agrees.

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