RE­TURN ON AS­SETS

Finweek English Edition - - COVER STORY -

If there is one thing that has irked Fin­week over the last two years, it is the creative treat­ment of as­sets to im­press share­hold­ers.

For ex­am­ple, last year Infrasors di­rec­tors val­ued an in­vest­ment prop­erty they held at R98m. With Afrimat as its new con­trol­ling share­holder, the same prop­erty looks like it will be val­ued at about R3m. An­other small-cap play, Ac­cen­tu­ate, cur­rently has a mar­ket cap­i­tal­i­sa­tion of around R83m, but ac­cord­ing to Thebe Stock­broking small-caps an­a­lyst Keith McLach­lan, there is a “re­place­ment value” for its East Lon­don Floor­worx fac­tory of nearly R500m ac­cord­ing to man­age­ment.

We sug­gest erring on the side of cau-

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