Economy shrinks but passes Fitch scrutiny

SOUTH Africa was spared a credit-rating downgrade for the second time this month when Fitch retained a stable outlook on its BBB- longterm foreign currency rating, the lowest investment-grade level. S&P affirmed its BBB- level with a negative outlook on June 3.

LANDLINE provider Telkom said it had completed its costcutting strategy after reporting a 15.5% jump in annual earnings, with revenue buoyed by its data division. Headline earnings per share rose to 657.9c, it said.

ASPEN Pharmacare said it would buy an anaesthetics portfolio from AstraZeneca plc of the UK for at least $520million (R7.72-billion), the first acquisition by Africa’s largest generic-drugs manufacturer since securing new funding.

TRANSNET Freight Rail moved a record number of manganese shipments in May due to new trains and improved market conditions, the company said. It moved 1.053 million tons from a previous high of 976 671 tons in October 2015.

SOUTH Africa’s economy contracted by 1.2% in the first quarter after rising by a revised 0.4% in the three months to December, Stats SA said. GDP also shrank by 0.2% on an unadjusted year-on-year basis, compared with 0.6% growth in the previous three months.

NET gold and foreignexchange reserves fell to $40.48-billion (about R601-billion) in May from $41.15-billion in April, data from the Reserve Bank showed. Gross reserves fell to $46.08-billion from $46.95-billion previously, the bank said.

BUSINESS confidence fell to a new all-time low in May, hurt by poor performances in sectors such as manufacturing and retail. The SA Chamber of Commerce and Industry’s business confidence index fell to 79.3 from 82.5 in April. SASOL said it expected full-year profit to drop by as much as 30% following a collapse in energy prices that forced it to write down assets. Headline profit would fall by 10% to 30% from R49.76 a share a year earlier, it said.