Resilient results to be issued early
• Company to release results early amid speculation on short sellers
An apparently spooked Resilient has announced it is bringing forward the release of its interim results by two weeks. Last Friday, the company, which has been battling to counter speculation of a pending attack by short sellers, said it would release its interim results this coming Friday.
An apparently spooked Resilient has announced it is bringing forward the release of its interim results by two weeks.
Last Friday, the company, which has been battling to counter speculation of a pending attack by short sellers, said it would release its interim results this Friday.
The results were due to be released on February 8. The company gave no explanation for the earlier release date, but on Sunday, CEO Des de Beer said the group was aware of some concern in the market.
“There’s a hedge fund with a campaign to panic the market; we don’t like to deal with innuendo and fiction but decided to release the results early in a bid to protect investors,” he said.
The news was met by comment on Twitter, which was subsequently removed, that the early release had been prompted by the company’s desire to shorten the closed period so companies in the Resilient stable could resume trading in the share as soon as possible.
The share price closed 1.6% weaker on the day, at R123.74.
De Beer, who was not aware of the Tweet, challenged the claim about the closed period and said the group had no policy of supporting the share price.
Resilient and related companies Greenbay, NEPI Rockcastle and Fortress, have suffered a change in market sentiment since the beginning of 2018.
Having reached a record high of R151.16 as recently as December 29, following its inclusion in the JSE Top 40 index, the 28% slump in the share price in the first days of 2018 trading shocked many supporters. One long-term supporter said De Beer had made his investors extremely wealthy over the years as Resilient and the related shares reached ever higher levels.
“But for a long time there are two schools of thought: one that believes he’s a remarkably canny investor and superb deal maker; the other reckons in recent years the share price strength has relied on the four companies buying shares in each other and pushing the prices to levels not justified by the underlying net asset value.”
The purchases are part of the stated investment strategies of the companies and until now did not cause much concern.
The jitters are attributed to the rise in US long-bond rates, which knocks the relative attractiveness of the group’s property investments, and general market nervousness in the wake of the Steinhoff scandal.
“It’s likely that there are some investors who have shorted the shares and are keen to keep pressure on the companies,” said a trader at the weekend.
He said market sentiment and the outlook for US interest rates played into their hands. “The shares’ hefty premium on net asset value was easily justified in the past on the grounds of the growth strategy and De Beers’s excellent deal-making skills. When the sector is consolidating, premiums are justified,” said the trader.