Our opinion on the current state of NAMPAK(NPK)
Nampak (NPK) is Africa's largest packaging company, operating in South Africa and ten other African countries. About 60% of its turnover comes from South Africa, but only 36% of its trading profit. The rest of Africa accounts for 59% of trading profit and only 31% of turnover. The company also has small interests in the UK and Ireland.
Nampak produces four kinds of packaging products—plastics, metals, paper, and glass. The majority of its trading profits come from metals, primarily beverage cans. The company has successfully repatriated R3,5bn (US265m) of surplus cash from Zimbabwe, Nigeria, and Angola, demonstrating strong management in navigating African markets. However, it has halted its African expansion strategy after writing down its businesses in Angola and Nigeria by R3bn.
The company was affected by COVID-19 and the decline in the oil price, impacting its operations in Nigeria and South Africa. However, it avoided selling assets or conducting a rights issue to pay down debt of nearly R6bn. The announcement of a R1,35bn rights issue to reduce debt caused a 30% drop in the share price. This was later reduced from R2bn to R1,5bn, and shareholders approved raising up to R1bn on 30th June 2023.
On 20th April 2023, CEO Eric Smuts resigned with immediate effect and was replaced by Phil Roux. On 16th May 2024, the company announced the sale of its entire Nigerian operation for $68,5m.
In its results for the year to 30th September 2024, the company reported revenue from continuing operations up 1% and headline earnings per share (HEPS) of 3361,1c, compared with a loss of 39004,6c in the previous period. The company said, "The Beverage category continues to grow, in particular beverage in cans, a format which is growing in terms of consumer preference. Challenges faced in the second half relating to the installation of the new 500ml production line at Springs meant that Nampak was unable to fully capitalise on this increased demand."
On 31st January 2025, the company announced the sale of Bevcan Nigeria for $68,2m. The share remains in an upward trend but is a volatile commodity share, and the trend may be coming to an end.
Nampak produces four kinds of packaging products—plastics, metals, paper, and glass. The majority of its trading profits come from metals, primarily beverage cans. The company has successfully repatriated R3,5bn (US265m) of surplus cash from Zimbabwe, Nigeria, and Angola, demonstrating strong management in navigating African markets. However, it has halted its African expansion strategy after writing down its businesses in Angola and Nigeria by R3bn.
The company was affected by COVID-19 and the decline in the oil price, impacting its operations in Nigeria and South Africa. However, it avoided selling assets or conducting a rights issue to pay down debt of nearly R6bn. The announcement of a R1,35bn rights issue to reduce debt caused a 30% drop in the share price. This was later reduced from R2bn to R1,5bn, and shareholders approved raising up to R1bn on 30th June 2023.
On 20th April 2023, CEO Eric Smuts resigned with immediate effect and was replaced by Phil Roux. On 16th May 2024, the company announced the sale of its entire Nigerian operation for $68,5m.
In its results for the year to 30th September 2024, the company reported revenue from continuing operations up 1% and headline earnings per share (HEPS) of 3361,1c, compared with a loss of 39004,6c in the previous period. The company said, "The Beverage category continues to grow, in particular beverage in cans, a format which is growing in terms of consumer preference. Challenges faced in the second half relating to the installation of the new 500ml production line at Springs meant that Nampak was unable to fully capitalise on this increased demand."
On 31st January 2025, the company announced the sale of Bevcan Nigeria for $68,2m. The share remains in an upward trend but is a volatile commodity share, and the trend may be coming to an end.
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Feragatname
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