Share price 78.5c, NAV (est) 101.9c. Disc 23%. |
After Zimbabwe, this SA change is what I was hoping for. Still at a big discount (est. nav of 99c), and weaker USD isn't helping me. |
Share price 77c, NAV 97c. |
Quarterly report for September:
Zimbabwe is 12.8%. Current events not mentioned, of course. |
Who knows, AOF might get something back (12.5p/sh is the provision):
(12/09/17) |
Have bought back after a good few years(2014sold, I think). Whether Zimbabwe gets on its feet I don't know, but can only hope the populace won't put up with more misery.
The Shoprite dispute is still plodding on, but they seem to have a provision against it in their NAV, and we're at a decent discount to that. |
One for the future. |
I hold mine with TDDirect, can usually be traded online. |
How can I buy this fund? Hargreaves Lansdown don't offer it! |
NAV rises over 3% in one month (Jan) and 5.3% ytd.
That's annualised 31% - which won't happen of course! |
Are Frontier Markets overvalued?
And is the move by AOF to treble its size and move to main market a 'sell' signal? |
Intention to move to main market and 'C' share issue up to $100m:
Current MCap is only $51m. |
 Final results. The first detailed comment from AOF on Shoprite:
The possibility of litigation about AOF's Shoprite shares which we mentioned briefly in last year's annual report is becoming a certainty. Shoprite has conveyed to us its intention to seek to reverse the allegedly unauthorized trades in its shares. In its briefest form, we bought shares on the Lusaka Stock Exchange via open market purchases only to learn later that some of the shares sold were apparently treasury shares of Shoprite. The Company now claims its shares should not have been sold and that we should have known better than to buy them. The argument to us is absurd. Anonymity is a cornerstone of stock market trading and we had no knowledge of the identities of the different sellers of Shoprite shares. Furthermore, it is one thing to know that Shoprite is the seller of shares in Zambia (which we did not); it is another thing, totally unrelated, to deduce from that knowledge that the seller of Shoprite shares is allegedly engaged in unauthorized or fraudulent transactions. We cannot think of any reason why we should have suspected, let alone known, as reasonable stock market traders, that Shoprite was a victim of such transactions. Apparently Shoprite has a claim against its agent; however, based on legal advice obtained from Zambian, South African, and English counsel, we believe any claims against AOF will be successfully defended. To date nothing has been filed at Court by Shoprite though we have been advised by Shoprite that the filing of court papers is imminent. We believe that our title to the Shoprite shares is valid and that we will be able to rebut the arguments that we believe are being advanced by Shoprite. In the meantime, unsurprisingly, Shoprite's conduct has had the effect of discouraging trading of Shoprite shares in Zambia and harming the interests of legitimate shareholders like AOF. We will take all steps in our power to defend any legal action that may possibly be taken by Shoprite against AOF and to recover any losses that may arise as a result of Shoprite's conduct. |
It's just possible that last week's fall has something to do with the Zambia-listed Shoprite shares.
The situation is explained (somewhat!) here:
hxxp://cfo.co.za/profiles/blogs/shoprite-halts-dividends-in-zambia
The FY results are due later this month, and some litigation is pending. It appears that some Lusaka-listed shares are 'missing'.
A positive result is expected by AOF and could lead to an immediate uplift of around 4c in NAV. The worst case (Shoprite holding = zero) would lose about 10c from NAV.
But more likely EM blues. |
David Stevenson is keen on Africa and on AOF:
... my preferred play is a small, but well-regarded Aim-traded outfit called the Africa Opportunities Fund (AOF) managed by Francis Daniels. This trades at a 20 per cent discount to net asset value and invests in both African equities key holdings include the big continent-wide retailer Shoprite and west African mobile phone network Sonatel and government bonds. Unlike many other funds, South Africa is only a small part of the portfolio.
A much bigger chunk 18 per cent, as at the end of 2012 is in Nigeria. If I had to make a choice and pick one equity market that I think could be a dominant player over the next decade, it would have to be this one. |
Last month saw 7.8% increase in NAV. |
'Africa Calling' - is the investment community moving to the next rotation? |
From AFMF's FY results:
Africa Opportunity Fund (6.0% of net asset value)
This London traded closed end fund had a difficult six months by African standards, with the NAV performance held back by exposure to resources companies. The NAV return was 7.1% on a total return basis but the share price return was -3.0% as the discount to NAV widened from 12.9% to 21.2%. The portfolio remains concentrated in deep value situations across Africa, many at the smaller end of the capitalisation spectrum. At the time of writing the ten largest investments (over 70% of NAV) were trading on a trailing average Price to Earnings ratio of 7.5x, a dividend yield of 7.5% and a Return on Equity and Return on Assets of 31.5% and 17.1% respectively. The fund will hold a continuation vote in the first half of 2014 and will likely witness discount narrowing in advance of that event. |
Investing in Africa: |
NAV (see header) up 4.7% over the last month, hence the share price reaction.
Makes up for some underperformance late last year.
A relatively safe entry to Africa has to be Unilever [ULVR]. |
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