Tiger trumps volumes
February 22, 2010 in Uncategorized
Jozi, Jozi. A bad day at face value, but we ended at the highs of the day. Which just happened to still be down by 211 points down on the Jozi all share to 27069, construction stocks still taking a lot of tap, that sector down by three and a half percent. The reason why the markets improved were the better than anticipated US CPI numbers out in the afternoon, pre market their side.
And then a lame article from Friday. Really. MTN Group to leave SA? Huh? What nonsense is that? Is that some people just bored and nothing to do Friday? Read the story and let me know what YOU think. This whole story of MTN maturity and their South African exposure is starting to make me mad.
Here is a company that had 3.5 million subscribers in 2001. 23 million in 2005. 90 million at the end of 2008 and at the September 2009 period, 108 million subscribers. There you go. Got that? South Africa, 17.2 million subscribers here at the end of the half year to June 2009. As per their half year reporting presentation: “The disappointing increase in subscribers was due to a combination of factors including challenges on the network and supporting systems, slowing GDP growth, pressure on consumer spend, and competitor activity in the first half of the year.”
Postpaid subscribers increased 4 percent to just 2.9 million. Out of 17.2 million. To call this a mature market misses the point entirely, because you most probably believe that voice is the be all and end all. It is all about digital convergence. Ten years ago you sent an sms. Now you browse on your phone. The very high brow waiter serving me this weekend, a football junkie, when I asked him a score checked his phone for a score. That is right, he dialled up in front of me and told me. He is smart, he just waits tables as a result of the genius job creation that Bob to the north put in place. Not.
OK, the point I am trying to make is two-fold, one, the South African market is nowhere near mature, turning pre paid into full post paid customers on data bundles is a challenge that seems years away. Secondly, this notion that South Africa is not important to MTN is misunderstood, it has become less important from a subscriber and profits point of view, but the base and higher ARPU’s means that there are more valuable subscribers. The average ZA customer has an ARPU of 15 US dollars, the average Iranian subscriber is 8 US Dollars per month. You tell me which one you would rather have right now. More on this, we are building to something.
Oh, and whilst you are at it, check out how MTN have rolled out their MTN Mobile money product in Rwanda. Money transfer via mobile phones is huge in East Africa. Some of the best and most advanced systems in the world, it works really well there. Check out this article from the East African publication, Business Week, MTN Mobile Money goes live in Rwanda
And then this other one. SA being the worlds biggest welfare state. OK, President Jacob Zuma made a point in his rebuttal to the reaction from the opposition, a point well worth repeating: “Around one-third of all South Africans are under the age of 15. Half of all South Africans are under the age of 25. And nearly 70% of all South Africans are under the age of 35, according to Stats SA.” released in July last year there are over 20 million people under 19 in this country, 25 million under 25 and around 29 million under 30. And born frees, under 15, 15.3 million people. Phew. so around one third of all South Africans only have their parents connection to the past ills of this country. If anything a point to be made, that child grants are not forever, the more important debate is how to get jobs lined up for these people.
So all those folks receiving child grants are by far and away higher than the other grants, by numbers, not so? These people will grow up. It is not like these people stay young forever, so the folks getting the grants up to the age of 17 and 364 days do turn 18. The child care grant recipients are 9.4 of the 13.9 recipients.
Point, those people are not going to be under 18 forever. According to the last population survey,
Niger. What, who cares? Well, we should care, because folks still think Africa is one country. Oh, that Africa place where you go on Safari. Yes, there are folks who still tar all Africans with exactly the same brush. Greek debt problems are Greek you see, but Niger’s problems need our attention. Perhaps that is just nonsense, but you know what I mean.
Niger is in the middle of nowhere. Above Nigeria, below Algeria, that is all you need to know about the climate, hot in the North, and hot in the South with a little more rain. The country is poor, in fact so poor that the annual GDP per capita contribution is under 800 US Dollars. Nothing.
And that is the other thing that grates me when I see an African story, why do I have to go to the New York Times to find the “best” story? Don’t we care about military coups on the continent? Well, here goes, from the New York Times: Opposition in Niger Urges Junta to Hold Vote
So what is it all about? Uranium. Over two thirds of all Niger export proceeds are made up of Uranium. Areva have two major mines in Niger. Niger provides 40 percent of France’s energy needs. France has 59 nuclear power stations that provide 78 percent of their PRODUCTION. Not their consumption, that only is enough for 16 percent. But, nevertheless, you can see why this is important for some, that peace be restored.
But this was the funny part, Bloomberg London crossed to Johannesburg to speak about what was happening in Niger. From London to the Niger capital Niamey is 4225 kilometres. From Johannesburg to Niamey is 5229 kilometres. Next time you need to know something about Niger, go and ask a Frenchman, one that is interested in supplying Nuclear Power Stations.
New York, New York. At face value a nothing day. In reality markets breathing easy, mostly due to a much lower than expected CPI read, which then throws inflation expectations out of the window. For now. We wait. And the headlines that emerge about less worrying about Greece. Ah yes. And I saw this morning that the Greeks said that they are fine until the end of March. Also good. What, March is just around the corner?
Hah-hah, during the great weak Tiger Woods conference volumes plunged as even traders took time out to have a look at what he had to say. Really. I did not watch it live or the whole thing, but it looked lame. Session end the Dow closed at 10402, up 9 points. The nerds of NASDAQ 2 better to 2243 whilst the broader market S&P 500 up by 2.4 to 1109.
Oil, the NYMEX price last crossed the wires (or as the sentence was written) at 80.29 Dollars per barrel. The gold price is higher at 1125 Dollars per fine ounce, the platinum price has also moved lower to 1539 Dollars per fine ounce. The copper price is also lower at 333 US cents per pound. The Rand is firmer at 7.64 to the US Dollar, 10.42 to the Euro and 11.84 to the Pound Sterling.
OK, expect a big positive steer here as the trading year of the Tiger kicks off out to the East and out West Tiger is in another space.