Today's edition
Arms Length
Good morning. Europe’s defence spending boom is opening up a massive new market for South Africa, while local gold and platinum miners are flying high again - thanks to a single decision in Washington.
It's a good day for South African companies, despite little of it happening in South Africa. Let's get into it.
MARKETS
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Paramount is selling armoured vehicles into Europe by handing over the factory
South African military spending has collapsed, which ought to be bad news for a company that has been building armoured vehicles in Midrand since 1994. Paramount Group told journalists at a test track outside Pretoria that its market is growing instead, and that the growth is inside Europe, in countries that were not buying from it two years ago.
The model explains the customer. Paramount rarely ships a finished vehicle: it sells the design and the right to build it, so the production line goes up in the buyer's own country. Deon Grobler, who runs Paramount Land Systems in South Africa, says European governments have lost confidence in the United States as a supplier, and the rift between them has opened markets that were previously shut to a South African manufacturer.
Where the vehicles actually get made:
- India: Bharat Forge builds Paramount's Mbombe 4 as the Kalyani M4 for the Indian Army.
- Czech Republic and Kazakhstan: the same design sells as the M4 Golem and the Barys 8.
- Midrand: the drawings, the intellectual property and about half of each vehicle (armoured glass included).
None of it comes with a number. Paramount is privately held, named no NATO customer and put a value on nothing. Either way, they have confirmed that the next vehicle, built with India's Kalyani, will be unveiled in Pretoria in mid-September.
AUGUST COMPANY
South Africa's gold and platinum miners just had their best month in 20 years
South Africa's gold and platinum miners gained about 38% in August on the JSE's precious-metals return index, the biggest monthly move in data going back to 2006. Last year that index rose more than 200% as gold hit record after record, and the assumption going into 2026 was that the giving-back had started. Instead, after seven months down about 20%, one month has put the year in front.
The move started with the metal rather than the mines. Gold rose nearly 15% over the month after the US Treasury stepped into the bond market unexpectedly, which sent investors back to bullion as cover against government deficits and a weaker dollar.
A mine's costs barely move when the gold price does, so most of a higher price arrives as profit, and the lower those costs to begin with, the bigger that share is. African producers sit at the cheap end, which is why it landed hardest here. AngloGold Ashanti, Pan African Resources and Gold Fields each climbed more than 40%.
Eight of the ten best-performing South African shares in August were precious-metals miners, and they carried the whole market up 4.6% with them.
BAGEL BITE
What is a group of lions called?
A. Pride
B. Pack
C. Herd
DOING THE ROUNDS
Labat Africa declared the first dividend in its history and has been suspended for not paying it. The company put 1c a share on the table on 23 June, called it a landmark achievement, and certified that it would still be solvent the day after the money left. Payment was due on 3 August. A day before the record date the board postponed it until audited annual financial statements appear, no new date has been named, and those statements have not appeared. The last price anyone paid for a Labat share is 3 cents. Full story →
Koeberg is generating no electricity at all. Unit 1 tripped just before 1am on Thursday, and Eskom said nuclear safety was never compromised and the grid remains stable. What its statement does not mention is Unit 2, out since 26 April for refuelling and not due back until November. Africa's only nuclear station normally carries about 5% of the country's power, and more than 1.8 gigawatts of it is off. Full story →
Beef got dearer and shoppers moved to chicken. Foot-and-mouth disease pushed some red meat prices up more than 30% last year, and feed got cheaper at the same time. Rainbow Chicken's revenue rose 7.7% to R17.1 billion and its operating cash earnings doubled to R2.136 billion. The board added a 75c special dividend to the usual 45c final, taking the year to 135c a share. Full story →
Harmony Gold received about a third more for every kilogram of gold it sold this year. Revenue rose 34% to R99.2 billion, and the board declared a record 750c final dividend, about R8.1 billion for the year. The growth money is not going back into South African gold. Finance director Boipelo Lekubo said Harmony sees more value in copper, and executives told the market not to assume another record payout. Full story →
WEATHER
BAGEL GAMES
Have you got what it takes to win today’s Wordle? Play here →
THE ANSWER
As for the Bagel Bite, the answer is: A. Pride
Lions are the only truly social big cats, living together in prides rather than alone. A typical pride is built around a group of related lionesses who do most of the hunting and raise their cubs together. The males defend the pride's territory from rivals. Wolves live in packs and cattle move in herds, but lions have their own special name.
That's your Monday sorted. Enjoyed it? Forward it on, a friend can subscribe in a click. Written by the Business Bagel crew.
