Update 28 August
BRICS Summit Highlights and Corporate Performance Trends
The 15th BRICS summit was held in Johannesburg, South Africa, from 22 to August 24, 2023. The summit was presided over by South African President Cyril Ramaphosa, who currently holds the chairmanship of BRICS. The summit’s theme was “BRICS and Africa: Partnership for Mutually Beneficial Development.”
One of the summit’s key outcomes was the decision to expand BRICS. The leaders agreed to invite Argentina, Egypt, Indonesia, Iran, Kazakhstan, and Saudi Arabia to join the bloc as “observers.” This is a significant development, as it could pave the way for BRICS to become a more inclusive and representative organization. Another update from the summit is that the leaders agreed to establish a BRICS currency reserve pool. This pool would be used to provide financial support to BRICS countries during times of economic crisis. The leaders also agreed to work together to develop a new international financial architecture more responsive to developing countries’ needs.
The leaders also discussed the need to strengthen BRICS cooperation in science and technology, innovation, and education. They agreed to work together to promote sustainable development and address climate change. They also reaffirmed their commitment to multilateralism and the rules-based international order.
Sasol Ltd. (JSE: SOL)
The group encountered several obstacles in their latest results that impacted their profitability. Factors such as dwindling sales volumes, a dip in Brent crude oil prices, and elevated operational costs all contributed to a decline in their bottom line. Furthermore, the increased expenditures related to external coal and fuel acquisitions added to their financial strain. The group’s performance was also hampered by constraints within their South African operations, stemming from issues such as power availability, railway functionality, and broader infrastructure performance.
Despite the hurdles, the group’s financial dynamics exhibited a mix of trends. While their total debt experienced an upward trajectory, increasing from R105.1 billion to R125.6 billion, a silver lining emerged in the form of augmented cash generated through operating activities. This crucial metric demonstrated a noteworthy growth of 15%, culminating in R64.6 billion. Another standout achievement was the advancement made through the Sasol 2.0 transformation program. This initiative, aimed at revitalizing the group’s operations and strategies, bore impressive fruits. The group contributed an EBITDA of R13.5 billion, a significant overachievement compared to the set target of R8.5 billion.
In the realm of earnings, a divergent tale unfolded. Basic earnings per share experienced a sharp decline, plummeting from 62.34 cents in the previous year to a mere 12.00 cents. Yet, this apparent setback was offset by a contrasting surge in headline earnings. Despite the intricate challenges, the group elevated their headline earnings from 47.58 cents in the preceding year to an improved 53.75 cents in the current fiscal year.
NVIDIA Corp (NSDQ: NVDA)
Nvidia unveiled its first-quarter results for the April 30, 2023 period, painting a portrait of remarkable growth and innovation. Among the highlights, the Data Center segment emerged as the principal catalyst behind the company’s surge in performance. Fueled by an escalating demand for extensive language models and generative AI, cloud service providers and major players in the consumer internet sphere played a pivotal role in propelling this unit to new heights. Impressively, the revenue for this sector soared past $10.3 billion, marking a staggering increase of over 170% compared to the previous year. This surge was the direct outcome of key industry players’ swift adoption of Nvidia’s next-generation processors.
Undoubtedly, innovation was the pulse of Nvidia’s first quarter, with many new product releases and partnerships announced.
Of noteworthy significance was the revival witnessed within the gaming division. This achievement carries particular weight considering the segment’s hurdles in preceding quarters, including subdued demand, macroeconomic pressures, and the normalization of supply chains. In an impressive turnaround, the division’s revenue surged past the $13.5 billion mark for the three months concluding in June. The market responded emphatically to Nvidia’s achievements, as the firm’s shares surged by a notable 6.5% after-hours trading in New York. These gains only added to the company’s substantial growth throughout the year, reflecting the widespread recognition of their accomplishments.
Jensen Huang, Nvidia’s visionary chief executive, summed up the momentous period aptly, proclaiming the inception of a “new computing era.” He highlighted the global shift from conventional computing to accelerated computing and generative AI in a poignant statement. This shift underscores Nvidia’s role as a trailblazer, navigating the transformative landscape of technology with unwavering determination and a clear focus on innovation.
Sources: Businesstech, Moneyweb, BBC News
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