Our opinion on the current state of AF-&-OVER(AOO)Rex Trueform's holding company, which is also listed on the JSE, faces the same challenges as Rex Trueform (RTO) itself, with both being extremely thinly traded. This lack of liquidity makes the shares impractical for private investors at present. Established in 1937 and listed on the JSE since 1945, Rex Trueform manufactures and markets clothing and accessories through its Queenspark and J. Crew stores, which are spread across South Africa. Additionally, the company owns a portfolio of properties in the Cape Town area.
The group is controlled by a consortium led by Marcel Golding and his partner Hugh Roberts. Recently, the company diversified by investing R81 million to acquire a 33.8% stake in Sembcorp Siza, a water reticulation and specialist pipe services company operating in Natal. Despite having a strong balance sheet and a clear strategy to diversify, the company's thin trading volume continues to hinder broader investor interest.
In its financial results for the year ending 30th June 2024, Rex Trueform reported a 1% decline in revenue and an 85.4% drop in headline earnings per share (HEPS). The company's net asset value (NAV) fell slightly by 0.5% to 1878c per share. Despite its solid financial position, the thin trading of both its ordinary and "N" shares remains a significant barrier to attracting investor interest, making it difficult for private investors to engage with the stock.
