Investors rushed to buy Discovery shares on Thursday, relieved that no imminent rights issue would dilute their stock and encouraged by the group’s emerging businesses, which finally looked near profitable. Shares in Discovery rose as much as 7.92% to R127.99, despite the group missing earnings forecasts. The share price closed 4.35% higher at R124.70. The share-price jump was partly a "relief rally", with shareholders pleased that no rights issue was announced to raise capital for new business funding, said analysts. Delivering the group’s results for the six months to December 2016, CEO Adrian Gore said the group had more than R1bn to fund new business growth. Spend on new initiatives fell 36% to R244m, accounting for 7% of operating profit, which rose 13% to R3.4bn. The share was further buoyed by news that operating losses in emerging businesses — Ping An Health, Discovery Insure and the Vitality Group — were substantially lower. "We hope these businesses will be profitable in t...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.