Category Archives: Santova (SNV)

Santova Ltd – FY 26 Results Note – Seabourne Acquisition Delivering

Share Code: SNV – Market Cap: R991m – PE: 7.3x – DY: 0.0%

Santova – Results Note – FY 26Download

Summary of Results: Delivering through a tough period

  • During FY 26, Santova acquired Seabourne (consolidated for 9m in this period) for R400m, including a cumulative profit warranty over two years.
  • Overall, the Group performed slightly better than our forecast with FY 26 revenue growing +88% y/y, and HEPS slightly down at 107cps (FY 25: 115cps); importantly, Seabourne exceeded our expectations.
  • Group margins have declined, but this is due to Seabourne’s consolidation.
  • Group balance sheet remains comfortably net cash, even after we deduct interest-bearing borrowings and Seabourne’s profit warranty debt.

Thoughts: Geographic Diversification building resilience

  • Given Seabourne’s early signs of success, we believe that management’s acquisitive track record remains intact. Likewise, given Seabourne’s relative size to the Group (more than two times the cumulative business acquisitions of the prior ten years), the importance of this acquisitive success cannot be emphasised enough.
  • Geographical profit mix remains ever volatile, but—whilst hard to model—we do consider this as one of the strengths of the business model: diversification. The “portfolio effect” of this diversification has seen overall (long-term) profits steadily growing which we expect to continue.

Updated Forecast and Valuation: Remains below fair value

  • We expect revenue in FY 27E to be more than double FY 25 revenue (largely driven by Seabourne’s full consolidation during the year), with profit growing to R169m from R148m in FY 25 (+23% y/y versus FY 26).
  • FY 26’s ROE has declined in line with Seabourne entering the balance sheet (but not being fully consolidated), & lower profit margins but (through the cycle it) is still beating Cost of Equity comfortably; FY 26 ROE was 11%, which we expect to steadily start rising from FY 27E.
  • Our DCF arrives at an implied fair value of R10.32 per share (previously: R9.72), which compares attractively against the current share price of R7.70, and would place the share on a Price Earnings of 9.6x and Price-to-Book of fractionally over 1.0x. This implies a 12m TP of R11.48 (previously: R10.32).
Santova – Results Note – FY 26Download

Santova Limited – Initiation of Coverage – Great Track Record & Exciting Future

Share Code: JSE: SNV – Market Cap: R900m – PE: 6.7x – DY: 2.5%

Santova – Initiation of Coverage – 23 February 2026Download

Business Overview: Global Track Record

  • Listed on the JSE, Santova is a global technology-based trade solutions specialist providing innovative international end-to-end supply chain solutions. The Group operates primarily as a Fourth-Party Logistics (“4PL”) provider from 33 offices in 13 countries (& growing), whereby the Group manages the (increasingly) complex logistical needs of clients globally.
  • The Group has grown organically and through 13 business acquisitions, with the quality of their acquisitive execution evidenced by the fact that only two of these acquisitions resulted in quite minor goodwill impairments.
  • Related to this point and, more recently, in May 2025, the Group acquired Seabourne (England, France, Scotland and Netherlands), which should see the Group double revenue in FY 27E (the first year of full consolidation).

Key Upsides & Downsides: A Longer-term View Smooths the Volatility

  • In the short-term, Santova’s regional revenues and profits can be volatile from period to period (via volumes, freight rates and/or foreign exchange). However—when we look beyond short-term volatility—Santova has a strong track record of increasing earnings over the long term. Thus, we believe that the Group’s performance is best evaluated over five- or ten-year periods, smoothing potentially misleading short-term volatility.
  • A shareholder would have achieved a c.10% p.a. CAGR Total Return (TR) over the decade to FY 25. However, we believe the share price is currently undervalued, which deflates TR. Furthermore, we believe that the current share price does not reflect the potential of Seabourne, and there is substantial upside from the current price (10-year TR < Next 10-year TR).
  • Seabourne’s delivery on its profit warranty and exchange rates are likely to be the largest determinants of profits in the short- to medium-term.

Forecast, Valuation and Implied Return: Share Undervalued

  • Our Group forecast is built from forecasting Santova and Seabourne, respectively, using historic margins, and assuming a conservative 3% real growth rate along with some other simplifying assumptions (flat FX).
  • Using a DCF, we arrive at an implied fair value of R9.70, implying c.28% upside to the share price of R6.95. When considering global peers’ valuations and M&A multiples of the past two years, we believe there to be >60% potential upside which could crystallise in a range of ways over time.
Santova – Initiation of Coverage – 23 February 2026Download