Share Code: ARA – Market Cap: R504m – Discount to NAV: 34%

Q3:23 Results: Softer Quarter

• In Q3:23, Astoria reported a flat ZAR-NAV of 1408cps (FY 22: 1406cps), though a weaker ZAR (11% weaker against the USD from FY 22 close to Q3:23 reporting date) pushed the USD-valuation slightly lower to $0.74 per share (FY 22: $0.83ps).
• Astoria typically only fairly values its unlisted investments with its Q2 (i.e. H1) & Q4 (i.e. Full-year) results &, thus, this result involves only updated share prices & exchange rates.

Commentary: Loadshedding Impacted Goldrush

• RECM & Calibre Preferences Shares’ (code: RACP) lower share price shaved c.39cps from Astoria’s SOTPs, & this appears driven by pressure at Goldrush from loadshedding (i.e. lost trading hours, higher costs from generators & consumer pressure). It is encouraging to see that Goldrush’s average revenue per (active) machine grew +5% y/y & that the Sports Betting & Online Gaming divisions grew strongly (+18% & +51% respectively). Cash flow was strong at Goldrush & we expect its operations to stabilize as it solves for power & optimises for the environment, thus we remain optimistic on RACP’s prospects.
• As noted above, the other significant drag on Astoria’s USD-NAV has been the 11% weaker ZAR/USD exchange rate.

Valuation, 12m TP & Implied Return: (Still) Under Cautionary…

• Updating Astoria’s NAV to current prices, the share price is trading at a c.34% discount to current NAV (Previously: 24%).
• If we take out our calculated “HoldCo discount” of c.15.0% (Previously: 14.5%) from this NAV, we arrive at a fair value for Astoria’s shares of c.1152cps (Previously: 1213cps) or c.22% higher than the current share price.
• Rolling this fair value forward at our Cost of Equity, we arrive at a 12m TP of c.1365cps (Previously: 1440cps) that implies a potential return of c.52% from the current share price.

Note: The share is (still) trading under a cautionary announcement due to a potential acquisition.