Our opinion on the current state of REX-TRUE(RTO)Rex Trueform (RTO) is an extremely thinly traded company on the JSE, which makes it impractical for private investors in its current form. Established in 1937 and listed on the JSE since 1945, RTO manufactures and markets clothing and accessories through its Queenspark and J. Crew stores, operating across South Africa. The company also owns a portfolio of properties in the Cape Town area. RTO is controlled by a consortium led by Marcel Golding and Hugh Roberts.
In its effort to diversify, the group recently invested R81 million to acquire a 33.8% stake in Sembcorp Siza, a water reticulation and specialist pipe services company operating in KwaZulu-Natal. The company maintains a strong balance sheet and has been exploring opportunities for further diversification.
For the year ending 30th June 2024, RTO reported a 1% decline in revenue and a significant drop in headline earnings per share (HEPS), down 90.6%. The company's net asset value (NAV) also decreased by 1% to 1929c per share. Despite its strong financial position, the extremely low trading volumes of both its ordinary and "N" shares make it difficult for investors to take an interest in the stock. Given the lack of liquidity, RTO is not a practical option for most private investors at this time.
