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CONSOLIDATED RESULTS FOR THE YEAR ENDED 30 JUNE 1999
ABRIDGED GROUP INCOME STATEMENTS
(RAND 000'S UNLESS OTHERWISE STATED)
UNAUDITED AUDITED
YEAR TO YEAR TO
30 JUNE 30 JUNE %
1999 1998 INCREASE
TURNOVER 342 910 298 494 +14,9
OPERATING PROFIT BEFORE
DEPRECIATION 47 284 34 733 +36,1
DEPRECIATION (4 066) (4 787) -15,1
OPERATING PROFIT 43 218 29 946 +44,3
INTEREST RECEIVED 5 034 4 588 +9,7
PROFIT ON SALE OF FIXED PROPERTY - 122
PROFIT BEFORE TAXATION 48 252 34 656 39,2
TAXATION (15 782) (11 411)
PROFIT AFTER TAXATION 32 470 23 245 +39,7
OUTSIDE SHAREHOLDERS' INTEREST (49) (138)
EARNINGS ATTRIBUTABLE TO ORDINARY
SHAREHOLDERS 32 421 23 107 40,3
NUMBER OF SHARES IN ISSUE (000'S) 18 311 18 311
EARNINGS PER SHARE (CENTS) 177,1 126,2 +40,3
HEADLINE EARNINGS PER SHARE (CENTS) 177,1 125,5 +41,1
DIVIDENDS PER SHARE (CENTS) 35,0 25,0 +40,0
RECONCILIATION OF HEADLINE EARNINGS
EARNINGS ATTRIBUTABLE TO ORDINARY
SHAREHOLDERS 32 421 23 107
PROFIT ON SALE OF FIXED PROPERTY 0 (122)
HEADLINE EARNINGS 32 421 22 985
ABRIDGED GROUP BALANCE SHEETS
(RAND 000'S UNLESS OTHERWISE STATED)
UNAUDITED AUDITED
30 JUNE 30 JUNE
L999 1998
CAPITAL EMPLOYED
ORDINARY SHAREHOLDERS' INTEREST 142 437 115 981
OUTSIDE SHAREHOLDERS' INTEREST 602 333
143 039 116 314
EMPLOYMENT OF CAPITAL
FIXED ASSETS 105 896 65 148
NET CURRENT ASSETS 37 143 51 166
CURRENT ASSETS 88 780 74 076
LIQUID FUNDS 19 502 48 247
CURRENT LIABILITIES
- INTEREST FREE 71 139 71 158
L43 039 116 314
NET ASSET VALUE PER SHARE (CENTS) 781 635
COMMENTARY
GROUP RESULTS FOR THE 1999 FINANCIAL YEAR, ITALTILE'S 30TH YEAR OF TRADING,
WERE HIGHLY COMMENDABLE. TURNOVER ROSE BY 15% TO R343 MILLION, WITH OPERATING
PROFITS RISING 36% TO R47 MILLION. HEADLINE EARNINGS GREW BY 41,4% TO 177,1
CENTS PER SHARE.
CENTRAL TO THE GROUP'S PROFIT GROWTH WERE:
- INCREASED RETURNS FROM THE GROUP'S FRANCHISE DIVISION.
- THE CONTINUED EXPANSION OF THE NUMBER OF OUTLETS. THE GROUP NOW TRADES FROM
62 STORES WITH NINE OPERATIONS HAVING COME ON STREAM THIS YEAR.
- ENHANCED STOCK MANAGEMENT METHODS.
- IMPROVED MARGINS ACROSS A BROAD SPECTRUM OF PRODUCTS.
DURING THE YEAR UNDER REVIEW ITALTILE OPENED IT'S FIRST TWO STORES IN
AUSTRALIA. THIS OPERATION HAS REACHED PROFITABILITY AND FURTHER EXPANSION IS
PLANNED. THE ITALTILE CENTRES HAVE BEEN RE-BRANDED AND THREE "NEW GENERATION"
STORES COMMENCED TRADING, PRODUCING ENHANCED PROFITABILITY. AT LEAST THREE
FURTHER STORES HAVE BEEN PLANNED FOR THE COMING YEAR.
THE GROUP ADDED R37 MILLION TO ITS PROPERTY PORTFOLIO IN SUPPORT OF ITS
EXPANDING CORE BUSINESS. THIS WAS FINANCED THROUGH THE GROUP'S OWN CASH
RESOURCES.
STOCK LEVELS INCREASED FROM R74 MILLION TO R88 MILLION, A DIRECT CONSEQUENCE OF
THE ONGOING GROWTH IN OUTLETS.
THE GROUP REMAINS UNGEARED, WITH THE BALANCE SHEET REFLECTING THE COMPANY'S
STRONG FINANCIAL POSITION.
MANAGEMENT STRUCTURE
DURING THIS REPORTING YEAR MR. JOHN COUZIS TOOK OVER THE EXCLUSIVE
RESPONSIBILITY OF EXPANDING THE GROUP'S INTEREST IN OFFSHORE MARKETS. MR. PETER
SWATTON, FORMERLY THE FINANCIAL DIRECTOR, REPLACED HIM AS CHIEF EXECUTIVE. MR.
SERGIO GALLI, WHO HEADS UP THE ITALTILE CENTRE DIVISION, WAS APPOINTED TO THE
BOARD AS AN ALTERNATE DIRECTOR. MR. GRANT BURROWS, FORMERLY HUMAN RESOURCES
MANAGER, HAS BEEN APPOINTED TO HEAD UP THE CTM DIVISION, WITH MR. BRANDON
POLLEY MOVING FROM OPERATIONS TO MANAGE THE FRANCHISING DIVISION.
YEAR 2000 COMPLIANCE
THE GROUP'S YEAR 2000 PROJECT, INCLUDING TESTING, HAS BEEN COMPLETED AND
SUBJECTED TO INDEPENDENT REVIEW. THE DIRECTORS BELIEVE THAT THE YEAR 2000 ISSUE
WILL NOT HAVE ANY MATERIAL IMPACT ON THE GROUP.
PROSPECTS
THE GROUP IS EXTREMELY SATISFIED WITH THE PLEASING PERFORMANCE ACHIEVED OVER
THIS REPORTING PERIOD.
ALTHOUGH INTEREST RATES HAVE SOFTENED, WE DO NOT EXPECT ANY MATERIAL IMPACT
RESULTING FROM EITHER AN IMPROVED ECONOMIC CLIMATE OR FROM ANY SIGNIFICANT
RECOVERY IN THE BUILDING INDUSTRY IN THE COMING SIX MONTHS.
ITALTILE WILL NEVERTHELESS CONTINUE WITH ITS PLANNED STORE EXPANSION PROGRAMME,
BOTH LOCALLY AND OFFSHORE. WITH THE IMPETUS CREATED BY THE ENLARGED TRADING
PLATFORM, IT IS ANTICIPATED THAT THE COMPANY WILL CONTINUE TO PRODUCE A REAL
GROWTH IN EARNINGS.
DIVIDEND
THE BOARD HAS DECLARED A FINAL DIVIDEND OF 20 CENTS PER SHARE. THIS, TOGETHER
WITH THE INTERIM DIVIDEND OF 15 CENTS PER SHARE, BRINGS THE TOTAL DIVIDEND TO
35 CENTS PER SHARE FOR THE YEAR.
THE GROUP WILL RETAIN ITS DIVIDEND COVER AT APPROXIMATELY 5:1.
FOR AND ON BEHALF OF THE BOARD
G RAVAZZOTTI CHAIRMAN
P SWATTON C.E.O.
17 AUGUST 1999
DIVIDEND ANNOUNCEMENT
NOTICE IS HEREBY GIVEN THAT FINAL DIVIDEND NUMBER 66 OF 20 CENTS PER SHARE HAS
BEEN DECLARED PAYABLE TO ALL SHAREHOLDERS REGISTERED IN THE BOOKS OF ITALTILE
LIMITED AT THE CLOSE OF BUSINESS ON 3 SEPTEMBER 1999 AND WILL BE PAYABLE ON OR
ABOUT 1 OCTOBER 1999.
FOR AND ON BEHALF OF THE BOARD
P SWATTON SECRETARY
17 AUGUST 1999
REGISTERED OFFICE
THE ITALTILE CENTRE BUILDING, CNR BURKE STREET AND HENDRIK VERWOERD DRIVE,
RANDBURG 2194 (PO BOX 1689, RANDBURG 2125)
TRANSFER SECRETARIES
MERCANTILE REGISTRARS LIMITED, 11 DIAGONAL STREET, JOHANNESBURG 2001 (PO BOX
1053, JOHANNESBURG 2000)
DIRECTORS
G A M RAVAZZOTTI (CHAIRMAN), P D SWATTON** (C.E.O.), J COUZIS*, G COUSINS, D H
RABIN, S GALLI (ALT) *GREEK **BRITISH
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