LEWIS GROUP LIMITED - Trading Update And Trading Statement For The Six Months Ended September 2017

Trading Update And Trading Statement For The Six Months Ended September 2017

Lewis Group Limited
Registration Number: 2004/009817/06
Share Code: LEW
ISIN Code: ZAE 000058236

("Lewis" or "the Company" or "the Group")


TRADING UPDATE AND TRADING STATEMENT FOR THE SIX MONTHS ENDED SEPTEMBER 2017

TRADING UPDATE

The performance for the six months ended 30 September 2017 (“the period”) reflects the
challenging economic and consumer environment in which the business is trading and the impact
of these conditions on the Group’s lower to middle income target customers.

Trading conditions have been compounded by the ongoing impact of the National Credit Act’s
affordability assessment regulations which are restricting access to credit in South Africa and
limiting the Group’s credit sales.

Merchandise sales reflected a steady improvement over the period increasing by 5% on last
year, with comparable stores sales up 7.3%. Revenue declined by 3.2% mainly as a result of the
9.8% decline in Other Revenue over the corresponding prior period. This decline is largely the
result of lower credit sales in prior periods which negatively affects the annuity income streams.

The Group’s gross profit margin strengthened by 40 basis points to 40.9% and is in line with
management expectation.

Debtor costs benefitted from improved collections and reduced by 11.5%. This reflects an
improvement from the 6% increase reported at the 2017 year end.

TRADING STATEMENT

Shareholders are advised that as a result of the adverse trading conditions outlined above the
Group anticipates earnings for the period to be as follows:

                               Six months ended                 Six months ended
                                   30-Sep-16                        30-Sep-17
                                   Reported                      Expected range
Earnings per share                 196.6 cps        161.2 cps – 173.0 cps   12% to 18% lower

Headline earnings per share        194.8 cps        159.7 cps – 171.4 cps   12% to 18% lower

The financial information contained in this announcement has not been audited, reviewed or
reported on by the Group’s external auditors. The Group’s interim results for the period are
scheduled to be released on SENS on or about 13 November 2017.
Cape Town
27 October 2017


Sponsor:UBS South Africa (Pty) Ltd
Debt Sponsor: Absa Bank Limited (acting through its Corporate and
Investment Bank division)

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