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PREMIER GROUP LIMITED
(formerly Premier Group Proprietary Limited)
(Incorporated in the Republic of South Africa)
Registration number 2007/016008/06
JSE share code: PMR
ISIN: ZAE000320321
("Premier", the "Group" or the "Company")
VOLUNTARY TRADING UPDATE FOR THE YEAR ENDING 31 MARCH 2024
Premier representatives will be attending the Bank of America "Global Research 25th
South Africa Conference 2024" on 6 March 2024, where meetings will be held with
numerous investors. Accordingly, the board has elected to provide this voluntary
trading update to the Company's shareholders.
Shareholders are referred to the announcement of the Group's unaudited interim results
for the six months ended 30 September 2023, released on the Stock Exchange News
Service ("SENS"), on 13 November 2023 ("2024 Interim Results Announcement"), in which
it was stated that Premier was well positioned for further growth in the next six-
month period.
The 2024 Interim Results Announcement highlighted that, for the six months to 30
September 2023:
- Revenue increased by 7.1% to R9.4 billion
- Earnings before finance income and finance costs (including foreign exchange
gains), tax, depreciation and amortisation ("EBITDA") increased by 23.9% to R1.0
billion
- The Group's EBITDA margin improved by 150 basis points to 10.9%
- Earnings per share ("EPS") increased by 0.3% to 326 cents per share
- Headline earnings per share ("HEPS") increased by 0.8% to 331 cents per share
- Normalised HEPS(1) increased by 25.4% to 331 cents per share
- Return on Invested Capital ("ROIC") was 20.7%
(1) Normalised HEPS in the prior year ended 31 March 2023 was reduced for foreign exchange gains
on cash and loans of a funding nature and by the reversal of accrued withholding tax on
preference dividends, both of which were once-off in nature. In the current year ending 31 March
2024 (or "the current period"), Premier does not envisage any adjustments to HEPS and
accordingly, Normalised HEPS for the current period is expected to equate to HEPS.
Premier is pleased to note that, for the financial year to date, the business has
performed in line with its expectations for the second half of the year and the
outlook expressed in the 2024 Interim Results announcement.
Based on trading for the financial year to date, while revenue growth has moderated
to low single digit growth, Premier has focused on maintaining margins, which are
expected to remain in line with those achieved for the first half of the current
period. The reduction in the revenue growth rate is mainly due to stability in the
soft commodity prices that are inputs into the Company's MillBake products when
compared to the prior year.
Premier remains focused on organic investment opportunities and its capital
expenditure is expected to be marginally higher than the guidance issued in the 2024
Interim Results Announcement of R600 million for the year ending 31 March 2024. The
major project being undertaken is the rebuilding of the Company's Aeroton Bakery
which is a multi-year project, and which is on track. Other significant projects that
are underway include the Mthatha bakery rebuild and the creation of two centres of
excellence for the sugar confectionary business, which involves the relocation and
upgrade of certain manufacturing lines.
Premier has continued to generate cash from operations and, as a result, has focused
on de-gearing by settling, in full, the revolving credit facility of R1 billion that
was drawn down in November 2022. This will increase Premier's financial flexibility
for future investment opportunities. At this stage, Premier is on track to improve
its leverage ratio at year end (which was 1.4x as at 30 September 2023 and, subject
to final Board approval, pay a maiden, final dividend for the year ending 31 March
2024.
Any forecast or estimated financial information on which this trading update is based
has not been reviewed or reported on by the Company's external auditors.
Premier's results for the year ending 31 March 2024 are expected to be released on
SENS on, or about, 11 June 2024.
Johannesburg
5 March 2024
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 05-03-2024 01:56:00
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