GRAND PARADE INVESTMENTS LIMITED - Trading Statement And Voluntary Trading Update

Trading Statement And Voluntary Trading Update

GRAND PARADE INVESTMENTS LIMITED
 (Incorporated in the Republic of South Africa)
(Registration number: 1997/003548/06)
Share code: GPL
ISIN: ZAE000119814
(“GPI” or “the Company”)


TRADING STATEMENT AND VOLUNTARY TRADING UPDATE

Trading Statement

In terms of the JSE Limited Listings Requirements, a listed company is required to publish a
trading statement as soon as it becomes reasonably certain that the financial results for the
next period to be reported on will differ by 20% or more from the financial results for the
previous corresponding period.

GPI hereby advises that a reasonable degree of certainty exists that for the six months ended
31 December 2019 earnings will be as follows:


                                  31 December 2018    31 December 2019     31 December 2019
                                        actual         expected range      expected % change
                                       (cents)              (cents)
Basic earnings per share                (8.23)           0.57 to 2.21       106.9% to 126.9%
Continuing operations*                   8.39            1.89 to 3.57      (77.5%) to (57.5%)
Discontinued operations**              (16.62)         (3.00) to 0.32        81.9% to 101.9%
Headline earnings per share              3.75            9.98 to 10.73      166.0% to 186.0%
Continuing operations                    8.53           10.84 to 12.54       27.0% to 47.0%
Discontinued operations**               (4.78)         (1.82) to (0.86)      62.0% to 82.0%


Notes
 *  Basic earnings per share from continuing operations for the six months ended 31 December
    2019 includes a R38.6m impairment of Goodwill related to Mac Brothers.
 ** Discontinued operations include earnings from discontinued businesses namely, Dunkin
    Donuts, Baskin Robbins and Grand Foods Bakery.

Trading Update

The Company is pleased with the growth in headline earnings per share. The improvement
was driven by decisive actions to exit loss-making businesses and improve operational
performance in the continuing operations. The Company grew revenue for the 6 months period
ended 31 December 2019 by 19% when compared to the same period last year, while it was
able to contain operating cost growth to 3%. Burger King grew sales by 27% with comparative
restaurant sales increasing by 7.8% over the period, while Grand Foods Meat Plant grew sales
by 17% over the period. The increase in headline earnings per share from continuing
operations can be attributed primarily to this improved performance by Burger King and Grand
Foods Meat Plant. This was offset by weaker performance in Mac Brothers on the back of
lower demand for catering equipment in the South African market. The Goodwill related to the
prior acquisition of Mac Brothers was impaired by R38.6m in the current period, leading to a
decline in basic earnings per share from continuing operations.

The board and management remain excited by the prospects for the Company. Near-term
strategic priorities include the conclusion of the previously announced sales of Sun Slots and
Burger King, the settlement of the Company’s debt and resumption of dividends to
shareholders.

The financial information on which this trading statement and trading update is based has not
been reviewed and reported on by GPI’s external auditors. The financial results for the period
ended 31 December 2019 will be published on or about 20 March 2020.

Cape Town
11 March 2020

Sponsor
PSG Capital

Date: 11-03-2020 03:00:00
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