AUGUST 17, 2000
TRUWORTHS LIFTS HEADLINE EARNINGS AS SA SALES IMPROVE
TRUWORTHS INTERNATIONAL LTD TODAY REPORTED A 16,4% INCREASE IN GROUP HEADLINE EARNINGS PER SHARE TO 32,8C (28,2 C) FOR THE YEAR TO JUNE 30 AFTER CURTAILING LOSSES AT SPORTSGIRL, ITS DISCONTINUED AUSTRALIAN SUBSIDIARY, AND IMPROVING TURNOVER IN ITS CONTINUING SOUTH AFRICAN OPERATIONS.
BUOYED BY BETTER SALES AND HIGHER REVENUES FROM FRANCHISE OPERATIONS IN AFRICA AND THE MIDDLE EAST, THE GROUP INCREASED HEADLINE EARNINGS FROM ALL OPERATIONS BY 19,8% TO R147,9 MILLION ( R123,5 MILLION).
THE FINAL DIVIDEND WAS MAINTAINED AT 6,5C PER SHARE FOR A TOTAL DISTRIBUTION OF 12,5C PER SHARE FOR THE YEAR. SHAREHOLDERS MAY ELECT TO RECEIVE CAPITALISATION SHARES IN LIEU OF THE CASH DIVIDEND.
A CHANGE IN THE DEBTOR WRITE-OFF POLICY, RESULTING IN A R17 MILLION WRITE-OFF, AND REDUCED INVESTMENT AND EXPORT PARTNERSHIP INCOME SAW HEADLINE EARNINGS FOR THE CONTINUING OPERATIONS - THE SOUTH AFRICAN TRUWORTHS BUSINESS - DECLINE TO 37,3C FROM 38,9C PER SHARE.
AN EXCEPTIONAL ITEM, COVERING LOSSES OF R146,4 MILLION ARISING FROM THE DISCONTINUANCE OF SPORTSGIRL AND A R11 MILLION WRITE-DOWN OF A HEADLEASE INVESTMENT, RESULTED IN AN ATTRIBUTABLE LOSS OF R9,4 MILLION, AGAINST A PROFIT OF R130,7 MILLION LAST YEAR.
SPORTSGIRL'S NET ASSETS WERE WRITTEN OFF IN FULL AFTER THE COMPANY WAS PLACED UNDER VOLUNTARY ADMINISTRATION LAST NOVEMBER. SPORTSGIRL'S LOSS AFTER INTEREST FOR THE FIVE MONTHS TO NOVEMBER WAS R20,3 MILLION, AGAINST R45,1 MILLION FOR THE FULL 1999 YEAR.
EXECUTIVE CHAIRMAN MICHAEL MARK SAID THE GROUP'S BALANCE SHEET WAS UNGEARED, WITH HEALTHY CASH BALANCES OF R150,9 MILLION, NOTWITHSTANDING THE REPAYMENT OF OFFSHORE BORROWINGS OF R180,9 MILLION.
"WITH THE SALE OF THE SPORTSGIRL BUSINESSES, MANAGEMENT WAS ABLE TO FOCUS ON THE CORE TRUWORTHS BUSINESS WHICH ENJOYED A STRONG LAST QUARTER ", HE SAID. "THAT SPURT HELPED SALES AT TRUWORTHS AND FRANCHISES TO GROW 13,5% TO R1,4 BILLION FROM LAST YEAR'S R1,2 BILLION. THE GROWTH CAME FROM GOOD CORE
DEPARTMENT SALES AND THE SUCCESS OF ELEMENTS, THE NEW VENTURE INTO COSMETICS. TONY TAYLOR, DEPUTY MD, SAID MANAGEMENT WAS ALSO ENCOURAGED BY THE PERFORMANCE OF THE IDENTITY CASH CHAIN.
"AFTER SOME TEETHING PROBLEMS, IT'S PROVED TO BE A CONCEPT WORTH DEVELOPING FURTHER."
HE SAID MANAGEMENT WAS CONFIDENT OF IMPROVED RESULTS IN THE YEAR AHEAD, ASSUMING REASONABLE ECONOMIC CONDITIONS.
"WE EXPECT TO INCREASE EARNINGS FROM CONTINUED IMPROVEMENT AT TRUWORTHS AND OUR GROWTH STRATEGIES. THESE INCLUDE FURTHER EXPANSION OF THE IDENTITY AND ELEMENTS BUSINESSES AND OF THE FRANCHISE OPERATIONS IN THE MIDDLE EAST AND AFRICA. WE ALSO EXPECT TO SEE THE BENEFITS OF A CRITICAL RE-EVALUATION OF EXPENSES IN THE YEAR AHEAD." - ENDS - ISSUED FOR: TRUWORTHS INTERNATIONAL LTD BY: DE KOCK & KERKHOFF COMMUNICATION CONSULTANTS
INQUIRIES: TONY TAYLOR 021-460-7950; WAYNE VAN DER MERWE 021-460-7955 CHRIS DURHAM 021-460-7502 MIKE KERKHOFF 021-424-5280