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GRF - Group Five Limited - Trading statement and cautionary announcement GROUP FIVE LIMITED (Incorporated in the Republic of South Africa) (Registration number 1969/000032/06) Share code: GRF ISIN: ZAE000027405 ("Group Five" or "the group" or "the company") TRADING STATEMENT AND CAUTIONARY ANNOUNCEMENT CAUTIONARY ANNOUNCEMENT The board of directors of Group Five have resolved to dispose of the businesses that constitute the construction materials segment and, as such, the group is currently in discussions with several parties to effect these disposals. If successfully concluded, the disposals may have an effect on the price of the company`s shares. Accordingly, shareholders are advised to exercise caution when trading in the company`s shares until a further announcement has been made. TRADING STATEMENT Group Five shareholders are advised that, for the six months ended 31 December 2011, the group expects: * Fully diluted headline earnings per share ("FDHEPS") to be between 30%-36% lower (127 cents per share to 139 cents per share); * Headline earnings per share ("HEPS") to be between 35%-42% lower (124 cents per share to 139 cents per share); * Fully diluted earnings per share ("FDEPS") to be between 123% - 127% higher (81 cents per share to 96 cents per share); and * Earnings per share ("EPS") to be between 123% - 127% higher (81 cents per share to 96 cents per share) than the FDHEPS of 198 cents per share, the HEPS of 214 cent per share, the FDEPS of 354 cents loss per share and the EPS of 354 cents loss per share published for the previous corresponding period. In addition, and to assist for comparative purposes, * Earnings for the current period have not been affected materially by pension fund valuation adjustments * Earnings for the current period reflect an increase in fair value adjustments on service concessions within Investment and Concessions, regarded as a core component of the earnings within this segment, due to the early roll-out of the second phase of the A1 Project in Poland * The H1 F2012 FDHEPS and FDEPS guidance given above is calculated using fully diluted shares and thus mainly includes the effect of the shares held by the group`s BBBEE partners, which, due to the current lower value of the group`s share price, is antidilutive in the current period. * The group will be required to account for the construction materials segment (refer to cautionary statement above) as a discontinued operation and as Non-Current Assets Held for Sale. A restatement of both HEPS and FDHEPS for the prior reporting period will be required. To assist, the group discloses that the restated HEPS and FDHEPS for H1 F2011 is 251 cents per share and 233 cents per share respectively (previously reported at 214 cents per share and 198 cents per share) and thus the group advises that it expects * Fully diluted headline earnings per share ("FDHEPS") to be between 42% - 47% lower (123 cents per share to 135 cents per share); and * Headline earnings per share ("HEPS") to be between 45% - 50% lower (126 cents per share to 138 cents per share) than the restated FDHEPS of 233 cents per share and the restated HEPS of 251 cent per share, for the previous corresponding period. OPERATIONAL UPDATE The underlying performance of the group`s businesses performed broadly in line with management expectations and in accordance with the guidance provided in November 2011. The results were impacted by losses in the Construction Materials segment. The Civil Engineering results have been impacted in the short term by holding costs and losses in the Middle East from one contract as previously reported. Restructuring in the group had a net cost in the first half, the benefits of which will realise from H2 onwards. In addition, the group has continued to invest in future opportunities in targeted sectors, the benefits of which will not be realised in F2012. Manufacturing has improved well with an increase in volumes traded during the reporting period. In spite of sluggish domestic concessions and PPP activities and the economic pressures in Europe, Investments and Concessions performed well as new tolling contracts came on line in Eastern Europe. MARKET CONDITIONS Emphasis on a larger geographical footprint for more of the group`s business units and achieving early wins in the re-emergence of the mining and energy markets in Africa has assisted to mitigate, to some extent, the continued weakness in the South African construction and engineering markets. Despite the cancellation and delay in planned and awarded public sector works, particularly PPP projects which exacerbated the domestic market weakness, a slow broader market recovery from the second half of F2012 is expected to support some improvement in the group`s trading performance from F2013. REPORTING The above information has not been reviewed or reported on by Group Five`s auditors. The group`s results will be released on SENS on 13th February 2012 when the group will be updating the market on its business in a presentation in Johannesburg on the same day, and in Cape Town on 14th February 2012. The presentation will be available on the 13th February 2012 for all stakeholders on the group`s website, www.groupfive.co.za Johannesburg 27 January 2012 Investment Bank and Sponsor Nedbank Capital Date: 27/01/2012 15:35:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
