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AVI LIMITED - Voluntary Trading Update and Statement for the year ended 30 June 2015

Release Date: 21/07/2015 13:19
Code(s): AVI     PDF:  
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Voluntary Trading Update and Statement for the year ended 30 June 2015

                                               AVI Limited
                                  (Registration number 1944/017201/06)
                                               Share code: AVI
                                            ISIN: ZAE000049433
                                            (“AVI” or “the Group”)


  VOLUNTARY TRADING UPDATE AND STATEMENT FOR THE YEAR ENDED 30 JUNE 2015

The following update is based on the latest available trading information for the year ended 30 June 2015.

Segmental revenue for the year ended 30 June 2015


                                                          2015             2014         Change
                                                           Rm               Rm              %

 Entyce beverages                                        3,041            2,717             11.9
 Snackworks                                              3,405            3,058             11.3
 I&J                                                     1,961            1,823               7.6
 Personal care                                           1,033            1,044             (1.0)
 Footwear and apparel                                    1,796            1,615             11.2
 Corporate                                                   8               10
                GROUP                                   11,244           10,267              9.5


Overall sales performance for the year was sound in a tough trading environment with the group realising
higher selling prices in all categories following significant accumulated cost pressure from the weaker Rand.
Volume growth was achieved in many of our categories and I&J’s export revenue benefitted from the Rand
weakness. Indigo’s revenue from owned brands increased by 10% however total revenue declined following
the revision of trading terms with Coty and the consequent exclusion of Coty product sales revenue from
group revenue.

Entyce and Snackworks did well to manage cost pressures and a tougher consumer environment with
moderate gains in gross profit margins and volume growth in some categories. I&J’s second semester result
was not as strong as anticipated because of unusually inconsistent fishing catch rates in the fourth quarter of
the financial year, which resulted in additional fishing costs as well as the deferral of sales into the next
financial year. Indigo’s own brand portfolio performed well in the second semester with gains in revenue and
improved margins following price increases in the core deodorant category. Spitz enjoyed strong demand for
its core brands and maintained strong gross profit margins notwithstanding the impact of the weaker Rand.
Green Cross made progress in the second semester with better margins and improved trading from the
refurbished retail doors.

The consolidated gross profit margin and operating profit margin both improved in comparison to the prior
year.


Other factors impacting on the consolidated results for the year, compared to the prior financial year, were:

    -   The first semester of the prior financial year included a net after tax capital gain of R122,0 million in
        respect of a payment of R150,0 million from Coty to Indigo following the revision of their commercial
        relationship; and
    -   The weighted average number of shares in issue during the period was 1,6% higher than in the same
        period last year due to the issue of new shares in terms of the group’s various share incentive
        schemes, including the black staff empowerment share scheme.

The following disclosure is made in accordance with Section 3.4 (b) of the Listings Requirements of the JSE
Limited:

    -   Consolidated headline earnings for the year ended 30 June 2015 are expected to increase by
        between 11% and 12% over the prior year, and headline earnings per share, taking the increased
        number of shares in issue into account, are expected to increase by between 9% and 10%. In cents
        per share this will be an increase from last year’s 383,6 cents to between 418 and 422 cents per
        share; and

    -   Consolidated earnings for the year ended 30 June 2015, taking capital gains and losses into account,
        are expected to increase by between 1% and 2% over the prior year. Consolidated earnings per
        share, taking the increased number of shares in issue into account, are expected to change by minus
        1% to 0% from the prior year. In cents per share this will be between 415 and 419 cents per share,
        compared to last year’s 419,3 cents per share.



It is expected that AVI will release its results for the year ended 30 June 2015 on or about 7 September 2015.

The information above has not been reviewed and reported on by the Group’s auditors.

Illovo
21 July 2015

Sponsor                 The Standard Bank of South Africa Limited
Enquiries               +(27) 11 502 1300

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