ELB GROUP LIMITED - Trading statement

Trading statement

ELB Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1930/002553/06)
Ordinary Shares:    Share code: ELR   ISIN: ZAE000035101
("ELB", "the Group" or "the Company")

TRADING STATEMENT

ELB is currently finalising its results for the six months ended
31 December 2015, which should be released on SENS on or about
Wednesday, 16 March 2016.

In this regard, shareholders are advised that the Group has
incurred a loss for the six month period ended 31 December 2015,
and that:

- earnings per share (“EPS”) is likely to be between 127% and 147%
(174.5 and 202.0 cents per share) lower than the EPS of 137.4
cents per share reported for the six month period ended 31
December 2014;

- headline earnings per share (“HEPS”) is likely to be between
128% and 148% (175.1 and 202.5 cents per share) lower than the
HEPS of 136.8 cents per share reported for the six month period
ended 31 December 2014.

The loss for the six months under review includes unrealised
foreign exchange adjustments arising from the severe depreciation
of the rand against the currencies of the Group’s major suppliers.

Conversely, the depreciating rand has resulted in gains in excess
of the loss for the six month period. These gains are to be
reported in other comprehensive income as arising from unrealised
foreign currency translation gains in respect of the Group’s
foreign operations.

RESULTS IN CONTEXT

The Group will from time to time experience volatility in earnings
particularly   during   periods  of   significant   exchange  rate
fluctuations.    These fluctuations may give rise to unrealised
profits or losses, which experience has shown usually reverse,
before or on the eventual sale of the relevant equipment.

The interim report will note that the industries which the Group
serves have experienced a deterioration of commodity prices, a
global economic slowdown, a deterioration of the rand, protracted
labour strikes, high unemployment and a low growth rate. This,
together with delayed large infrastructure spend by both public
and private sectors, has resulted in the Group experiencing
difficult trading conditions.

As the board noted in its review of operations of the 2015 annual
results the Group expects another difficult year for the South
African economy. With continuing pressure on global commodity
prices, we expect to see pressure on cash flows and the migration
from   large   infrastructure   projects  to   refurbishment   and
maintenance projects. The board is however confident that the
Group can harness the opportunities as they present themselves and
deliver on our strategy.

The Group is targeting a number of opportunities that should
position it favourably for the next twenty-four to thirty-six
months.

Shareholders are advised that the financial information on which
this trading statement is based has not been reviewed and reported
on by the Company’s external auditors.

Boksburg
8 March 2016

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

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