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NETCARE LIMITED - Trading Statement in respect of the year ended 30 September 2016

Release Date: 15/11/2016 17:42
Code(s): NTC     PDF:  
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Trading Statement in respect of the year ended 30 September 2016

NETCARE LIMITED
(Registration number 1996/008242/06)
Code: NTC
ISIN: ZAE000011953
("Netcare")


TRADING STATEMENT IN RESPECT OF THE YEAR ENDED 30 SEPTEMBER 2016

Netcare is in the process of finalising its audited results for the year ended 30 September 2016 (“FY2016 Results”),
which will be released on the Stock Exchange New Service of the JSE on Monday, 21 November 2016.

In terms of paragraph 3.4 (b) of the JSE Listings Requirements, companies are required to publish a trading
statement as soon as they become reasonably certain that the financial results for the period to be reported upon
next will differ by at least 20% from that of the previous corresponding period.

In its previous trading statement issued on 27 September 2016, Netcare advised that its FY2016 Results would
include a material but technical, non-cash fair value accounting charge arising from a change in assumptions
underlying the basis of valuing the Retail Price Index (“RPI”) swap instruments held by its UK subsidiary, BMI
Healthcare (“BMI”). These RPI swaps are related to the existing long-term leases of BMI and are expected to be
eliminated as part of the rent reduction transaction currently being negotiated with BMI’s major external landlord.
At the time of the previous trading statement, the amount of the non-cash fair value accounting charge had not yet
been determined and Netcare therefore advised that, purely as a result of the non-cash fair value accounting charge
on the RPI swaps, its Earnings per Share (“EPS”) and Headline Earnings per Share (“HEPS”) in the FY2016 Results
would fall below those of the prior year by at least 20%.

Netcare is now able to advise that, for reasons that relate solely to the factors described above, earnings are
anticipated to be between 30.0% and 32.5% (R722 million and R782 million) lower and EPS between 30.0% and
32.5% (53.7 cents and 58.1 cents) lower than those for the previous financial year of 178.9 cents. Headline earnings
are anticipated to be between 30.0% and 32.5% (R702 million and R761 million) lower and HEPS between 30.0% and
32.5% (52.2 cents and 56.6 cents) lower than those for the previous financial year of 174.1 cents.

Shareholders are reminded that this fair value accounting charge has no commercial effect on the financial status of
Netcare as it is non-cash and unrealized at the financial year-end. Furthermore, in addition to the mandatory EPS
and HEPS metrics, Netcare also publishes an “adjusted HEPS” figure, which it believes to be a more appropriate
indicator of sustainable performance, and which excludes the impact of non-cash fair value movements on swap
instruments. Netcare’s “adjusted HEPS” will not be adversely affected by the non-cash fair value accounting charge
on the RPI swaps. Adjusted headline earnings are anticipated to be between 4.0% and 6.5% (R102 million and R165
million) higher and adjusted HEPS between 4.0% and 6.5% (7.6 cents and 12.3 cents) higher than those for the
previous financial year of 189.0 cents.

The information provided in this trading statement has not been reviewed or reported on by Netcare’s external
auditors.

Johannesburg
15 November 2016

Sponsor
Deutsche Securities (SA) Proprietary Limited

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