METAIR INVESTMENTS LIMITED - Voluntary trading statement and trading update

Voluntary trading statement and trading update

METAIR INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1948/031013/06
JSE share code: MTA
ISIN: ZAE000090692
(“Metair” or the “Company”)

VOLUNTARY TRADING STATEMENT AND TRADING UPDATE

Metair is in the process of finalising its results for the year ended 31 December 2016 (“Results”) and
shareholders are accordingly advised that Metair expects to report:

   -   headline earnings per share to be between 9.68% and 7.26% lower (between 224 cents and
       230 cents per share) than the 248 cents per share for the previous corresponding period; and
   -   earnings per share to be between 16.85% and 14.61% lower (between 222 cents and 228 cents
       per share) compared to the 267 cents per share for the previous corresponding period.

Operational comment

Trading for the period ended 31 December 2016 started with a model change in the automotive
components vertical and the Company experienced model launch challenges during the first half of the
year. Fortunately most of the automotive components businesses, except the wire harness business,
managed to settle during the second half of the year and eliminated most of the premium support cost
associated with the launch.

The energy vertical had a strong finish to the year as the Turkish and Romanian battery businesses
experienced record production output for the year on the back of excellent last quarter demand. The
energy storage vertical performance in South Africa continued to be challenged in the second half of
the year.

Automotive Components

The business is expected to achieve low double digit full year turnover growth as technology
advancements, an overall weaker ZAR currency, product and customer expansion countered the
anticipated 10% overall volume reduction linked to our major product exposure associated with new
models.

The Company expects this vertical to achieve profit before interest and tax (“PBIT”) margins of between
5% and 7% for the full year. The second half margins are higher than the guidance provided previously
of between 6% and 8%, due to improved stability in production volumes and manufacturing efficiency,
elimination of the premium support cost associated with the launch, as well as benefitting from a
stronger ZAR currency relative to the EUR, USD and a weaker JPY during the last quarter of 2016.

New model launches are always associated with lower margins, and therefore Metair maintains its
guidance that the achievement of targeted production volumes and efficiencies associated with the new
technology and stabilisation of manufacturing processes should result in medium term PBIT margins
on new business of between 6% and 8%.

Energy Storage vertical

Traditionally strong seasonal volume demand in the winter markets served by Rombat and Mutlu Akü
in Europe and the Middle East, supported by a strong performance from Mutlu Akü in particular, resulted
in growth in operating profit for the full year within these markets.

Within the South African market, margins were negatively impacted by local market competition which
intensified during the second half of the year, as well as disruption and inefficiency caused by the
establishment of a dedicated original equipment manufacturer production facility.

Due to the mixed performance from the Energy Storage vertical’s operating regions, low single digit
improvement in operating profit for this vertical is expected when compared to the previous
corresponding period.

The financial information on which this voluntary trading statement and trading update is based has not
been reviewed or reported on by Metair’s external auditors.

It is expected that the Results will be announced on or about Thursday, 23 March 2017.



9 February 2017
Johannesburg

Sponsor
One Capital

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