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PPC LIMITED - Trading Statement

Release Date: 01/06/2017 17:25
Code(s): PPC     PDF:  
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Trading Statement

PPC Ltd
(Incorporated in the Republic of South Africa)
(Company registration number: 1892/000667/06)
ISIN: ZAE 000170049
JSE / ZSE Code: PPC
("PPC" or the "Company")

TRADING STATEMENT

In terms of the Listing Requirements of the JSE Limited, 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 on next
will differ by more than 20% from those of the previous corresponding
period.

PPC is finalising its results for the financial year ended 31 March 2017.
It should be noted that as the comparable period results related to a six
month period following the change in the Company’s financial year from
September to March, for ease of comparison, pro forma financial information
reflecting the calculation of the twelve month financial information to
March 2016 was released on SENS on 9 March 2017. The results for the
financial year ended 31 March 2017 are accordingly compared to the pro
forma financial results for the twelve months ended 31 March 2016.

Group EBITDA is projected to contract by 10 - 15%, whilst net profit
attributable to PPC shareholders is expected to decline by 85 - 95%.

Basic earnings and headline earnings per share for the year ended 31 March
2017 are expected to be between 85% and 95% lower (between 18 cents and 6
cents; and between 16 cents and 5 cents respectively) compared to 117 cents
and 107 cents for the 12 months ended 31 March 2016, adjusting for the
weighted average number of shares.

On a normalised basis and taking cognizance of the increased weighted
average number of shares following the rights issue and conclusion of part
of the BEE1 transaction, earnings and headline earnings per share are
expected be between 25% and 35% (between 50 cents and 43 cents per share)
below the comparable pro forma reporting period. Weighted average number of
shares used for this calculation is 1,14 billion.

Summary of expected earnings:

Earnings in cents               Year ended      Pro forma 12       % change
                                             months to March
                                March 2017
                                                        2016
Basic EPS                           18 - 6               117    (85% - 95%)
Basic HEPS                          16 - 5               107    (85% - 95%)
Normalised* EPS                    50 - 43              66**    (25% - 35%)
Normalised*** HEPS                 50 - 43              66**    (25% - 35%)
WANS*** (millions)                   1,137               680            68%

* Normalised earnings adjusts the reported earnings for the effects of
empowerment transaction IFRS 2 charges, restructuring costs, foreign
exchange movements on DRC VAT receivable and impairments and other
exceptional items, net of taxation and prior year taxation adjustments
** Aligned to the number of shares used in the March 2017 EPS and HEPS
calculations
*** Weighted average number of shares
The key contributors to the decline in profitability relate to:
i)   Higher financing costs as a result of raising fees and related
     interest charges for the R2 billion liquidity and guarantee facility
     raised in June 2016 to facilitate repayment of PPC’s bonds;
ii) A weaker trading environment in the South African and Botswana
     businesses, coupled with a stronger rand dollar exchange rate
     negatively impacting Zimbabwe’s contribution in rand terms;
iii) Additional IFRS 2 charges have been recognised in the current
     reporting period. This follows shareholder approval to amend terms
     relating to specific participants of the Company’s first BEE
     transaction and the recapitalisation of certain of the BEE1 entities;
iv) The devaluation of certain local currencies, in particular in the DRC
     and Rwanda, has led to revaluation losses; and
v)   The once-off nature of the exceptional profit made last year on the
     sale of non-core assets has also contributed to the period-on-period
     decline in net profit and basic earnings per share.

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

PPC will release its final results for the year ended 31 March 2017 on 7
June 2017.

1 June 2017
Sponsor
Merrill Lynch South Africa (Pty) Limited

Date: 01/06/2017 05:25:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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