FINBOND GROUP LIMITED - Trading Update Year Ending 28 February 2019

Trading Update – Year Ending 28 February 2019

Finbond Group Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2001/015761/06)
Share code: FGL ISIN: ZAE00013895
(“Finbond” or “the Company” or “the Group”)


TRADING UPDATE – YEAR ENDING 28 FEBRUARY 2019

In terms of the Listings 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 next period to
be reported on will differ by more than 20% from that of the previous corresponding period.

A review of the year-to-date financial results for the year ending 28 February 2019 by the directors of
the Company has indicated that:

 • headline earnings per share will decrease by at least 11.71 cents per share, representing a
   percentage decrease of at least 35% compared to the 33.7 cents per share reported for the prior
   year; and

 • earnings per share will decrease by at least 10.95 cents per share, representing a percentage
   decrease of at least 35% compared to the 31.3 cents per share reported for the prior year.

The expected decreases are mainly due to the following factors:

    1. The non-recurrence of an exceptional profit of R22.6 million following a mandatory offer in
       the prior period.

    2. The increase in the weighted average number of shares by 19.7% from 748,569,555 to
       895,886,173, attributable to the rights issue in April 2018 and the scrip dividend in July 2018.

    3. South African business volumes have been under severe pressure due to a large portion of
       Finbond’s South African SASSA client base transitioning to the new SASSA card, resulting in a
       significant reduction in Finbond’s SASSA customer base. [As reported to shareholders in the
       Unaudited Consolidated Interim Results for the six months ended 31 August 2018 published on
       SENS on 7 November 2018]. This new card was launched by the SA Post Office and SASSA on
       3 May 2018, but does not avail the functionality to load EFT debits or stop orders, which
       limited Finbond’s ability to extend credit to this segment of the market and led to significantly
       increased SASSA write-offs and impairments. Finbond’s SASSA client base represented 16.7%
       of Group revenue for the year ending February 2018.

The SASSA impact set out above did not adversely affect Finbond’s non-SASSA South African client
base nor Finbond’s North American operations.

A further trading statement quantifying the expected earnings per share and headline earnings per
share, as required by the Johannesburg Stock Exchange Listings Requirements, will be released in due
course.

The financial information on which this trading statement is based has not been reviewed or reported
on by Finbond’s auditors. Finbond’s audited results for the period ended 28 February 2019 are
expected to be released on SENS on or before 31 May 2019.

Pretoria
8 February 2019

SPONSOR:
GRINDROD BANK LIMITED

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