ITALTILE LIMITED - Sales Update and Initial Trading Statement

Sales Update and Initial Trading Statement

ITALTILE LIMITED
Incorporated in the Republic of South Africa
(Registration number: 1955/000558/06)
Share code: ITE   ISIN: ZAE000099123
("Italtile" or "the Group")


SALES UPDATE AND INITIAL TRADING STATEMENT


SALES

This sales update pertains to the period 01 July 2020 to 30 November
2020 (“review period”).

Sales related to Ceramic Industries Proprietary Limited and Ezee Tile
Adhesive Manufacturers Proprietary Limited are referred to as
"manufacturing" sales to distinguish them from "retail" sales reported
by Italtile´s retail brands, namely CTM, Italtile Retail, TopT and U-
Light.

Total retail store sales grew by 16.4% for the review period, while
like-for-like retail store sales increased by 14.9%.

Manufacturing sales for the review period were up 16.0% compared to
the previous corresponding period.

Double-digit growth was reported across all of the Group’s operations
(retail brands, supply chain and manufacturing businesses).


TRADING CONDITIONS

The improved sales are attributable to a range of factors including:

    -   the Group’s local integrated supply chain which ensured
        consistent availability of a wide product range;
 
    -   the current work-from-home trend, precipitated by the Covid-19
        pandemic (“pandemic”), which boosted demand for home improvement
        products;

    -   lower interest rates and payment holidays, which have supported
        homeowners’ spend on their primary asset – their homes. In
        addition, with restrictions on travel and leisure activities,
        some funds previously allocated to transport and recreational
        pastimes were reallocated to home improvements; and

    -   management’s continued focus on improving the customer shopping
        experience, including implementing rigorous risk mitigating
        measures to ensure a safe operating environment for customers
        and staff.


INITIAL TRADING STATEMENT AND OUTLOOK

In terms of paragraph 3.4(b) of the JSE Limited ("JSE") Listings
Requirements, and in light of this sales update, the Board of Directors
(“Board”) is satisfied that a reasonable degree of certainty exists
that the Group's results for the six months ending 31 December 2020
will increase by at least 20% compared to the earnings per share and
headline earnings per share of 55.3 cents for the six months ended 31
December 2019, with earnings per share and headline earnings per share
expected to be in excess of 66.4 cents per share.

The trading environment remains unpredictable in the context of the
pandemic, inhibiting accurate guidance in terms of performance for
the balance of the six months to end 31 December 2020. Accordingly,
the Board has resolved that a further announcement will be made in
due course once there is greater clarity regarding the anticipated
range of improvement in earnings per share and headline earnings per
share for the six months ended 31 December 2020.

The above information has not been reviewed and reported on by the
Group´s external auditors.


Johannesburg
2 December 2020

Sponsor
Merchantec Capital

Date: 02-12-2020 08:00:00
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