Voluntary Trading Update and Statement for the six months ended 31 December 2018
(Incorporated in the Republic of South Africa)
(Registration number 1944/017201/06)
Share code: AVI
(“AVI” or “the Group”)
VOLUNTARY TRADING UPDATE AND STATEMENT FOR THE SIX MONTHS ENDED 31 DECEMBER 2018
Comparisons to prior year results in the commentary are made on a like-for-like basis, before taking
reclassifications in terms of the new revenue and lease accounting standards, which were adopted with effect from
1 July 2018, into account.
Group revenue for the semester was 0.2% higher than for the same period last year. The trading environment
remained difficult with continued pressure on consumer spending resulting in sales volume weakness in many of
our businesses and was exacerbated by competitor discounting in some categories. In particular December’s sales
volumes were lower than last year including in Spitz which was unable to repeat last year’s record December sales
Selling prices were increased in selected categories where there was a need to ameliorate accumulated cost
pressures, but were maintained throughout the period for the most part. Gross profit margins were well protected
reflecting generally low raw material cost inflation and good cost control. Despite tight management of selling and
administrative costs, operating profit was lower than for the first semester of last financial year mainly due to the
impact of the lower volumes. Cash flows remained strong through the semester.
In addition, the semester’s results were impacted by provisions for the significant restructuring at Green Cross, and
an unfavourable movement in the mark-to-market adjustment on I&J’s fuel hedges resulting from the low oil price
at the end of the period.
The impact of the new revenue and lease accounting standards, adopted with effect from 1 July 2018, on headline
earnings for the period was negligible.
The weighted average number of shares in issue during the period was 0,6% higher than in the same period last
year due to the issue of new shares in terms of the Group’s various share incentive schemes, including the black
staff empowerment share scheme.
The following disclosure is made in accordance with Section 3.4 (b) of the Listings Requirements of the JSE Limited:
- Consolidated headline earnings per share for the six months ended 31 December 2018 are expected
to decrease by between 6% and 7% over the comparable period in the prior year, translating into a
decrease from last year’s 325.6 cents to a range of between 303 and 306 cents per share; and
- Consolidated earnings per share for the six months ended 31 December 2018, including capital gains
and losses, are expected to decrease by between 6,5% and 7,5% over the comparable period in the prior
year, translating into a decrease from last year’s 326,2 cents to a range of between 302 and 305 cents
It is expected that AVI will release its results for the six months ended 31 December 2018 on or about 11 March
The information above has not been reviewed and reported on by the Group’s auditors.
25 January 2019
Sponsor The Standard Bank of South Africa Limited
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