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AVI LIMITED - Voluntary Trading Update and Statement for the Six Months ended 31 December 2019

Release Date: 23/01/2020 15:10
Code(s): AVI     PDF:  
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Voluntary Trading Update and Statement for the Six Months ended 31 December 2019

AVI Limited
(Incorporated in the Republic of South Africa)
(Registration number 1944/017201/06) Share code: AVI
ISIN: ZAE000049433
(“AVI” or “the Group”)


The semester’s trading environment remained difficult with weak consumer spending constraining sales volumes in
many of our categories. This was exacerbated by competitor discounting in some categories and the impact of
Black Friday, which both diverted consumer spending and constrained December sales. Significant load shedding
in early December exacerbated a challenging trading month, particularly for the retail brands.

Group revenue for the semester was 1,0% higher than for the same period last year. The consolidated gross profit
margin was well protected and costs were carefully managed resulting in operating profit being marginally higher
than in the same period in the prior year.

The food and beverage businesses performed well in a difficult environment growing operating profit ahead of
inflation. This was offset by decline in the personal care and footwear brands which continued to experience volume
pressure in some categories, including weaker sales for Spitz in the material December trading month. Cash flows
remained strong through the semester.

Net finance costs were higher than last year due to higher average borrowing levels notwithstanding lower
borrowings at the end of the semester, while earnings from I&J’s joint venture with Simplot decreased materially
due to the sale of the joint venture interest as well lower earnings to the date of sale.

Capital items increased significantly due mainly to the disposal of I&J Holdings Proprietary Limited’s interest in its
joint venture with Simplot Australia Proprietary Limited, which was announced on 7 November 2019. This
transaction resulted in a capital gain of approximately R370 million.

The weighted average number of shares in issue during the period was 0,3% 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.

The following disclosure is made in accordance with Section 3.4 (b) of the Listings Requirements of the JSE

     -   Consolidated headline earnings per share for the six months ended 31 December 2019 are expected
         to decrease by between 3% and 5% over the comparable period in the prior year, translating into a
         decrease from last year’s 305.5 cents to a range of between 290 and 296 cents per share; and

     -   Consolidated earnings per share for the six months ended 31 December 2019, including capital gains
         and losses, are expected to increase by between 35,0% and 37,0% over the comparable period in the
         prior year, translating into an increase from last year’s 303,2 cents to a range of between 409 and 415
         cents per share.

It is expected that AVI will release its results for the six months ended 31 D e c e m b e r 2019 on or about 9
March 2020.

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

23 January 2020

Sponsor                  The Standard Bank of South Africa Limited
Enquiries                +(27) 11 502 1300

Date: 23-01-2020 03:10:00
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