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REMGRO LIMITED - Trading statement for the six months ended 31 December 2023

Release Date: 11/03/2024 17:36
Code(s): REM     PDF:  
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Trading statement for the six months ended 31 December 2023

Remgro Limited
(Incorporated in the Republic of South Africa)
(Registration number 1968/006415/06)
ISIN: ZAE000026480
JSE and A2X Share code: REM
("Remgro" or "the Company")


Paragraph 3.4(b) of the Listings Requirements of the JSE Limited ("JSE") requires companies to publish a trading
statement as soon as they become reasonably certain that their financial results for the period to be reported upon
next will differ by at least 20% from those of the previous corresponding period. Remgro's results for the six
months ended 31 December 2023 ("current period") are due to be released on the Stock Exchange News Service
("SENS") on or about 19 March 2024.

Shareholders are advised that Remgro's headline earnings per share ("HEPS") for the current period is expected
to be between 344 cents and 407 cents compared to the HEPS of 626 cents reported for the six months ended
31 December 2022 ("the comparative period"), an expected decrease of between 35.0% and 45.0%.

A significant driver of the decline in headline earnings relates to the effect of the corporate actions implemented
in the recent past, majority of which are non-recurring items. The difficult operating environment, particularly in
relation to the trading results of Heineken Beverages Holdings Limited ("Heineken Beverages") also contributed
to the material decline in headline earnings.

To promote comparability between reporting periods, Remgro also discloses an alternative HEPS measure
excluding the effect of these corporate actions ("HEPS, adjusted for corporate actions"). For the current and
comparative periods, these corporate actions and their impact on headline earnings include the following:
-    the IFRS 3 amortisation and depreciation charges for the current period relating to the additional assets
     identified when Heineken Beverages obtained control over Distell Group Holdings Limited ("Distell") and
     Namibia Breweries Limited ("Heineken IFRS 3 impact");
-    Remgro's portion of the negative fair value adjustment (FVA) made by TotalEnergies Marketing South
     Africa Proprietary Limited on its Natref stock in the current period, due to Natref being classified as held for
     sale in terms of IFRS 5;
-    Remgro's portion of the transaction costs incurred relating to the Mediclinic Group Limited ("Mediclinic")
-    Remgro's portion of a debt forgiveness gain that was accounted for by Kagiso Tiso Holdings Proprietary
     Limited ("KTH") in the comparative period (a lender waived its right to receive an outstanding amount of a
     loan to KTH) as part of the disposal of its investment in Actom Investment Holdings Proprietary Limited;
-    Grindrod Limited's ("Grindrod") equity accounted income until its unbundling during October 2022.

HEPS, adjusted for corporate actions, for the comparative period is based on the adjustments detailed below.

                                                                                Six months ended 31 December
R million                                                                           2023                2022
Headline earnings                                                                                      3 529
Heineken IFRS 3 impact                                                               178                   -
Negative FVA on Natref's stock                                                       377                   -
Transaction costs relating to the Mediclinic acquisition                             165                  19
KTH debt forgiveness gain                                                              -                (227)
Grindrod equity accounted income                                                       -                 (60)
Headline earnings, adjusted for corporate actions                                                      3 261
Weighted number of shares (million)                                                554.5               563.6

Remgro's HEPS, adjusted for corporate actions, for the current period is expected to be between 492 cents and
533 cents compared to the HEPS, adjusted for corporate actions, for the comparative period of 579 cents (based
on the adjustments detailed above), an expected decrease of between 8.0% and 15.0%. This decrease is largely
driven by:
-    the loss contributed by Heineken Beverages (excluding the Heineken IFRS 3 impact) compared to the profit
     contributed by Distell in the comparative period. Heineken Beverages' volumes were impacted by lower
     industry growth, loadshedding, a shift from premium to mainstream and a challenging competitive
     environment. Margins were also negatively impacted by non-recurring expenses related to integration and
     supply chain challenges;
-    a lower contribution from Community Investment Ventures Holdings Proprietary Limited mainly due to
     higher finance costs resulting from increased interest rates; and
-    a special dividend received from FirstRand Limited of R154 million in the comparative period.

Shareholders are reminded that Remgro utilises headline earnings per share only as the relevant criteria for trading
statement purposes, pursuant to paragraph 3.4(b)(vi) of the Listings Requirements.

The estimated financial information on which this trading statement is based has neither been reviewed nor
reported on by the Company's external auditors.

11 March 2024

RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 11-03-2024 05:36:00
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