| Tue 6 Nov 2007, 15:23 | | AMA - Amalgamated Appliance Holdings Limited - Tra |
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AMA
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AMA - Amalgamated Appliance Holdings Limited - Trading update
Amalgamated Appliance Holdings Limited
Incorporated in the Republic of South Africa
Registration number 1997/004130/06
Share code: AMA & ISIN: ZAE000012647
("AMAP" or "the company")
TRADING UPDATE
In our statement of reviewed results for the financial year ended 30 June 2007,
we highlighted the adverse conditions experienced in the latter six months of
the year, particularly in the brown goods category. We further described our
short-term action plan to address the difficult trading circumstances, which
plan included restructuring and pruning several activity areas. The costs of
such actions will be reflected in the short-term performance with the resultant
improvements only evident later.
The first three months of our 2007/8 financial year have followed the muted
trading pattern experienced in the last six months of the prior period. The
July strikes, interest rate hikes and the introduction of the National Credit
Act adversely affected retailer durable goods sales and Amap`s sales performance
reflected that of the retail network. In addition, certain hitches in the
global supply chain significantly delayed the rollout of our locally
manufactured LCD TV range, which inhibited sales performance in that critical
category.
Simultaneously, price hikes in both finished goods and components from our
Eastern suppliers were imposed and fierce competition for market share rendered
it difficult to transfer these increases to the trade, resulting in further
margin pressure.
As a consequence of these factors and the negative accounting impact of fair
value adjustments, assuming the Rand/Dollar exchange rate remains at current
levels, the Board expects earnings per share and headline earnings per share for
the six months to 31 December 2007 to be between 70% and 90% lower than the
corresponding period last year. It should be noted that, in the year to June
2007, our entire trading profit was earned in the first six months, thus
exacerbating the comparative difference. We expect to close a portion of this
earnings gap by financial year end.
The financial information on which this trading update has been based has not
been reviewed or reported on by Amap`s auditors.
Johannesburg
6 November 2007
Sponsor: Bridge Capital Advisors (Pty) Limited
Date: 06/11/2007 15:23:01 Produced by the JSE SENS Department.
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