| Thu 6 Mar 2008, 15:40 | | DLV - Dorbyl - Trading Update |
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DLV
DLV
DLV - Dorbyl - Trading Update
DORBYL LIMITED
(Incorporated in the Republic of South Africa)
(Registration no. 1911/001510/06)
Ordinary share code: DLV
ISIN: ZAE000002184
("Dorbyl")
Trading Update
Dorbyl hereby advises that for the financial year ending 31 March 2008, it is
expected that headline earnings per share will reflect a loss of between 150 and
190 cents per share (compared to the headline earnings per share of 7,3 cents
for the previous comparative year) and in respect of earnings between a loss of
203 and 243 cents per share (compared to earnings per share of 40,1 cents for
the previous comparative year).
The underlying reasons for the deterioration in the results were predominantly
the negative impact of global price pressures from Original Equipment
Manufacturers combined with increased input costs which were not fully
recoverable from customers. In addition, problems of under utilisation of
capacity and inefficiency at the forging and machining operation in Uitenhage
caused this operation to be the main loss contributor during the current
financial year. This operation is being restructured, resulting in downsizing of
the operation, including retrenchments and costs related thereto. These costs
have been largely taken into account in the expected results as aforementioned.
Combined with these factors, the introduction of various new models in the motor
manufacturing sector, which by virtue of their run-out and ramp-up process,
affected the regular supply of product with the resultant adverse effect on
operating results.
The rebuild of the casting and machining operation in Benoni is proceeding
according to plan but also included restructuring and retrenchments with costs
related thereto.
Market conditions are expected to remain challenging for the financial year
ending 31 March 2009. The strategy of re-structuring the business in conjunction
with new product development with off-shore partners as alluded to in the half-
year results remains on track. A number of these interventions are scheduled to
be concluded during the first half of the 2009 financial year and are expected
to have a positive impact on the company in the medium term.
Released simultaneously with this trading update are the following two
transaction announcements:
Dorbyl has entered into a Joint Venture with Magnetto Wheels S.p.A, a company
incorporated in Italy, in terms of which Dorbyl has disposed of 50% of its
interest in its wholly-owned subsidiary Guestro Wheels (Proprietary) Limited,
effective 31 March 2008. Further details are set-out in that transaction
announcement.
Dorbyl has entered into an agreement whereby it will dispose of approximately
40% of the property situated at Struandale, Port Elizabeth. Further details are
set-out in that transaction announcement.
The information in this trading statement has not been reviewed or reported on
by Dorbyl`s auditors.
Johannesburg
6 March 2008 Sponsor: PSG Capital (Pty) Limited
Date: 06/03/2008 15:40:00 Produced by the JSE SENS Department.
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