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DEL
DEL
DEL - Delta Electrical Industries - Trading Statement
Delta Electrical Industries Limited
Incorporated in the Republic of South Africa
(Registration number 1919/006020/06)
Share code: DEL & ISIN: ZAE000002036
("Delta" or "the Company" or "the Group")
TRADING STATEMENT
Delta shareholders are referred to the un-audited Group results for the six
months ended 27 June 2008 released on SENS on 11 August 2008 in which
shareholders were advised that:
"Sales volumes are expected to reduce during the second half as Australian EMD
stocks are depleted and South African sales to Europe reduce, whilst the average
selling price is expected to improve with a more favourable sales mix. Improved
operational efficiencies and reduced overhead costs are expected to afford a
favourable operating profit during the second half."
In addition, shareholders are referred to the shareholder update announcement
released on SENS on 24 October 2008 in which the following was advised:
"The Group`s Delta EMD business continues to trade profitably and to generate
cash .."
The Company is now in a position to advise shareholders that the trading
performance of the business for the twelve months ending 27 December 2008 is
forecast to be a substantial improvement from the year ended 27 December 2007.
Earnings before taxation is forecast to be between R102 million and R122 million
and headline earnings before taxation is forecast to be between R104 million and
R125 million for the twelve months ending 27 December 2008(2007: Loss before
taxation of R222.1 million and headline loss before taxation of R141.4 million).
Earnings and headline earnings before taxation have been reduced by the cost
incurred in managing the Group`s Australian EMD plant since production ended at
that plant during March 2008, and increased by gains realised on the sale of
certain Australian raw materials. Excluding the costs related to the closure of
the Australian plant and the gains realised on raw materials, earnings before
taxation is forecast to be between R115 million and R137 million and headline
earnings before taxation is forecast to be between R117 million and R143 million
for the twelve months ending 27 December 2008.
Operating profit before taxation for the twelve months ending 27 December 2008
is forecast to be between R130 million and R158 million, inclusive of the costs
in managing the Australian plant since production ended in March 2008 and the
gains realised on the sale of certain raw material, which compares to an
operating loss before taxation of R68.2 million for 2007, excluding closure
costs and a profit on sale of land in Australia.
Earnings per share for the twelve months ending 27 December 2008 are forecast to
be between 145 cents and 177 cents (2007: Loss per share of 419 cents).
Headline earnings per share are forecast to be between 146 cents and 178 cents
(2007: Headline loss per share of 297.9 cents).
Cash balances are forecast to be in excess of R200 million at 27 December 2008
(December 2007: R218.3 million). This is after the return of capital by way of a
capital reduction of R112.6 million (229 cents per share) and the payment of a
special dividend of R49.2 million (100 cents per share) to shareholders during
2008.
Necessary cash balances will be retained until such time as the cost of
rehabilitating the Kooragang Island residue disposal facility in Australia is
determined and a tax query relating to the Group`s sale of its Industrial
Services businesses during 2005 is resolved. The board anticipates payment of
further special dividends when the cost of rehabilitating the Kooragang Island
residue disposal facility is determined, when the 2005 tax query is favourably
resolved and when value is realised through the sale of the Group`s Australian
EMD production site and Kooragang Island residue disposal facility.
Opportunities for realising value from the sale of the Group`s land, plant and
equipment in Australia continue to be developed with favourable prospects.
The board also anticipates payment of regular dividends following the Group`s
year end results.
The forecast financial information on which this trading statement is based has
not been reviewed and reported on by Delta`s auditors. Delta`s results for the
twelve months ending 27 December 2008 are expected to be released on or about 23
February 2009.
Johannesburg
15 December 2008
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 15/12/2008 07:05:22 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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