| Tue 19 May 2009, 11:32 | | IRA - Infrasors - Trading statement and update in respect of the 12 month period |
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IRA
IRA
IRA - Infrasors - Trading statement and update in respect of the 12 month period
ended 28 Feruary 2009
INFRASORS
(Incorporated in the Republic of South Africa)
(Registration number: 2007/002405/06)
Share Code on the JSE: IRA ISIN ZAE000101507
("Infrasors" or "the Group")
TRADING STATEMENT AND UPDATE IN RESPECT OF THE 12 MONTH PERIOD ENDED 28
FERUARY 2009
Infrasors shareholders are advised of the following:
- Infrasors expects its revenue to increase by 1.9%;
- Infrasors expects its gross profit to decrease by approximately 27.8%; and
- Infrasors expects its earnings before interest, tax and depreciation to
decrease by approximately 42.7% for the twelve month period ended 28 February
2009 compared to the previous corresponding period.
Trading statement
In terms of the JSE Listings Requirements, companies are required to publish a
trading statement as soon as they become reasonably certain that the financial
results for the period to be reported on next will differ by more than 20% from
those of the previous corresponding period.
Infrasors recognised in its earnings per share in 2008 an International
Financial Reporting Standards ("IFRS") adjusted profit being the purchase price
allocation excess over the net asset value acquired in the sum of R41,5 million
resulting in earnings per share of 74,5 cents. The F2008 headline earnings per
share (excluding the IFRS adjustment) was 44,6 cents per share.
Infrasors expects a decline in earnings per share for the twelve month period
ended 28 February 2009 of between 70% to 80% (including the F2008 IFRS
adjustment), and a decline in headline earnings per share for the twelve month
period ended 28 February 2009 of between 55% to 65% (which excludes the F2008
IFRS adjustment).
The principal reasons for the decline in earnings per share and headline
earnings per share compared to the previous corresponding period are as follows:
- Lyttelton Dolomite experienced a drop in demand for metallurgical dolomite
which was partly set off by an increase in demand for aggregate dolomite
products.
- Lyttelton Dolomite partially inoperable during the 2 months of November 2008
and January 2009 due to a labour dispute and strike, and a subsequent fly
rock blasting incident, all of which have been resolved successfully by
management.
- Delf experienced a softening in demand for certain products and reduced sales
in the foundries, leisure and building and construction industry sectors in
line with the global slowdown in industry.
- Infrabric experienced a slow-down in demand for bricks from the residential
construction sector and the RDP housing contractors and has consequently
reduced production to a single shift.
- Steep cost escalations in fuel, transport and labour had to be absorbed, hence
diminishing operating margins across the Group.
- The tax charge for the period ended 28 February 2009 includes a charge for
Secondary Tax on Companies in respect of dividends of 12 cents per share
declared in June 2008.
- The denominator used in calculating earnings per share in F2009 is fully
diluted and based on 172 985 000 shares in issue whilst the denominator used
in F2008 was the weighted average number of shares in issue of 138 649 000.
Trading update
Outlook for F2010
Infrasors` principal subsidiaries, Lyttelton Dolomite, Delf Sand and Infrabric
continue to be profitable, solvent, cash generative and fully operational. The
businesses are well managed, fully capitalized and financially healthy. The
Group balance sheet at 28 February 2009 reflects net assets in excess of 200
cents per share and is conservatively geared with a low level of borrowings.
Whilst demand for the Group`s products and services has fluctuated in certain
industries pursuant to the economic downturn, Infrasors` overall position as a
mining group and producer and supplier of base minerals and materials remains
essential to its customers and end users.
Lyttelton is currently operating at full capacity and has a healthy order book
into 2010 underpinned by construction activity leading up to the World Cup and
Government spend on infrastructural upgrades.
Delf is operating at approximately 65% capacity whilst the slow-down in foundry
activity, residential building and leisure continues. Delf continues to make a
concerted effort to expand its product offering into other industry sectors.
The financial information on which this trading statement is based has not been
reviewed or reported on by the Group`s auditors and the Group`s results for
F2009 are expected to be published on or about 25 May 2009.
Sandton
19 May 2009
Sponsor
Sasfin Capital Limited
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Date: 19/05/2009 11:32:01 Produced by the JSE SENS Department.
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