| Tue 3 Nov 2009, 9:01 | | ILV - Illovo Sugar Limited - Trading Statement |
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ILV
ILV
ILV - Illovo Sugar Limited - Trading Statement
ILLOVO SUGAR LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1906/000622/06)
Share Code: ILV
ISIN: ZAE000083846
("Illovo" or "the company")
TRADING STATEMENT
This statement is issued in compliance with the Listings Requirements
(Section 3.4(b)) of the JSE Limited.
In terms of established practice, Illovo issues financial statements for
the first six months of its financial year which reflect both actual
results based on International Financial Reporting Standards and, because
the sugar industry is a seasonal agriculturally-based business, results
which are determined on a sugar season basis. It is the directors`
opinion that the results for the first half of the financial year,
determined on a sugar season basis, provide a better basis for evaluating
the financial performance of the company, noting that for the full year
there is no difference between actual results and those determined on a
sugar season basis.
Illovo`s results are generally impacted by production volumes, domestic
market sales, the level of the rand compared to other currencies, and by
the world price of sugar.
Actual results for the six months ended 30 September 2009, compared to
the corresponding period last year, will particularly reflect the
positive impact of improved world market sugar prices in South Africa,
increased sugar production in Zambia following the commissioning of the
major expansion at Nakambala, and increased sugar production and
favourable sugar sales pricing in Tanzania. Accordingly, operating
profits for the period are anticipated to increase by around 35%, whilst
actual headline earnings per share ("heps") and earnings per share
("eps") for the first six months of the current financial year are
expected to be between 25% and 30% higher than those of the corresponding
period last year.
However, for the first six months of the financial year, determined on a
sugar season basis, heps and eps are expected to be similar to those of
the comparative period of the previous year. This is due to the value of
the rand, which is currently projected to remain significantly stronger
for the remainder of the current year compared to the second half of the
previous financial year. This will impact negatively on foreign currency
denominated export revenue in respect of both sugar and downstream
products, as well as the conversion of foreign subsidiary company profits
into rands, for the season as a whole.
Operating profits for the full year ending 31 March 2010 are expected to
be between 10% and 20 % higher than those of the previous year. Group
financing costs for the year will reduce following the receipt of rights
issue proceeds in September 2009, but as a result of taxation normalising
at around 30%, headline earnings are anticipated to be similar to those
of the previous year. The higher weighted average number of shares in
issue after the rights issue, which provided for the issue of 30.83 new
shares for every 100 existing Illovo shares, is expected to dilute heps
and eps for the full year by between 10% and 20% compared to the previous
financial year.
The forecast financial information on which this trading statement is
based has not been reviewed or reported upon by the company`s auditors.
The company`s Interim Report for the six months ended 30 September 2009
is due to be released on 19 November 2009.
Mount Edgecombe
3 November 2009
Sponsor
JP Morgan Equities Limited
Date: 03/11/2009 09:01:07 Produced by the JSE SENS Department.
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