| Mon 18 Jan 2010, 16:58 | | AVI - AVI Limited - Trading Update and Statement for the Six Months Ending |
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AVI
AVI
AVI - AVI Limited - Trading Update and Statement for the Six Months Ending
31 December 2009
AVI Limited
(Registration number 1944/017201/06)
Share code: AVI
ISIN: ZAE000049433
("AVI" or "the Group")
TRADING UPDATE AND STATEMENT FOR THE SIX MONTHS ENDING 31 DECEMBER 2009
The following update is based on the latest available trading information for
the six months ended December 2009 and covers performance for the Group`s
continuing operations.
Segmental revenue for continuing operations for the six months ended 31 December
2009
Revenue 2009 2008 Change
Rm Rm %
Entyce beverages 1,179 1,107 6.5
Snackworks 1,136 1,143 -0.1
Chilled & frozen 847 970 -12.7
convenience brands*
Fashion brands - personal 418 378 10.6
care
Fashion brands - footwear 464 400 16.0
& apparel
Corporate 4 5
GROUP 4,047 4,003 1.1
* = excludes Alpesca
Group revenue for the six months to December 2009 was similar to the comparable
period in the prior year. Irvin and Johnson Holding Company (Proprietary)
Limited`s ("I&J") revenue was 17.1% lower due to a combination of reduced export
selling prices and a stronger Rand. Demand for the Group`s other food and
beverage brands was satisfactory in the context of constrained consumer
spending. In some categories revenue growth was muted by tactical price
reductions implemented during the second half of the last financial year to
support volumes.
AVI`s personal care, footwear and apparel brands performed well, benefiting from
price increases implemented in the second half of the last financial year as
well as volume growth.
The consolidated gross margin to the end of December 2009 was slightly higher
than the first half of last year with the benefit of softer commodity prices in
some categories but partially offset by lower realised selling prices in I&J and
the tactical price reductions referred to above. Selling and administration
costs have been well controlled and operating profit margin is in line with that
achieved in the same period last year.
Lower average debt levels during the period, combined with lower interest rates,
have resulted in a material decrease in net finance charges compared to the same
period in the prior year.
Capital items
Results for the first half of the prior year included a R26.4 million profit on
the sale of an I&J property and a R23.6 million profit on the disposal of a non-
core subsidiary that packed private label teas and coffees. There have been no
disposals of material assets during the current period and consequently capital
profits are expected to be negligible.
The following statement is made in accordance with Section 3.4 (b) of the
Listings Requirements of the JSE Limited:
Consolidated headline earnings per share for the continuing operations of the
Group for the six months ending 31 December 2009 are expected to increase by
between 5% and 10% over the comparable period in the prior year;
Consolidated earnings per share for the continuing operations of the Group for
the six months ending 31 December 2009, including net capital gains on the
disposal of assets, are expected to reflect a reduction of between 5% and 10%
over the comparable period in the prior year.
Discontinued operations
The Board remains committed to disinvesting from the Argentinean hake and shrimp
operations conducted by Alpesca s.a. ("Alpesca"), a wholly owned subsidiary of
I&J. The recent implementation of a transferable quota system in Argentina,
which enhances long term quota security and allows quota to be transferred
separately from vessels, is a positive development which should improve value
for prospective buyers. Alpesca`s hake operation has been materially impacted by
lower selling prices into export markets and is expected to make an operating
loss for the first half.
AVI anticipates the release of its interim results for the six months ending 31
December 2009 on 8 March 2010.
The information above has not been reviewed and reported on by the Group`s
auditors.
Illovo
18 January 2010
Sponsor
Standard Bank
Enquiries
Simon Crutchley Tel: +(27) 11 502 1300
Chief executive officer
Owen Cressey Tel: +(27) 11 502 1300
Chief financial officer
Date: 18/01/2010 16:58:01 Produced by the JSE SENS Department.
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