| Thu 26 Aug 2010, 14:00 | | MPC - Mr Price Group - Trading update to 31 July 2010 and changes to the |
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MPC
MPC
MPC - Mr Price Group - Trading update to 31 July 2010 and changes to the
board
Mr Price Group Limited
Registration number 1933/004418/06
Incorporated in the Republic of South Africa
ISIN: ZAE 000026951
JSE share code: MPC
("Mr Price" or "the company" or "the group")
TRADING UPDATE TO 31 JULY 2010 AND CHANGES TO THE BOARD
Trading update
For the first four months of the financial year ending 31 March 2011 (18
weeks to 31 July 2010), Mr Price Group Limited reported total sales growth
of 11.9% and comparable sales growth of 8.6%. Inflation of 0.2% was
recorded and trading space increased by 2.0%. Cash sales constituted 82.1%
of total sales.
The Apparel Division, which represents 71.5% of group sales and which
comprises Mr Price, Mr Price Sport and Miladys, reported sales growth for
the period of 12.4% and comparable sales growth of 8.0%. Deflation of 1.2%
was recorded and trading space increased by 4.4%.
The Home Division, comprising Mr Price Home and Sheet Street recorded sales
growth of 10.9% and an increase in comparable sales of 10.3%. Inflation of
3.4% was recorded and trading space decreased by 1.7%.
As required by the JSE Limited Listing Requirements, a company is required
to announce once it is reasonably certain that its results will differ by
more than 20% over the corresponding reporting period. As a result of
continued market share gains, the recovery of the previously
underperforming divisions and the healthy state of the debtors book, the
company expects basic, headline and core headline earnings per share for
the six months ending 30 September 2010 to increase by more than 20% over
the comparable period. However, given the early stage in the interim
reporting period, the company cannot yet forecast with any degree of
certainty the results to 30 September 2010 and a further announcement will
be made once this is possible.
The above-mentioned figures and forecast financial information have not
been reviewed and reported on by the company`s auditors.
Changes to the board
Following approval at a board meeting held earlier today, Mr Price
announced several role changes in the group in terms of its long-term
succession plan. These changes are effective immediately.
Stuart Bird has been appointed Chief Executive Officer ("CEO"). Stuart was
Managing Director of the Mr Price Apparel chain for seven years during
which time he grew the chain`s sales from R1.6 billion to R4.5 billion and
significantly improved operating margins and market share.
He was appointed Deputy CEO in May 2009. Stuart is a CA (SA) and has been
with the group for 16 years.
Alastair McArthur, currently CEO and whose appointment as Executive Deputy
Chairman was announced in May 2009, has been appointed Executive Chairman
in line with the group`s stated policy of having a chairman with
substantial expertise in fashion-value retailing. Alastair has been with
the group for 18 years and for the past 13 years has been CEO. During his
tenure as CEO, group headline earnings per share have grown at a compound
annual rate of 24.3%.
Stewart Cohen and Laurie Chiappini, who are presently Joint Chairmen and
were founders of the Mr Price business, have been appointed Honorary
Chairmen. They will both remain non-executive directors of the company and
will continue to maintain their involvement and investment in Mr Price. As
part of the board succession plan, their family members, Neill Abrams and
Tracey Chiappini-Young have been appointed as their alternate directors.
Bobby Johnston will continue in his important governance role as Lead
Director and Chairman of the Remuneration and
Nominations Committee. Bobby Johnston said, "These appointments are part of
our plan to ensure orderly succession and continuity for the group. Stuart
Bird has been accountable for the day-to-day running of the business for
the past year and a half and Alastair McArthur has assumed a more strategic
executive role within the group similar to the past role of the Joint
Chairmen. Stewart and Laurie will continue to maintain their involvement
and financial interest in the business while at the same time providing for
future family representation at board level. I believe that Tracey and
Neill have the right qualifications and experience to add value to the
group in the future and their CV`s are available on our website."
"This is not a sudden change" said Mr Johnston. "It is something we have
been planning and gradually implementing for some time. The board will
also ensure that proper governance principles will apply in the
relationship between the incoming CEO, the new Chairman and the Lead
Director. That relationship has worked extremely well over the past 18
months and the board is satisfied with the timing of the appointments."
In order to reduce the size of the board while still complying with King 3
and the new Companies Act, certain other changes were announced. Chris
Yuill and Shane van Niekerk, who have been with the group for 32 years and
27 years respectively, have retired from the board with immediate effect.
Chris served as Group Financial Director and more recently as Group
Secretary, in which capacity he will continue to share his skills and
knowledge. Shane held the positions of Managing Director of Mr Price
Apparel, Joint Group Managing Director and Chief Operations Officer prior
to deciding to take early retirement. Steve Ellis and Prof. Larry Ring, who
are currently on the board, have been appointed alternate directors. As a
consequence of these changes, the board will now comprise 13 directors of
whom 10 will be non-executive, with 7 of those being independent non-
executive directors.
Durban
26 August 2010
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 26/08/2010 14:00:01 Produced by the JSE SENS Department.
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