| Mon 28 Feb 2011, 13:50 | | CMP - Cipla Medpro South Africa Limited - Trading statement and clarification of |
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CMP
CMP
CMP - Cipla Medpro South Africa Limited - Trading statement and clarification of
results
CIPLA MEDPRO SOUTH AFRICA LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2002/018027/06)
(ISIN Number: ZAE000128179 Share Code: CMP)
("Cipla Medpro" or "the Company")
TRADING STATEMENT AND CLARIFICATION OF RESULTS
In terms of the JSE Limited Listings Requirements, companies are required to
publish a trading statement as soon as they are reasonably certain that the
financial results for the current reporting period will be more than 20%
different from those of the previous corresponding period.
Shareholders are advised that the Company expects earnings per share ("EPS") and
headline earnings per share ("HEPS") for the twelve months ended 31 December
2010 to be between 18% and 23% higher than the EPS and HEPS for the prior
corresponding period. On a normalised basis, after adjusting for the fair value
of interest rate swaps, interest rate swap settlements and the foreign exchange
contract ("FEC") losses, normalised earnings per share will increase between 22%
and 32%.
These 2010 annual results have been achieved despite significant non-cash IFRS
adjustments with regard to FECs. As a result of the strong Rand / weak US Dollar
on 31 December 2010, an unrealised loss on FECs of R44,7 million was debited to
the income statement (due to the mark to market revaluation required) despite a
gain being recorded in the accounts at 30 June 2010 of R22,4 million and an
unrealised loss of R24,7 million at 31 December 2009. Although this has resulted
in a significant non-cash adjustment to the income statement, we have enjoyed
the benefit of the stronger Rand throughout the year, and this can be seen in
our gross profit margin which has increased significantly from 49.2% at 31
December 2009 to more than 58% at the end of 2010. To illustrate the
significance that the strong Rand / weak US Dollar had on the results, which was
at its lowest level in about seven years, we have re-valued the FECs using the
spot rate at the end of January 2011 which was R7.20. At this rate the loss of
R44,7 million would have reversed completely.
In addition, these adjustments do not affect the Company`s ability to generate
cash and after paying its inaugural dividend in the second half of 2010 which
amounted to R22,5 million, the Company generated in excess of R130,0 million
cash in the 2010 financial year, compared to R10,2 million in 2009.
The information in this trading statement has not been reviewed or reported on
by Cipla Medpro`s auditors. The Company`s results for the twelve months ended
31 December 2010 are expected to be published on or about 17 March 2011.
28 February 2011
Investment Bank and Sponsor
Nedbank Capital
Date: 28/02/2011 13:50:01 Produced by the JSE SENS Department.
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