Truworths International Limited
SHARE CODE : TRU
ISIN CODE : ZAE000028296
TRADING
Truworths International Limited ("Truworths') increased retail sales in the
17 weeks to 21 October 2001 by 18.6% over the corresponding period for 2000.
While the positive trend in sales has continued since the announcement of
the company's year-end results in August, we have noted a slowdown over the
last few weeks. Notwithstanding this trend, retail sales in the trading
month of October increased 18.3% and we are also planning for a reasonable
growth in Christmas sales. The business remains focused and continues to
improve, with development and refinement of retail formats, sensible
expansion of the store network and tight management of costs progressing
according to plan. Our outlook, while positive, is tempered by a regard for
the impact of the slowdown in major economies and the recent events in the
United States. Overall, we believe our retail formula is sound and capable
of achieving further market share gains.
LEASE TERMINATION
The lease in respect of SRG House, our head office building located in Cape
Town, was terminated on 1 October 2001. As indicated in our annual results
announcement and annual report, the terms of the lease were considered
unfavourable given current and predicted market parameters and a new
arrangement regarding SRG House was necessary.
The termination, effected by a lump sum payment of R133.9 million, will
realise significant shareholder value. A net present value benefit of more
than R43 million, relative to the discounted future lease payments under the
lease, results from this payment. The payment will be capitalised and
amortised over the next 14 years.
TAXATION
The formal objections to revised assessments by the South African Revenue
Service (SARS), in relation to loans allegedly made on a non-arm's length
basis to offshore subsidiaries, in the 1996 to 1999 years were lodged with
SARS on 28 September 2001. An amount of R18,7 million, which is higher
than the R15,3 million additional liability referred to in our annual
results announcement because interest has been included, was paid to SARS
on the same date.
INTERIM RESULTS
Truworths interim results for the 26-week period to 31 December 2001 are
expected to be announced on 21 February 2002.
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