| Thu 21 Nov 2019, 7:06 | | MR PRICE GROUP LIMITED - MRP : Unaudited interim group results for the 26 weeks ended 28 September 2019 and cash dividend declaration |
|
MRP : Unaudited interim group results for the 26 weeks ended 28 September 2019 and cash dividend declaration: https://senspdf.jse.co.za/documents/2019/jse/isse/mrpe/21112019.pdf
Unaudited interim group results for the 26 weeks ended 28 September 2019 and cash dividend declaration
MR PRICE GROUP LIMITED
Registration number 1933/004418/06
Incorporated in the Republic of South Africa
ISIN: ZAE 000200457
JSE and A2X share code: MRP
("Mr Price" or "the company" or "the group")
UNAUDITED INTERIM GROUP RESULTS FOR THE 26 WEEKS ENDED 28 SEPTEMBER 2019 AND CASH DIVIDEND DECLARATION
This short-form announcement is the responsibility of the Mr Price Group Limited board of directors and is a summary of the information in the detailed results announcement available on:
https://senspdf.jse.co.za/documents/2019/JSE/ISSE/MRPE/21112019.pdf and https://www.mrpricegroup.com and does not contain full or complete details. These documents and the results presentation to the investment community are available on the group's website at www.mrpricegroup.com and copies may be requested from the company secretary (jcheadle@mrpg.com or +27 31 310 8000) at the company's registe
PRESS RELEASE
MR PRICE GROUP LIMITED REPORTS INTERIM RESULTS FOR THE 26 WEEKS ENDED 28 SEPTEMBER 2019
(Durban, 21 November 2019) Mr Price today released its interim results for the 26 weeks ended 28 September 2019. Normalised diluted headline earnings per share (based on the previous IAS 17 basis for accounting for leases) declined 7.2% to 447.5c. After accounting for leases on the new IFRS 16 basis, which did not require a restatement of comparative results, statutory diluted HEPS was 9.6% lower
The group's Australian operations have been presented as discontinued operations post trade ceasing on 30 April 2019 and the commentary below refers to the group's continuing operations.
Shareholders were advised at the presentation of the annual results in May and in the 18-week trading update issued in August, that group results for the first half would be impacted by the under-performance in the Mr Price Apparel division. This is reflected in the results below. Despite this, five of the group's trading divisions grew sales, gross margins and operating profits, with three increa
Total revenue grew 2.6% to R10.8bn. Retail sales grew 1.7% (comparable stores -1.5%) to R9.9bn. Excluding Mr Price Apparel, revenue and retail sales grew 7.3% and 6.1% respectively. Group store sales were up 1.3% and online 28.3%. Retail selling price inflation was 2.2% and 99.4m units were sold, a decline of 0.6%. By opening 27 new stores and expanding 8, weighted average new space grew 3.9%. Aft
The group's GP% contracted 260 bps to 40.0%, but grew by 20 bps excluding Mr Price Apparel. Selling and administration expenses declined 5.0%, impacted by the transition to IFRS 16. Including lease liability interest in expenses, total overheads increased 2.5% on last year. Excluding the impact of the new accounting statement completely, 'normalised' overheads only increased by 1.0%. Profit from o
The Apparel segment increased RSOI by 1.0% to R7.4bn. Operating profit declined by 13.6% with operating margin reducing 240 bps to 14.6%. Miladys delivered strong sales growth of 8.1% (comparable 3.3%) and gained market share in 5 out of 6 months per RLC data. Mr Price Sport delivered an outstanding performance, growing sales by 12.2% (comparable 6.1%), with online sales growing at 34.9%. Miladys
Sales in Mr Price Apparel declined 1.3% (comparable -4.3%) to R5.8bn. The issues causing the imbalance in the shape of the assortment in the second half of the prior financial period continued into the first half of FY2020, resulting in excess stock which required markdowns to clear. In contrast, online sales grew by 19.7%, highlighting the impact of an imbalanced assortment on the physical store
The Home segment increased RSOI by 4.1% to R2.5bn. Operating profit grew 17.8% and the operating margin increased. Both divisions reported a solid performance despite household discretionary spend declining, as consumers respond to value in this climate. Sales in Mr Price Home were up 3.2% (comparable 1.8%) with online sales increasing 36.0%. Sheet Street grew sales by 5.0% (comparable 2.5%).
The Financial Services & Cellular segment reported revenue growth of 10.3% to R743m and an operating profit growth of 20.7%. Financial services grew revenue 2.2% to R385m (interest and charges +5.9%, insurance -4.8%), while cellular and mobile revenue grew 20.7% to R358m. Cellular products are now sold through a call centre and 242 store kiosks across the group, with further rollout planned.
Retail sales outside of South Africa, which constitute 7.9% of group sales, declined by 2.2%, partly explained by the performance of Mr Price Apparel (which constitutes 69.7% of non-South African sales) and struggling economies. The group has elected to focus on areas of significant potential and accordingly exited Australia. Likewise, the Mr Price Home Polish test store will be closed in December
Net asset value per share increased 10.3% to 3 273c from September 2018. Capital expenditure of R231m was incurred, primarily in store development activities. Inventory levels were up 14.9%, with markdown units as a percentage of total units lower than the prior period and a good stock freshness ratio. The debtors book remains well managed, with a retail net bad debt to book ratio of 7.2% matched
The group has concluded its internal investigation into the suspected non-compliance with its Code of Conduct as advised in the SENS announcements of 12 September and 19 September 2019. The group's previously expressed views on materiality have not changed, and appropriate action has been taken in support of its zero-tolerance policy to such matters.
A short-term recovery in the consumer environment seems unlikely. Meaningful GDP growth will only return when broad-based structural economic reforms gain traction. The group is focused on winning market share, particularly in Mr Price Apparel. A shift in momentum was seen in the last two months of H1 FY2020, with the group's retail sales growth outperforming Type D retailers in both August and Se
ENDS
Contact
Group Head of Investor Relations
Matt Warriner
Mr Price Group Ltd
MWarriner@mrpg.com
+27 31 334 1652
INTERIM CASH DIVIDEND DECLARATION
Notice is hereby given that an interim gross cash dividend has been maintained at 311.4 cents per share for the 26 weeks ended 28 September 2019. As the dividend has been declared from income reserves, shareholders, unless exempt or who qualify for a reduced withholding tax rate, will receive a net dividend of 249.12 cents per share. The dividend withholding tax rate is 20%.
The issued share capital at the declaration date is 257 045 727 listed ordinary and 7 895 234 unlisted B ordinary shares. The tax reference number is 9285/130/20/0.
The salient dates for the dividend will be as follows:
Last date to trade 'cum' the dividend Tuesday 10 Dec 2019
Date trading commences 'ex' the dividend Wednesday 11 Dec 2019
Record date Friday 13 Dec 2019
Payment date Tuesday 17 Dec 2019
Shareholders may not dematerialise or rematerialise their share certificates between Wednesday, 11 December 2019 and Friday, 13 December 2019, both dates inclusive.
The dividend was approved by the Board in Durban.
DIRECTORS
SB Cohen* (Honorary Chairman), NG Payne* (Chairman), MM Blair (CEO),
MJ Stirton (CFO), N Abrams*^, MJ Bowman*, M Chauke*, SA Ellis^,
K Getz*, MR Johnston*, RM Motanyane-Welch*, D Naidoo*, B Niehaus*
* Non-executive director ^ Alternate director
Durban
21 November 2019
Sponsor:
Rand Merchant Bank (a division of FirstRand Bank Limited)
Date: 21/11/2019 07:05:00
Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
