| Wed 19 Feb 2003, 17:51 | | TRADEHOLD REGROUPS AFTER EVENTFUL SIX MONTHS |
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Tradehold Limited
ISIN: ZAE000026902
Share code: TDH
Tradehold has reported an operating loss of GBP1,36m for the eventful six months
to end December 2002 which saw it placing two of its businesses in the UK under
administration, the retail chains What Everyone Wants (WEW) and The Famous
Brunswick Warehouse (TFBW).
The company generated turnover for the period of GBP236,41m (2001: GBP262,49m).
Continuing operations contributed GBP184,89m while posting an operating profit
of GBP12,54m. However, its discontinued operations recorded an operating loss of
GBP13,89m.
After taxation, outside shareholders` interest and exceptional items of
GBP12,19m Tradehold ended the period with a net loss of GBP10,92m as against a
profit of GBP6,19m in the corresponding period. The exceptional items relate
mainly to the cost of winding down WEW and TFBW.
Tradehold`s continuing operations are largely represented by its 54% holding in
the LSE listed Brown & Jackson which owns the 338-store retail chain
Poundstretcher. The latter is presently being remodelled extensively by a new
top management team of experienced British retailers under MD Angus Monro, a
highly respected figure in UK retailing.
Brown & Jackson was restructured in September last year when it sold off its
three ailing retail chains - in addition to WEW and TFBW, also Your More Store -
16 stores in Poland and a property portfolio valued at GBP34,4m to Tradegro, a
wholly-owned subsidiary of Tradehold. The poor performance of these loss-making
chains was impacting negatively on Brown & Jackson`s market rating while also
taking up an inordinate amount of group management`s time in trying to restore
them to profitability.
At Tradegro efforts to turn around the three businesses continued. Only the
prognosis for Your More Store was positive. On 9 December a court order was
obtained to place WEW and TFBW under administration after the directors of the
two companies decided they could not justify the substantial additional capital
required for the full recovery of these businesses.
Since the restructuring of Brown & Jackson in September much has been done to
improve the profitability of the Poundstretcher chain. It generated a profit of
GBP11,64m for the six months despite increasing sales by only 2,7% and like-for-
like sales by 0,8%.
Moreover, the impact of the remodelling of the business was felt more and more
towards the end of the review period as new merchandise ranges gained increasing
support from consumers. In the first seven weeks of the new reporting period,
total sales jumped 15% while like-for-like sales stood 13% higher. However,
Poundstretcher management cautioned that this growth rate would in time slow
down.
In addition, at the end of the review period stock levels were 30% lower than
the previous year, margins were in line with expectations and the business had
no debt.
Tradehold chairman Christo Wiese said Tradehold had successfully weathered an
extremely difficult time and that operations were starting to get back on track.
"I believe there is sufficient reason for optimism concerning the future of the
business," he said.
Ends
ISSUED BY De Kock Communications (DKC)
ON BEHALF OF Tradehold
DATE ISSUED Wednesday, 19 February 2003
MEDIA ENQUIRIES Cornus Moore, CEO Tradehold cell 0941 41 792 144585
Ben de Kock, DKC (021) 422 2690
Date: 19/02/2003 05:10:03 PM Supplied by www.sharenet.co.za
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