Cashbuild Limited - Cashbuild 3rd Quarter Operational Update
Cashbuild Limited
Registration number: 1986/001503/06
(Incorporated in the Republic of South Africa)
Share Code: CSB
ISIN Code: ZAE000028320
CASHBUILD 3RD QUARTER OPERATIONAL UPDATE
In line with its commitment to full and timeous disclosure, Cashbuild provides,
for the first time to shareholders, an update on its trading performance for the
third quarter ended March 2004. It is the intention of management to provide
quarterly updates for the foreseeable future.
Cashbuilds trading results continue to show satisfactory growth, with year-on-
year growth in turnover of 17.5% being achieved in the 3rd quarter, thus
building on Cashbuilds 16% improvement in the first half of the year. Of
particular significance is the fact that growth continued to be achieved both in
the existing stores (up 9.3%), with new stores contributing 8.2%. These
improvements were supported by the continued favourable macro-economic
environment and the property culture arising from government drives to increase
home ownership and private homeowners striving for larger and better housing.
The deflationary environment experienced in the first half of the year continued
to play a role in the 3rd quarter. This environment has continued to adversely
impact percentage margins as Cashbuild maintained lower selling prices on stock
purchased at pre-deflationary prices. This strategy of lower selling prices
continues to bear fruit with growth in unit sales, number of customers shopping
at Cashbuild and market share, and from growing rand margins over the quarter.
The number of customers shopping at Cashbuild stores rose by 22% in the quarter,
achieved through growth in existing stores of 10.4% and an 11.6% contribution
from new stores. The deflationary environment has abated in the 4th quarter with
steel and timber price increases leading the way.
Recent weakness in the Botswana Pula, particularly with the 8% devaluation of
the currency by the government in February 2004, negatively impacted on the
results of Cashbuilds Botswana subsidiary.
Operating costs remain well managed and controlled.
Interest income from excess cash held in the business continues to be adversely
affected by lower interest rates. The company will continue to utilise its
excess cash for expansion, refurbishments, relocations and dividend flows.
Cashbuilds balance sheet remains solid with working capital well managed.
Cashbuild continues to expand conservatively, with two new stores opened during
the third quarter and one existing store refurbished. This is in addition to the
six new stores and two refurbished stores already completed in the first half.
Johannesburg
04 May 2004
Sponsor
Nedbank Capital
Date: 04/05/2004 12:00:04 PM Produced by the JSE SENS Department
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