A G Industries Limited - Trading Update
A G INDUSTRIES LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1980/004051/06
Share Code: AGI
ISIN: ZAE000039467
(`The Company`or `the Group`)
TRADING UPDATE
Shareholders are advised that the results likely to be achieved by the Company
for the year ended 30 June 2004 will be substantially higher than those achieved
for the previous year. The following is an update on trading conditions for the
year ended 30 June 2004.
Domestic
The domestic operations continued to perform very well, both in the Glass and in
the Aluminium Divisions. Although lower selling prices, attributable to the
strength of the Rand, resulted in lower rand contributions to profit, the
domestic margins remained stable and demand for the products remained buoyant.
As mentioned at the interim stage the Group embarked on a cost reduction program
in October 2003. This program has been successfully completed and has resulted
in considerable cost savings and efficiencies which will positively impact the
Group`s profitability in the year ahead. Going forward the Group will encourage
a culture focused on cost savings, efficiencies, quality and service through
incentivisation programmes and thus further enhance operating margins and
profitability. Improved control over working capital, positive cash flows and
reduced borrowing rates resulted in lower finance charges which further enhanced
profitability.
International
The average Rand/Dollar exchange rate appreciated by 24% when compared with the
previous financial year resulting in a fall in hard currency revenues, lower
gross margins and a reduction in volumes of commodity and component exports. The
German economy remained depressed resulting in further pressure on volumes and
margins while the U.K. business performed to expectations. In the U.S.A. the new
management team has successfully completed the restructure of the operations and
has made progress on building relationships with both suppliers and customers.
An improvement in operating margins was achieved when compared to the previous
year.
Conclusion
Full details of the Company`s operations and it`s prospects for the 2005
financial year will be provided with the announcement of the reviewed results
for the year ended 30 June 2004 which will be published on or about 14 September
2004.
3 August 2004
Johannesburg
Sponsor: HSBC Investment Services
Date: 04/08/2004 05:05:07 PM Produced by the JSE SENS Department
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