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JD Group Limited - Upgraded ratings for JD Group from CA-Ratings JD GROUP LIMITED (Incorporated in the Republic of South Africa) (Registration Number 1981/009108/06) JSE code: JDG NSX code: JDL ISIN: ZAE000030771 (`JD Group`) UPGRADED RATINGS FOR JD GROUP FROM CA-RATINGS CA-Ratings announced today it has upgraded its ratings in both the short-term and long-term to JD Group Limited after a full interactive investigation based on the normal rating mandate. The ratings are on the national scale for South Africa, and are now `zaA` long-term (previously `zaA-` as announced in 2003) and `zaA1` short-term (previously `zaA2` as announced in 2003), with stable outlooks for the three-year time horizon. The category `zaA` indicates a `strong` long- term position in comparison with other South African obligors, while `zaA1` indicates a `very strong` short-term position. CA-Ratings commented as follows: `Compared with other companies listed on the JSE Securities Exchange, JD Group is viewed to occupy a position significantly above the median. This is even more noteworthy when considering that the furniture sector where JD Group is active carries an above-average industry risk. The ratings are assigned after taking this fully into account. The upgrades follow improvements in the strategic position of the group and a strengthened vision for the future, coupled with a more rounded product and service offering across many categories of the furniture retail segment. The strong ratings remain supported by the significant market share of the group. This is enhanced by an extremely experienced management team. In addition, the financial conservatism and astute handling of the financing aspect retain financial flexibility that is above the norm for retail groups. The strong financial systems also ensure a high level of efficiency. JD Group is expected to continue to benefit from the strong spending on semi- durable goods in South Africa and its strengths are viewed to be able to carry it through cyclical corrections from time to time. The ratings are designed to gauge corporate strength through the cycles, rather than fluctuate with them. The JD management remains experienced in extending credit to their customers and manage its debtors` book astutely and conservatively. In addition, lower inflation and interest rates have a positive effect on the credit market that has favourably impacted the debtors` book even further. Constraints on the rating are still stated to be the high level of competition remaining in the market, a relatively high-risk credit market and still maturing foreign operations as well as the continuing systems integration within the group.` ENDS Enquiries JD Group Ltd Jan Bezuidenhout 011 405 0205 CA-Ratings Charl Kocks 011 442 4230 College Hill 011 447 3030 Nicholas Williams Johannes van Niekerk Background note CA-Ratings is the sole wholly South African credit ratings agency. It has been operating in the South African and southern African markets since 1993, and is unashamedly committed to Africa. CA-Ratings applies the same criteria and the same methods as does the largest ratings agency in the world. Its ratings are assigned either on the South African national scale (running from zaD to zaAAA) or on the international scale (from D to AAA). The ratings of JD Group Limited have been requested on the national scale, which provides maximum value and usefulness to South African users since it offers the clearest differentiation against other South African issuers and corporate entities. The ratings assigned to JD Group Limited fully comply with the regulations to the CISCA Act, No 45 of 2002 (as do all ratings issued by CA-Ratings). CARatings is a ratings agency approved under that act. This means that investors falling under the Collective Investment Schemes Control Act (such as unit trusts)) may invest in debt instruments issued by JD Group Limited to a maximum extent of 10% of that investor`s portfolio if the debt is not a money market instrument, and to a maximum of 5% if the debt is a money market instrument. Date: 17/01/2005 01:53:09 PM Produced by the JSE SENS Department
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