| Thu 20 Oct 2005, 12:10 | | The Mr Price Group - Trading Statement |
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The Mr Price Group - Trading Statement
MR PRICE GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1933/004418/06)
ISIN: ZAE000026951
Share Code: MPC
("The Mr Price Group" or "the Group" or "the company")
TRADING STATEMENT
In terms of the Listings Requirements of the JSE Limited, companies are required
to publish a trading statement as soon as they are reasonably satisfied that the
financial results for the period to be reported upon next will differ by at
least 20% from the previous reporting period.
The Mr Price Group is currently finalising its results for the 26 weeks ended 24
September 2005 which should be released on 17 November 2005. These results are
being prepared in compliance with International Financial Reporting Standards
and Circular 7/2005 issued by the South African Institute of Chartered
Accountants on the accounting for operating leases (hereinafter jointly referred
to as IFRS). In this regard, shareholders are advised that fully diluted
earnings per share and headline earnings per share are likely to be 50% to 60%
higher than the corresponding reporting period of the previous half year.
The forecast financial information on which this trading statement is based has
not been reviewed and reported on by the company"s auditors.
Notes:
In the previous financial year the Group disposed of its interest in a
shopfitting subsidiary and during the current financial period, as previously
reported, the Hub and Galaxy Divisions have, subject to the fulfilment of
conditions precedent, been sold.
The following should be noted:
1.1. Basic earnings per share are negatively impacted by the losses on
discontinuance of the abovementioned operations and are positively affected
by the reversal, on discontinuance, of liabilities created on the
implementation of the straight line accounting policy for leases. These
amounts are reversed in arriving at headline earnings.
1.2. Earnings incorporate the results of the discontinued operations up until
the date of their discontinuance but, after the exclusion of these results,
the headline earnings of continuing operations are also expected to be 50%
to 60% higher than the corresponding period in the prior year.
2. In compliance with the international interpretation of IAS17 and Circular
7/2005 issued by the South African Institute of Chartered Accountants on
the accounting for operating leases, the Group is accounting for such
leases on a straight line basis over the term of the lease and not, as in
prior years, on the basis of the cash flows in terms of the lease
agreements. The estimated impact of this adjustment on the earnings and
headline earnings for the year ended 31 March 2005 is as follows:
Previously Restated Change %
stated
Earnings (Rm) 289,3 286,9 (0,8)
Headline earnings (Rm) 290,8 288,4 (0,8)
Earnings per share (cents) 119,8 118,8 (0,8)
Headline earnings per share 120,4 119,4 (0,8)
(cents)
Furthermore it is estimated that the opening retained income at 1 March
2004 will be restated by R56,9 million to reflect the cumulative impact at
that date.
3. Contributions to export partnerships, which are held to meet matching
deferred taxation commitments, are, as in prior years, being accounted for
as long term receivables and valued at their amortised cost using the
effective interest rate method. This accounting treatment appears to be
consistent with general reporting practice being applied in this country
but the Group is seeking confirmation from its auditors and other external
parties that the treatment is in compliance with IAS39.
Durban
20 October 2005
Merchant Bank and Sponsor
RAND MERCHANT BANK (A division of First-Rand Bank Limited)
Date: 20/10/2005 12:10:08 PM Produced by the JSE SENS Department
