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CSL
CSL
Consol Limited - Trading Update
CONSOL LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1946/021828/06
Share code: CSL
ISIN: ZAE000063251
("Consol" or "the Group")
TRADING UPDATE
Consol is releasing the following statement for the eleven months ended 31 May
2006 ("the period") prior to the commencement of its "closed period" on 22 June
2006. The "closed period" will end with the release of Consol"s final results
for the year ending 30 June 2006, which are expected to be issued on or about 7
September 2006.
Consumer demand within key market segments was good contributing to growth in
Group volume of 10.1% and Group revenue of 10.5% as compared to the prior
period.
SEGMENTAL REVENUE FOR THE ELEVEN MONTHS ENDED 31 MAY 2006
Rm % change
Glass 2 028 12.9
Plastics 224 (7.3)
The glass division, which on a revenue basis accounts for 90% of the Group"s
activities, reflected strong growth with sales volumes 10.8% above the prior
period. Revenue grew by 12.9% with product mix changes partially limiting the
impact of selling price increases.
The plastics division sales performance declined compared to the prior period
with revenue down by 7.3%. In general this segment continued to be affected by
lower sales volumes due to increased competitor activity.
OPERATING RESULTS
The Board of directors of Consol ("the board") has resolved that it is
appropriate to provide relevant information on the operating results of the
Group"s operations in addition to the guidance required in terms of the Listings
Requirements of the JSE Limited.
Operating profit for the period at Consol Speciality Glass, a wholly owned
subsidiary, was negatively impacted by a predominantly strong rand affecting
selling price realisation for tableware which competes directly with imports and
adverse production output primarily as a result of initial commissioning
problems experienced with the pressware plant.
In addition, whilst trading conditions and demand in the glass division has been
good; operating profit growth during the period was constrained as a result of
higher than expected input costs in particular soda ash, energy, and
distribution. These unanticipated cost increases have not been recovered from
the market and thus lag selling price adjustments. Consequently the board
advises shareholders that consolidated headline earnings per share of Consol for
the twelve months ending 30 June 2006 are expected to be between 0% and 5% above
the 109.7 cents per share achieved in the prior year.
The information above has not been reviewed and reported on by the Group"s
auditors.
CORPORATE ACTIVITY
As previously announced the company disposed of the flexible plastic operation
(Flexibles) effective 28 April 2006. An agreement has also been reached on the
15 June 2006 to dispose of the thermo-forming rigid plastic business (Plastform)
subject to the approval of the Competitions Commission. These disposals follow
Consol"s strategic review that the Flexibles and Plastform operations did not
meet the investment criteria of the Group.
Wadeville
19 June 2006
Sponsor
Standard Bank
Enquiries:
Consol
Mike Arnold, Group Managing Director
Tel: +27 11 874 2228
Cell: +27 83 270 9483
Karuna Nayager, Group Financial Director
Tel: +27 11 874 2272
Cell: +27 83 500 9808
College Hill
Johannes van Niekerk
Tel: +27 11 447 3030
Cell: +27 82 921 9110
Date: 19/06/2006 04:45:04 PM Produced by the JSE SENS Department
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