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ECO
ECO
ECO - Edcon - Trading Update
Edgars Consolidated Stores Limited
(Reg. No. 1946/022751/06)
(Incorporated in the Republic of South Africa)
ISIN: ZAE000068649
Share Codes
JSE: ECO
NSX: ECN
("Edcon")
TRADING UPDATE FOR THE QUARTER ENDED DECEMBER 2006 AND RENEWAL OF CAUTIONARY
ANNOUNCEMENT
The retail sector continued to benefit from strong consumer confidence and
spending remained buoyant during the period, despite the tightening interest
rate environment.
Against this background, Edcon sales grew by 12% for the quarter, when compared
with the same 13 weeks last year. This follows the 21% growth reported for the
corresponding period last year. The sales increase for the month of December
was 14%.
By chain, sales growth and selling price inflation rates were as follows:
Sales Average
increase selling price
inflation
% %
Edgars 15 3
CNA 23 9
Department Stores Division 16 3
Discount Division 8 (1)
Edcon Group 12 2
In Edgars and CNA, gross profit growth was ahead of the respective sales
increases. The Discount Division was impacted by stock imbalances and
assortment problems and gross profit grew at a slower rate than sales.
Pleasingly, the Group`s moving annual stockturn was unchanged from that achieved
last year at 6,0 times. These results were achieved with 12% more average
retail trading space for the Group.
It was particularly encouraging that the growth in debtors` collections was
ahead of sales growth. At the December 2006 billing date, as anticipated, 86%
of the debtors` book was current and able to buy, compared with 87% in December
2005.
In October 2006 the Board issued a cautionary announcement advising that it had
commenced discussions with a number of private equity investors regarding a
potential transaction to acquire the Company.
Shareholders are advised that these discussions are ongoing and that they must
continue to exercise caution in their dealings with the Company`s securities.
The Edcon Board believes that the prospects provided in our September 2006
interim results announcement remain appropriate for the full year to March 2007,
namely that the "achievements of the first six months will continue for the
remainder of the current financial year".
This update has not been reviewed and reported on by Edcon`s external auditors.
Johannesburg
10 January 2007
Sponsor:
Merrill Lynch South Africa (Pty) Ltd
Namibian Sponsor:
Irwin Jacobs Greene (Pty) Limited
Date: 10/01/2007 17:10:01 Produced by the JSE SENS Department.
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