OMNIA HOLDINGS LIMITED - Trading statement and update on publication of the financial results for the year ended 31 March 2020

Trading statement and update on publication of the financial results for the year ended 31 March 2020

OMNIA HOLDINGS LIMITED
Incorporated in the Republic of South Africa
(Registration number 1967/003680/06)
JSE code: OMN
ISIN: ZAE000005153
(“Omnia” or the “Company” or the “Group”)

TRADING STATEMENT AND UPDATE ON PUBLICATION OF THE FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2020

Omnia is in the process of finalising its financial results for the year ended 31 March 2020. Paragraph 3.4 of
the JSE Limited Listings Requirements requires a company to publish a trading statement as soon as its Board
is satisfied that there is a reasonable degree of certainty that the financial results for a period to be reported on
will differ by more than 20% from that of the previous corresponding period.

Accordingly, a review by Omnia’s Board of the Group’s financial results for the year ended 31 March 2020
has indicated that:
    -    earnings per share is expected to increase by between 111% and 121%, from a loss per share of
         609 cents for the year ended 31 March 2019, to earnings per share of between 65 cents and 130 cents
         for the year ended 31 March 2020; and
    -    headline earnings per share is expected to increase by between 258% and 275%, from a headline loss
         per share of 112 cents for the year ended 31 March 2019, to headline earnings per share of between
         177 cents and 196 cents for the year ended 31 March 2020.

IAS33 – Earnings per share, requires that the calculation of basic and diluted earnings per share (and as a
consequence headline earnings per share) for all periods presented is adjusted retrospectively when the number
of ordinary or potential ordinary shares outstanding increases as a result of a capitalisation. Therefore, the
restated 31 March 2019 earnings per share and headline earnings per share, taking into account the impact of
the rights issue that occurred during the 2020 financial year, are as follows:

        31 March 2019                            As previously reported         Restated
        Loss per share (cents)                           (609)                     (530)
        Headline loss per share (cents)                  (112)                      (97)

Based on the 2019 restated loss per share and headline loss per share:
    -    earnings per share is expected to increase by between 112% and 125%, from a restated loss per share
         of 530 cents for the year ended 31 March 2019 to earnings per share of between 65 cents and 130 cents
         for the year ended 31 March 2020; and
    -    headline earnings per share is expected to increase by between 282% and 302%, from a restated loss
         per share of 97 cents for the year ended 31 March 2019, to headline earnings per share of between 177
         cents and 196 cents for the year ended 31 March 2020.

Trading Statement commentary
Omnia continues to implement its turnaround plan and restructuring processes. During the 2020 financial year,
this plan focused on creating a sustainable platform for growth whilst addressing cost reduction, effectively
managing working capital and ensuring a return on capital previously invested. Omnia’s prudent cash
management strategy and disciplined execution has strengthened its balance sheet and resulted in strong
earnings growth.

The company’s net debt position at 31 March 2020 was R1.3 billion (excluding the effects of IFRS16 adopted
since 1 April 2020 and R1.9 billion including IFRS16 impacts) compared to R4.4 billion in the prior year,
with undrawn finance facilities of R3.7 billion. All covenant requirements were comfortably met.

The COVID-19 pandemic has resulted in revised economic and industry forecasts accounting for the impact
on current operations, as well as the uncertainty relating to the trading conditions going forward. In particular,
the fuel sector in which Umongo Petroleum operates, has experienced increased volatility and risk, resulting
in unprecedented forecasting uncertainty. Consequently, a detailed reassessment of projected cashflows and
underlying key assumptions, resulted in an impairment of R105 million, despite the business generating
increased revenue over the past year. Omnia has confidence in the Umongo Petroleum management team and
believes that the business is well placed to respond effectively to market changes.

The Group’s results include the following items:
      -   Debt restructure costs of R24 million
      -   Retrenchment costs across the Group amounting to R22 million
      -   EcoGypsumTM closure costs of R6 million
      -   Gain on a legal settlement of R14 million

Further adjustments may have to be made as a result of the year end closures and COVID-19.

The contraction in the Zimbabwean economy continues, resulting in a rapid increase of the inflation rate and
a weakening Zimbabwean dollar, despite the establishment of an inter-bank foreign exchange market in
February 2019. Hyperinflation accounting according to IAS29 has been applied and as a result, a monetary
gain of R22 million was recognised.

The financial information on which this trading statement is based has not been reviewed by or reported on
by Omnia’s external auditors. Omnia’s results for the year ended 31 March 2020 may be impacted further by
adjustments resulting from the year-end closure process, including new COVID-19 related implications,
which may result in a change in the estimated EPS and HEPS noted above. A further trading statement in this
regard will be provided if necessary.

Extension of financial reporting period
Omnia intends to publish its financial results for the year ended 31 March 2020 on or about 7 July 2020. The
JSE has been notified of the short extension, which is in line with the market notice issued on 3 April 2020 by
the Financial Services Conduct Authority in respect of the extension of financial reporting periods due to the
constraints placed on companies as a consequence of the COVID-19 pandemic and resultant nationwide
lockdown.

Current trading
As the Group operates across a number of countries, Omnia’s response to COVID-19 has been guided firstly
by relevant national authorities, and secondly by international guidelines such as those issued by the World
Health Organization. As a responsible corporate citizen, Omnia continues to take extensive measures to ensure
the welfare of its people and partners across the world, while delivering essential services to its customers
during this difficult period. Omnia's internal policies and risk management practices are constantly reviewed
and updated to ensure that they continue to align to the rapidly evolving health and economic situations.

Since the start of the pandemic, Omnia has continued to deliver essential services, including primary chemicals
and solutions for the agriculture, mining, manufacturing and fuel sectors which play an essential role in food
security, economic stability and the livelihoods of people globally. The beginning of Omnia’s financial year
is traditionally a quieter time and a number of plants in South Africa have undergone planned maintenance
shutdowns over the past few weeks. The plants are now operational at the capacities required for the upcoming
planting season and the demands of the mining sector. All operations are working in line with lockdown
regulations and under strict conditions to minimise the potential for COVID-19 transmission.

Interest in Oro Agri
Oro Agri is an international AgriBio business acquired by Omnia in 2018. It is not a business that Omnia has
considered to be for sale. However, Omnia has received a non-binding indicative offer for Oro Agri that
deserves the Board’s consideration. An engagement process under an agreed exclusivity with the offeror is
currently underway. Shareholders will be advised if the engagement process progresses to the point of a
potential transaction that may have a material effect on the price of Omnia’s shares.


Johannesburg
22 June 2020


Sponsor
Java Capital
Date: 22-06-2020 07:05:00
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