HUGE GROUP LIMITED - Trading statement

Trading statement

HUGE GROUP LIMITED
(Registration number 2006/023587/06)
Share code: HUG       ISIN: ZAE000102042
(“Huge” or “Huge Group” or “the Company”)




TRADING STATEMENT

In terms of paragraph 3.4(b) of the JSE Listings Requirements, companies are required
to publish a trading statement as soon as a reasonable degree of certainty exists that
the financial results to be reported upon next, being the financial results for the six
months ended 31 August 2020 (HY2021), will differ by at least 20% from the financial
results for the corresponding period in the prior year, being the financial results for the
six months ended 31 August 2019 (HY2020 or the comparative period).

Huge is in the process of preparing its financial results for six months ended 31 August
2020.

The board of directors of Huge has decided that it will report normalised earnings per
shares (Normalised EPS) and normalised headline earnings per share (Normalised HEPS)
in addition to earnings per share (EPS) and headline earnings per share (HEPS).

Normalised EPS and Normalised HEPS take into account adjustments made to financial
performance to remove the effects of revenue and/or expenses that are unusual or
are once-off in nature in order for stakeholders to understand the Company's earnings
from its normal operations.

On 26 February 2020, shareholders of the Company overwhelmingly approved the
granting of options to the Chief Executive Officer, the Chief Operating Officer, and the
Chief Financial Officer. IFRS requires the Company to create a share-based payment
equity reserve equal to the independent calculation of the value of the options and to
do so by generating non-cash charges in the income statement. An independent
valuer determined that the value of the options is R42 million and the Company will
create a share-based payment reserve of this amount by charging the Company’s
income statements over time. This period’s charge amounts to R24.1 million, leaving
R17.9 million to be charged to future income statements (R10.5 million in the next 6
months and another R7.4 million in FY2022). These charges are non-cash charges that
have no effect on overall equity. As a result of this accounting, Huge has decided to
introduce the additional measures of Normalised EPS and Normalised HEPS based.

Shareholders are accordingly advised that a reasonable degree of certainty exists that
Huge’s:

•   Normalised EPS for the current period will be between 20.60 cents and 25.02 cents,
    which will be between 15% and 30% lower than the comparative period (HY2020:
    29.43 cents);
•   Normalised HEPS for the current period will be between 20.45 cents and 24.83
    cents, which will be between 15% and 30% lower than the comparative period
    (HY2020: 29.21 cents);
•   EPS for the current period will be between 5.89 cents and 10.30 cents, which will
    be between 65% and 80% lower than the comparative period (HY2020: 29.43
    cents);
•   HEPS for the current period will be between 5.84 cents and 10.22 cents, which will
    be between 65% and 80% lower than the comparative period (HY2020: 29.21
    cents).

For HY2021, Normalised EPS and Normalised HEPS exclude the effects of the IFRS2
executive share-based payment expense of R24.1 million relating to the Executive
Share Option Agreements.

For HY2020, Normalised EPS and Normalised HEPS have not been adjusted and are
therefore the same as EPS and HEPS.

The Normalised EPS and Normalised HEPS is the responsibility of the directors of Huge,
has been prepared for illustrative purposes only and may, because of their nature, not
fairly present the Company’s financial performance.

This trading statement has not been reviewed or reported on by the Company’s
external auditors.


Johannesburg
23 November 2020

Sponsor
Nedbank Corporate and Investment Banking

Date: 23-11-2020 05:40:00
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