AVI LIMITED - Trading Statement and Update for the Six Months Ended 31 December 2020

Trading Statement and Update for the Six Months Ended 31 December 2020

AVI LIMITED
Registration number 1944/017201/06
Share code: AVI
ISIN: ZAE000049433
(“AVI”)


TRADING STATEMENT AND UPDATE FOR THE SIX MONTHS ENDED 31 DECEMBER 2020

Demand for our snacking and beverage brands normalised from the peaks during
the hard lock-down period as consumers returned to more normal spending
patterns. Sales of fragrance and beauty products improved during the
semester but have not yet recovered to pre COVID-19 levels. Our retail
brands’ sales recovered as shoppers increasingly returned to malls and high-
streets through the period.

Our ongoing efforts to keep staff safe and comply with the government’s
lockdown regulations ensured continuity of operations and minimised losses
of production and sales.

Group revenue for the semester decreased by 0,1% over the same period in
the prior year. Growth in our food and beverage categories was partially
offset by the continued impact of COVID-19 on sales volumes in the fashion
businesses and the Ciro out-of-home coffee solutions business. Revenue in
the fashion businesses was 90% of that achieved in the first semester of
last year. I&J’s Abalone business continues to be impacted by lower demand,
price pressure and logistical constraints in accessing the China and Hong
Kong markets.

Gross profit margins were lower in some grocery categories due to cost
pressures from the weaker Rand, however selling price increases should
contribute to an improvement over the remainder of the financial year. I&J’s
gross profit margin was impacted by the performance of the Abalone category.
Effective cost management resulted in a reduction in selling and
administrative costs, partially offsetting the lower gross profit and
resulting in a small decline in operating profit for the semester.

Net finance costs were materially lower than last year in line with lower
debt levels and interest rates, resulting in growth in headline earnings
for the semester.

CAPITAL GAINS
The first semester of the previous financial year included a capital gain,
after tax, of R373,7 million on the disposal of I&J’s 40% interest in the
Simplot joint venture in Australia. As there were no material capital items
in the first half of the current financial year, attributable earnings have
decreased.
CONSOLIDATED HEADLINE AND ATTRIBUTABLE EARNINGS
The weighted average number of shares in issue is expected to be 0,2%
higher than last year due to the issue of new shares in terms of the
Group’s various share incentive schemes.

We hereby advise shareholders, in accordance with Section 3.4 (b) of the
Listings Requirements of the JSE Limited, that:

   -   Consolidated headline earnings per share for the six months ended
       31 December 2020 are expected to increase by between 1% and 3% over
       the comparable period in the prior year, translating into an increase
       from last year’s 293,8 cents to a range of between 296 and 303 cents
       per share; and

   -   Consolidated earnings per share for the six months ended 31 December
       2020, including capital gains and losses, are expected to decrease
       by between 27% and 29% over the prior year, translating into a
       decrease from last year’s 410,2 cents to a range of between 291 and
       299 cents per share.

It is expected that AVI will release its full results for the six months
ended 31 December 2020 on or about 8 March 2021.

The information above has not been reviewed and reported on by the Group’s
external auditors.


Illovo
25 January 2021

Sponsor
The Standard Bank of South Africa Limited

Date: 25-01-2021 03:52:00
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