Trading statement for the financial year ended 31 December 2020
Incorporated in the Republic of South Africa
(Registration number: 1924/002590/06)
Share code: AFE ISIN: ZAE000000220
Hybrid code: AFEP ISIN: ZAE000000238
Bond company code: AECI
(AECI or the Company)
TRADING STATEMENT FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2020
In compliance with the JSE Limited Listings Requirements, shareholders and noteholders are advised that for the
financial year ended 31 December 2020 (the period), AECI’s headline earnings per share (HEPS) is expected to be
between 920 cents and 863 cents, that is between 20% and 25% lower than the 1 150 cents for the financial year
ended 31 December 2019 (the prior corresponding period). Earnings per share (EPS) is expected to be between 147
cents and 86 cents, that is between 88% and 93% lower than the 1 223 cents in the prior corresponding period.
The significant contributors in this regard during the period were as follows:
• The COVID-19 pandemic had a severe impact on trading in many of the sectors in which AECI’s customers
operate, resulting in lower revenue and profitability particularly in the first half-year. Although more
normalised trading was evident in most of the affected sectors in the second six months as pandemic-
related restrictions were eased, a recovery to pre-pandemic levels had not been achieved by year-end. It is
estimated by management that the negative effect of COVID-19 on HEPS and EPS in the period was
approximately 340 cents. Historical information on the Group’s financial performance and market trends
in sectors where the Group operates were used to calculate this estimate.
• AECI Much Asphalt operates in the road infrastructure sector, which was among the most severely
impacted by COVID-19 restrictions in the first half of 2020.
The South African government is committed to investment in infrastructure projects, including road
infrastructure. Owing to fiscal priorities as a result of COVID-19, however, in the Company’s view a level of
uncertainty remains as to the pace at which it will be possible to execute these projects. Following an
assessment by management in the context of this uncertainty, R821 million (or 778 cents in EPS terms) of
the R1 530 million goodwill recognised at acquisition was impaired.
An unwavering focus on the diligent management of cash through the COVID-19 pandemic enabled a considerable
improvement in cash generation compared to the prior corresponding period. The benefits of this were reflected
in the Company’s net gearing ratio which is expected to be between 20% and 25% compared to 36% as at 31
AECI is currently finalising its results for the period and it is expected that these will be released on the Stock
Exchange News Service on or about Wednesday, 24 February 2021.
The financial information on which this trading statement is based has not been reviewed, reported on or audited
by the Company’s external auditor. The information provided does not contain, and should not be construed as
containing, any forward-looking statements or projections of any nature for the financial year ended 31 December
17 February 2021
Sponsor and Debt Sponsor: Rand Merchant Bank (A division of FirstRand Bank Limited)
Date: 17-02-2021 09:52:00
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