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REUNERT LIMITED - Operational update and trading statement
2021/05/11 16:33:00Download PDF Stock report
Operational update and trading statement Reunert Limited (Incorporated in the Republic of South Africa) (Registration number: 1913/004355/06) JSE code: RLO ISIN: ZAE000057428 (“Reunert”, the “Company” or the “Group”) OPERATIONAL UPDATE AND TRADING STATEMENT Reunert is in the process of finalising its interim financial results for the six-month period ended 31 March 2021 (“Results”). The board of directors of Reunert (“Board”) will consider and is expected to approve the Results on 24 May 2021 for publication on SENS on 25 May 2021. Accordingly, shareholders of Reunert (“Shareholders”) are provided herein with: • an operational update; and • the resulting trading statement. Operational update Reunert’s overall financial results for the period ending 31 March 2021 (“H1:2021”) have improved notably compared to the prior period. However, the recovery of the H1:2021’s operating profit to pre COVID-19 levels continued to be negatively affected by the reduced economic activity associated with the pandemic, specifically during the second wave which occurred in South Africa during January and February 2021. The Group’s segmental operating profit, before impairment of financial assets, reflected an increase in performance, and pleasingly, are largely in line with the guidance provided in the 2020 financial year end results. The Results include a good recovery in profitability in the Electrical Engineering Segment and an Information Communication Technology (“ICT”) Segment performance in line with expectations. The Applied Electronics Segment was negatively impacted by lower than anticipated export sales and a stronger Rand. Our Group companies have fully adjusted to the new operating conditions required by COVID-19 and are operating smoothly, albeit at slightly lower volumes than the prior comparative period. Importantly, the Quince book has performed in line with our expectations in H1:2021, with no further increases in expected credit losses (ECL) or credit write-offs being incurred. This, coupled with no impairment needed at our businesses, led to an improvement in attributable profit for the period. The Group has continued to deliver on its program of operational efficiencies and execution of its strategy. The Solutions and System Integration cluster in the ICT Segment is in the process of concluding strategic acquisitions in the Cloud and Custom Software areas. The Total Workspace Provider cluster continued its investment and growth in Complementary Services. There was a significant increase in investment in build, own, operate (BOO) solar assets in our renewable energy business and the Group reduced its ownership of our cable asset in Zimbabwe. The Group also commenced a share buy-back program during H1:2021. Trading Statement In terms of paragraph 3.4(b) of the JSE Limited Listing Requirements, issuers are required to publish a trading statement as soon as they are satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported on will differ by at least 20% from those of the prior comparative period. Shareholders are accordingly advised that the Group has reasonable certainty that it will report: • basic earnings per share of between 177 cents and 211 cents compared to a basic loss per share of 172 cents for the prior comparative period; and • headline earnings per share of between 185 cents and 201 cents compared to the headline loss per share of 76 cents for the prior comparative period. The information contained in this announcement does not constitute an earnings forecast. The financial information on which this announcement is based has not been reviewed nor reported on by the Company’s external auditors and is the responsibility of the Board. Johannesburg 11 May 2021 Sponsor One Capital Date: 11-05-2021 04:33:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.