CAPE TOWN - Long4Life management are expecting headline earnings per share to fall in the interim period, 2019 due mainly to the tough operating environment and accounting regulation adjustments, and in spite of a rise in turnover, CEO Brian Joffe said at the annual general meeting on Tuesday.
“The group is anticipating reasonable results for the six months to August 30, 2019 with pleasing top line growth,” he said of 2017-listed lifestyle and leisure group. He covered the trading period from March 1.
“Headline earnings per share, as a result of the above as well as the application of IFRS 6: Leases and the effect of share based payments, will be less than the unadjusted comparative period’s headline earnings per share. Disclosure of the impact of IFRS16 will be provided to enable comparability of financial numbers,” he said.
‘“Our operating environment is exposed to and continues to feel the pressures of the constrained economy,” he said.
The Sport and Recreation division, which includes business such as Outdoor Warehoue, and performance brands such as First Ascent and Capestorm was operating satisfactorily with like-for-like sales growth and basket sizes showing were positive signs.
The Personal Care and Wellness division, which has businesses such as Sorbet, Limelight and the sub-acute rehabilitation medical company ClaytonCare, was performing in line with expectations.
The area of disappointment was Chill Beverages within the beverage division.
Significantly investment in production capacity had taken place from the end of the second half of last year, there had been an increase in sales and marketing and product development activities, while an export division had been established for own brands.
“This expenditure and increased production capacity has not as yet been matched by increased sales in the interim period,” said Joffe.
The balance sheet remained strong, and the group was continuing to buy back its own shares. As at August 19, 2019, the group acquired a further 11.8 million shares at an average price of R4.27 per share, since the previous financial year ended February 28, 2019.
Long4Life would report its interim results on or about October 24, 2019. The share price fell 1.25 percent to R3.95 on Tuesday morning.