Company Announcement - • Revenue for the period increased by 14% to R4.5 billion 
• Operating profit, excl BEE, up 32% to R331 million
• Headline earnings, excl BEE, increased by 36% to R249 million
• Interim dividend per share growth of 36% to 513 cents

Cashbuild, southern Africa’s largest retailer of quality building materials and associated products, selling direct to a cash-paying customer base through 228 retail outlets, reported a strong set of interim results for the six months ended 31 December 2015. Werner de Jager, Chief Executive of Cashbuild, stated: “We obtained shareholder approval on 30 November 2015 to buy back 200,000 shares and distribute the value of between R2,500 and R17,500 to each Cashbuild Empowerment Trust beneficiary. The interim results have been impacted by the once-off cost of
R63 million. The results reported in this media release excludes this once-off cost.”

Revenue for the Group increased by 14% to R4.5 billion, with Cashbuild’s 15 new stores, opened after 1 July 2014, contributing 3% of revenue growth with the existing 213 stores contributing 11% of revenue growth. Operating profit improved by 32% to R331 million, resulting in a record operating profit margin of 7.3% compared to the 6.3% achieved in the prior period to December 2014. “We are satisfied with this margin as it attests to management’s strict control of operational expenses in a challenging economic climate”; commented Etienne Prowse, Financial Director of Cashbuild.

Basic earnings per share and headline earnings per share for the period under review increased by 37% to 1 131 cents and 37% to 1 092 cents, respectively. The interim dividend per share for the period increased by 36% to 513 cents.

Cashbuild increased cash on hand by 23% to R1.3 billion at the end of 31 December 2015 and maintained its debt-free position. Cashbuild has a strong Balance Sheet to pursue opportunities, such as the P&L Hardware (Pty) Ltd (P&L) acquisition, which was unconditionally approved by the Competition Tribunal on 3 February 2016. De Jager said: “The effective date of this transaction is expected to be during March 2016. It further allows us opportunity to continue our geographical footprint in other southern African areas. Our expansion plans into Zambia are progressing well with the first store set to open in Lusaka beginning of March 2017.”

Trading conditions for the remainder of the financial year ending 30 June 2016 are expected to remain subdued. Cashbuild’s stated strategy is in place to mitigate risks the Company could potentially face.  Cashbuild’s expansion plan to open at least 10 new stores per annum is progressing well with six new stores already opened during this reporting period.