Rex Trueform posts R27.2m operating profit

Operating profit at R27.2 million was down from the R37.7 million reported last year.

Revenue for the year was at R502.8 million up from the R465.6 million reported before.

The board is recommending to shareholders that the dividend on the ordinary and 'N' ordinary shares be maintained at 35 cents per share.

The group said as foreseen in the interim report, the second half-year to June 2009 presented a challenge as the downturn in consumer demand took greater effect.

This resulted in a second half performance which moderated the results for the full year, it said.

In its retail business, Queenspark achieved an increase in turnover of 12.2% to R466.2 million, it said.

"The pleasing performance of the first half of the year was not repeated during the second half where the turnover improvement moderated to 6.2% on the previous year, reflecting a deteriorating retail climate," said Rex Trueform.

It said performance for the year was impaired by a provision of 5.6 million, being an unrealised foreign exchange loss resulting from a revaluation of forward exchange contracts on hand at 30 June 2009.

The group said clothing-manufacturing activities at the Atlantis plant continued to encounter absenteeism problems and low levels of productivity.

In addition there was a major customer cutback on orders as a consequence of the downturn in consumer demand.

Following a profitable period in 2008 this segment incurred a loss of R2.1 million in 2009.

"It is likely that a further loss will be incurred in the 2010 financial year."

The group said four new stores were opened during the year and a further four stores would open before December 2009.

Although turnover for the first two months of the new financial year is marginally improved on last year it is too early to gauge how the summer season will develop, it said.

Rex Trueform said depressed retail conditions were expected to continue, however, for at least the remainder of 2009 calendar year, and the achievement of sales targets would remain challenging.

Rex Trueform is the principal operating subsidiary of African & Overseas Enterprises (AOO), which saw its full year headline earnings per share at 111.9 cents compared with the 181.5 cents reported before.

Published courtesy of