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AVI LIMITED
Registration number 1944/017201/06
Share Code: AVI
ISIN: ZAE000049433
("AVI" or “the Company”)
CHAIRMAN’S COMMENT ON TRADING CONDITIONS
At the annual general meeting of AVI held on 9 November 2022,
Gavin Tipper commented in relation to trading conditions that:
“The trading environment has remained challenging with
inflationary pressures and the weak macro environment reducing
consumer spending. The impacts of severe load-shedding and
supply chain disruptions following Transnet’s strike were
effectively managed, albeit at a cost to both revenue and
margin.
Group revenue for the quarter ended September 2022 increased by
9.7% over the same period in the prior year, materially due to
price increases to ameliorate cost pressures. Revenue growth
was achieved in all major categories except I&J where poor
catch rates and an unfavourable abalone sales mix impacted the
quarter’s revenue. Higher selling prices in some categories
impacted short-term sales volumes, with an ongoing focus on
long-term margin protection in the face of systemic inflation.
Revenue and margin in the footwear and apparel business
continue to improve, assisted by volume gains, partially
because of the non-recurrence of the disruption as a result of
the unrest in July last year.
The consolidated gross profit margin declined marginally with
accumulated cost pressures not fully recovered as our
businesses work to find the best balance between volume and
value in a volatile environment. Selling and administrative
expenses increased at rates above inflation, partially due to
the impact of a substantially higher fuel price on distribution
costs, the timing of marketing investment, and the impact of
fair-value accounting on the Group’s hedge positions.
Consolidated operating profit was 2.1% higher than the same
quarter in the prior year. The Group’s branded consumer
business, excluding I&J, improved operating profit by 9.5% over
the same period last year.
The results for the remainder of the 2023 financial year remain
materially dependent on sound consumer demand over the festive
season and through the second semester.”
The information above has not been reviewed and reported on by
the Group’s auditors.
Illovo
10 November 2022
Sponsor
The Standard Bank of South Africa Limited
