ADCORP HOLDINGS LIMITED - Trading Statement And Operational Update For The Half Year Ended 31 August 2018

Trading Statement And Operational Update For The Half Year Ended 31 August 2018

Adcorp Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1974/001804/06)
Share code: ADR & ISIN: ZAE000000139
("Adcorp" or "the Company" or “The Group”)

TRADING STATEMENT AND OPERATIONAL UPDATE FOR THE HALF YEAR ENDED 31 AUGUST 2018

Trading statement

In terms of the Listings Requirements of the JSE Limited, companies are required to publish a trading
statement as soon as there is a reasonable degree of certainty that the financial results for the period
to be reported upon next will differ by at least 20% from the financial results for the previous
corresponding period.

Adcorp shareholders are therefore advised that the results for the period ended 31 August 2018 are
expected to be as follows:

.   Total basic earnings per share of between 82 cents and 100 cents per share compared to the total
    basic loss per share of 120.7 cents for the period ended 30 August 2017. This amount arises from
    both continuing and discontinued operations as follows:

       o Basic earnings per share from continuing operations of between 88 cents and 95 cents per
         share compared to the prior period basic loss per share from continuing operations of
         49.0 cents.
       o Basic loss per share from discontinued operations of between 0.29 cents and 0.61 cents
         per share compared to the prior period basic loss per share from discontinued operations
         of 71.7 cents which is an improvement between 100% and 99%.

.   Total headline earnings per share of between 85 cents and 93 cents compared to the total
    headline loss per share of 40.1 cents for the period ended 30 August 2017. This amount arises
    from both continuing and discontinued operations as follows:

       o Headline earnings per share from continuing operations of between 87 cents and 90 cents
         compared to the prior period headline loss per share from continuing operations of 28.2
         cents.
       o Headline loss per share from discontinued operations of between 0.29 cents and 0.61
         cents per share compared to the prior period headline loss per share from discontinued
         operations of 11.9 cents which is an improvement between 98% and 95%.


Operational update

The clean-up of the Group in FY2018 enabled the leadership team to gain an understanding of its
true financial position and reset performance. This represented the first phase of the Group’s
strategic transformation. The focus in the current year is on stabilizing operations, stemming losses
from our Training business and unlocking short term wins as we develop a blueprint for the future of
Adcorp.

The Australia businesses have continued to provide a strong performance, with an 11% improvement
in EBITDA in Australian Dollars. This increase was dampened by the impact of exchange rate
movements resulting in a net 3% increase in South African rand.
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In the South Africa operations, revenue was relatively flat compared to August 2017. The drive to
right size the business and ensure a structure and processes that are efficient and optimal is yielding
benefits resulting in improved EBITDA. Both the Support Services and Training businesses have
experienced improved performance, with the latter no longer trading at a loss.

Total EBITDA for the period to August 2018 will range between R200 million and R220 million
compared to R95 million in the period to August 2017.

The improved EBITDA position, together with the focus on liquidity and working capital management
has strengthened the cash position of the Group. Cash generated by operations was R360 million
compared to R122 million in the period to August 2017. The closing cash at bank balance was R599
million compared to negative R19 million at 31 August 2017. This has also resulted in a reduction in
the net debt position to R632 million (31 August 2017: R1.294 billion) and a net cost of funding
reduction across the Group.

The financial results on which this trading statement have been based have not been reviewed or
reported on by the Group`s external auditors. The financial results of the Group are expected to be
published on or about 15 October 2018.

27 September 2018
Bryanston
Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd




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