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Short-Form Announcement, Cash Dividend Declaration and Board Changes for the Six Months ended 31 December 2022
Italtile Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1955/000558/06)
Share code: ITE
ISIN: ZAE000099123
("Italtile" or "the Group")
SHORT-FORM ANNOUNCEMENT, CASH DIVIDEND DECLARATION AND CHANGES TO THE BOARD
FOR THE SIX MONTHS ENDED 31 DECEMBER 2022
- System-wide turnover up 3% to R6,2 billion
(2021: R6,1 billion)
- Trading profit down 8% to R1,4 billion
(2021: R1,5 billion)
- Earnings per share down 5% to 79,5 cents
(2021: 84,0 cents)
- Headline earnings per share down 6% to 79,2 cents
(2021: 83,9 cents)
- Net cash up 51% to R0,8 billion
(2021: R0,5 billion)
- Ordinary dividend per share down 6% to 32,0 cents
(2021: 34,0 cents)
- Net asset value per share up 14% to 620,6 cents
(2021: 543,0 cents)
- Store network up 1% to 214
(June 2022: 211)
(December 2021: 209)
OVERVIEW
Founded in 1969, Italtile Limited is a Proudly South African manufacturer, franchisor and retailer of tiles, bathroomware
and other related home-finishing products. The Group's retail brands are CTM, Italtile Retail, TopT and U-Light, represented
through a total network of 214 stores, including six online webstores. The retail operation is strategically supported by a
vertically integrated supply chain comprising key manufacturers and import operations and an extensive property portfolio.
TRADING ENVIRONMENT AND GROUP PERFORMANCE
During the review period, homeowners' disposable income remained under severe pressure and activity in home renovation
continued to decline from the peak experienced during the pandemic. The generally adverse economic, social and
political environment also influenced uncertain consumers to defer or scale down on renovation and new build projects.
Inflation-driven input costs placed significant margin pressure on the business, which experienced material increases
in the cost of fuel, imported raw materials, equipment maintenance, and property-related expenses. Unprecedented load
shedding and failure of state energy infrastructure disrupted manufacturing and retail operations, impacting on sales,
productivity and profitability. The aggregated gross margin across the Group declined by 1,6% compared to the prior
corresponding period. Margins in the integrated supply chain (both manufacturers and importers) were reduced to support
our price-sensitive customers.
Notwithstanding the challenging environment, the Group achieved sales growth and substantially improved the underlying
cash position.
DECLARATION OF ORDINARY CASH DIVIDEND
The Group's dividend cover is two and a half times. The board of directors of Italtile ("the Board") has declared an
interim gross cash dividend (number 113) for the review period ended 31 December 2022 of 32,0 cents per share
(2021: 34,0 cents) out of income reserves to all shareholders of Italtile as at the record date of Friday, 3 March 2023.
The dividend per share is calculated based on 1 321 654 148 shares (2021: 1 321 654 148 shares) in issue at the date of
dividend declaration. The net local dividend amount is 25,6 cents per share for shareholders liable to pay dividends
tax and 32,0 cents per share for shareholders exempt from paying dividends tax. Italtile's income tax reference number
is 9050182717.
Dividend declaration date Monday, 13 February 2023
Last day to trade cum the dividend Tuesday, 28 February 2023
Date to commence trading ex-dividend Wednesday, 1 March 2023
Record date Friday, 3 March 2023
Payment date Monday, 6 March 2023
Share certificates may not be rematerialised or dematerialised between Wednesday, 1 March 2023 and Friday, 3 March 2023,
both days inclusive.
BOARD COMPOSITION
In compliance with paragraph 3.59 of the Listings Requirements of JSE Limited, the board of directors of Italtile ("the Board"?) hereby
notifies its shareholders that with effect from 30 June 2023 the Group's founder, Mr Gianni Ravazzotti, will retire from his position as
non-executive Chairman of the Board and will assume the role of non-executive director. He will remain active in the business in his new
position. Ms Luciana Ravazzotti Langenhoven, who has served as non-executive Deputy Chairman since 2018, will succeed Mr Ravazzotti as
non-executive Chairman of the Board. This transition is part of the Group's long-standing succession programme. Ms Ravazzotti Langenhoven
has over 30 years of experience with the Group.
PROSPECTS AND OUTLOOK
The Group's aspiration is to be the best manufacturer and retailer of tiles, sanitaryware and complementary products in
Africa, by offering an unrivalled shopping experience through the strategy of ensuring the right products, beautifully
presented, at the right time, place and price.
The strength of the Group lies in our skilled dedicated people, strategic vertically integrated business model,
diversification and scale, which affords us the resilience and agility to navigate cyclical challenges and capitalise
on opportunities that arise. Management is confident in the Group's robust operating model, quality assets and
high-performance culture. We will continue to focus on levers in our control to grow the business and execute our
strategy to provide an unrivalled shopping experience which exceeds the expectations of existing customers and inspires
new customers.
The uncertainty in the global macro-economy and in our local market is likely to continue for the remainder of the
year, together with elevated inflation and intensifying load shedding. In the context of this current climate, it is
not prudent to provide more specific guidance regarding future performance at this point.
13 February 2023
SHORT-FORM ANNOUNCEMENT
The content of this short-form announcement is the responsibility of the directors. Shareholders are advised that this
short-form announcement represents a summary of the information contained in the full long-form announcement which is
available at: https://senspdf.jse.co.za/documents/2023/jse/isse/ite/interims23.pdf and on Italtile's website at
https://www.italtile.com. This short-form announcement was published on SENS on 13 February 2023.
Any investment decisions made by investors and/or shareholders should be based on a consideration of the full announcement
as a whole and investors and shareholders are encouraged to review the full announcement, as detailed herein.
Both the short-form and full announcement are also available for inspection at the registered offices of Italtile and sponsor,
Merchantec Capital, during business hours, and copies may be obtained at no cost on request from the Company Secretary, who is
contactable on +27 11 882 8200 or lizwillis@ejaysecretarial.co.za.
Registered office: The Italtile Building, corner William Nicol Drive and Peter Place, Bryanston, 2021
(PO Box 1689, Randburg, 2125)
Transfer secretaries: Computershare Investor Services Proprietary Limited
Company Secretary: EJ Willis
Sponsor: Merchantec Capital
Auditor: PricewaterhouseCoopers Inc.
www.italtile.com
Date: 13-02-2023 07:15:00
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