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Trematon warns of 85% plunge in earnings

Apr 13 2018 09:38
Lameez Omarjee

Cape Town - Investment holding company Trematon [JSE: TMT] has warned of an 85% plunge in earnings for the six months to February 28.

In a notice to shareholders issued on Friday morning the group, which has a portfolio which includes various properties and a school group, advised that there would be a difference of more than 20% in its earnings, compared to the previous interim period

“Shareholders are advised that Trematon’s earnings per share for the 6-month period ended 28 February 2018 will decrease by approximately 85% and headline earnings per share will decrease by approximately 150% from the previous comparable interim period ended 28 February 2017,” the notice read.

Earnings are expected to be 7.1 cents per share, compared to the 46.4c reported previously. The headline loss is expected to be 0.9c per share, compared to 1.8c earnings reported in the previous comparable interim period.

The group explained that the earnings drop is due to the disposal of its 30% stake in Mykonos Casino in the previous interim period. The disposal yielded a once-off profit of R91.8m.

The headline earnings drop is further due to expenses related to properties which were taken on and refurbished, as well as increased schools’ costs associated with its expansion programme for current schools.

The group regards the intrinsic net asset value as the “most important measure” of shareholder value, and expects this to rise by 24% to 446c per share from 361c/share.

“The increase is mainly due to the sale of mature properties within the Resi Investment Group and development sales at Club Mykonos Langebaan, both of which realised values in excess of the director’s valuations, as well as fair value adjustments on some of the remaining properties and investments.”

The group’s book net asset value is expected to increase by about 30% to 389c/share from 299c/share.

The interim financial results are expected to be released on April 23, 2018.

The share price opened at R3.01 on Friday morning. Shares were trading down 5.63% to R2.85 by 09:45.

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