PSG GROUP LIMITED - Unaudited Financial Results And Ad Hoc Dividend Declaration For The Six Months Ended 31 August 2020

            
PSG
Unaudited Financial Results And Ad Hoc Dividend Declaration For The Six Months Ended 31 August 2020

PSG GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1970/008484/06)
JSE Limited (JSE) share code: PSG
ISIN code: ZAE000013017
LEI code: 378900CD0BEE79F35A34
(PSG Group or the Company)


UNAUDITED FINANCIAL RESULTS AND AD HOC DIVIDEND DECLARATION FOR THE
SIX MONTHS ENDED 31 AUGUST 2020

1.   SALIENT FEATURES

        At 31 August 2020, the 
         o Sum-of-the-parts (SOTP) value per share was R75,86, representing a
           decrease of 20% when compared to the R94,44 per share as at
           29 February 2020 if the unbundled Capitec Bank Holdings Ltd (Capitec)
           shares, as contained in PSG Groups SOTP value at its ruling market value as
           at 29 February 2020, are excluded therefrom at such date for comparative
           purposes; and
         o Net asset value per share was R73,27, representing a decrease of 14% and 16%
           when compared to the R85,27 as at 31 August 2019 and R87,49 as at
           29 February 2020, respectively.

        At 9 October 2020, the SOTP value per share was R82,80.

        Ad hoc interim dividend declared of R1,64 per share.

2.   CHANGE IN INVESTMENT ENTITY STATUS AND EARNINGS

     International Financial Reporting Standards (IFRS) require that an entity reassess
     whether it is an Investment Entity if facts or circumstances indicate changes to one or
     more of the elements making up the definition of an Investment Entity or the typical
     characteristics of an Investment Entity.

     Whilst PSG Group's focus on value creation for its shareholders has not changed, the
     major corporate action detailed in the full announcement has necessitated PSG Group to
     reassess its Investment Entity status in terms of IFRS, whereby it was determined that it
     became an Investment Entity with effect from 1 March 2020. The performance of its
     remaining investment portfolio is accordingly measured with reference to the fair value of
     each investment (i.e. SOTP value) rather than the consolidated profitability of PSG Group
     (i.e. recurring earnings) with effect from 1 March 2020 in PSG Groups strive to meet its
     objective of value creation through capital appreciation, investment income or both.

     Where an entitys status change to that of an Investment Entity, it does not consolidate its
     subsidiaries, but rather measures subsidiaries at fair value through profit or loss. Such
     change in accounting is applied prospectively, with no adjustment to prior year
     comparatives. However, an Investment Entity continues to consolidate subsidiaries that
     provide services related to the Investment Entitys investment activities (i.e. those wholly-
     owned subsidiaries comprising PSG Groups head office operations).

     Pursuant to the aforementioned change in Investment Entity status, PSG Groups
     financial statements prepared in accordance with IFRS are not comparable to prior
     periods. For the period under review, PSG Group reported earnings per share of R118,62
     (2019: R6,39) and a headline loss per share of R14,14 (2019: earnings of R5,68). The
     headline loss per share is representative of mainly the decrease in the share prices of
     PSG Groups listed investments, while the earnings per share included a significant non-
     headline gain to the extent that the fair value of the unbundled Capitec interest exceeded
     its accounting carrying value as a non-current asset held for sale on the date of
     unbundling, being 30 July 2020 when PSG Group shareholder approval was obtained.
     Continuing operations profit before finance costs and taxation, as detailed in PSG
     Groups full announcement, amounted to R5,7bn (2019: R1,1bn).

3.   DIVIDEND DECLARATION

     Following the aforementioned unbundling of Capitec, PSG Groups policy is to pay ad hoc
     dividends as and when circumstances allow. As part of PSG Groups objective of
     continued wealth creation, the directors have resolved to declare an ad hoc interim gross
     dividend of 164 cents (2019: 164 cents) per share from income reserves for the six months
     ended 31 August 2020.

     The ad hoc interim dividend amount, net of South African dividend tax of 20%, is 131,2
     cents per share for those shareholders that are not exempt from dividend tax or are not
     entitled to a reduced rate in terms of the applicable double-tax agreement. The number
     of ordinary shares in issue at the declaration date is 229 936 695, and the income tax
     number of the Company is 9950080714.

     The salient dates for this ad hoc dividend distribution are:

     Last day to trade cum dividend              Tuesday, 3 November 2020
     Trading ex-dividend commences               Wednesday, 4 November 2020
     Record date                                 Friday, 6 November 2020
     Payment date                                Monday, 9 November 2020

     Share certificates may not be dematerialised or rematerialised between Wednesday,
     4 November 2020 and Friday, 6 November 2020, both days inclusive.

4.   SHORT-FORM ANNOUNCEMENT

     This short-form announcement is the responsibility of the directors of the Company. It
     contains only a summary of the information in the full announcement and does not contain
     full or complete details. The full announcement can be found at:

     https://senspdf.jse.co.za/documents/2020/JSE/ISSE/PSG/PSGHY21.pdf

     The full announcement is also available for viewing on the Companys website at
     https://www.psggroup.co.za/UnauditedResultsAug2020.pdf or may be requested and
     obtained in person, at no charge, at the registered office of the Company or the
     Companys sponsor during office hours.

     Any investment decisions should be based on consideration of the full announcement.

5.   RESULTS PRESENTATION

     Shareholders are invited to view PSG Groups interim results presentation to be
     broadcast live on YouTube at 09h00 SAST on Thursday, 15 October 2020.

     Presentation details:
        - View and listen mode;
        - Link: https://youtu.be/Krnz2Gty_6g;
        - Presentation slides will be made available on PSG Groups website shortly before
          the live broadcast of the presentation;
        - Questions may be e-mailed prior to and during the presentation to:
          questions@psggroup.co.za.

Stellenbosch
15 October 2020

Sponsor
PSG Capital (Pty) Ltd

Independent joint sponsor
UBS South Africa (Pty) Ltd

Date: 15-10-2020 07:05:00
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