Mustek, a manufacturer and distributor of consumer electronics, informed shareholders on Friday (17 August) that turnover increased by 18.2% to R4.143 billion, for the year ended 30 June 2012.
Included in profit from operations, is R47 million relating to realised and unrealised foreign exchange losses, from a prior R20.6 million profit.
Mustek said it uses the Rand/USD spot rate at the beginning of each month to determine its selling prices, with adjustments made during the month should the exchange rate change substantially.
Inventory is accounted for at the exchange rate at the time when risks and rewards transfer to the company, and accounting standards do not allow the fair valuation of inventory but require the corresponding foreign accounts payable to be stated at the closing spot rate.
“As long as this is the case and the Rand remains as volatile as it currently is, reported earnings will be in line with the volatilities of the Rand,” it said.
As a result, Mustek advised that, for the year ended 30 June 2012, headline earnings per share is expected to be between 15% and 25% lower than the 89.39 cents per share in 2011.
Basic earnings per share is expected to be between 10% and 20% lower than the basic earnings of 86.38 cents per share of the previous year.
Net asset value per share is expected to be between 690 cents and 710 cents, the group said.
Mustek expects to publish its results on about 28 August 2012.