WeBuyCars announced on Tuesday that it expects to report higher annual core headline earnings, despite a significant decline in headline earnings, projected to fall by up to 60% due to one-off costs related to its recent listing.
The company’s core headline earnings, which exclude certain non-recurring or non-cash items to provide a clearer picture of underlying performance, are expected to rise by 21% to 26%, reaching between R798 million and R832 million. Core headline earnings per share (HEPS) are anticipated to be between 212.5 cents and 222.4 cents, reflecting a 7% to 12% increase.
In contrast, headline earnings are forecasted to drop by 55% to 60%, falling to between R324 million and R364 million. HEPS is expected to decline significantly, with projections ranging from 85.6 cents to 97.8 cents, marking a decrease of 60% to 65%.
The drop in headline earnings is attributed to non-core transaction costs and adjustments related to call option derivatives. Prior to its listing on the JSE in April, WeBuyCars incurred R45 million in one-off fees for professional, legal, and listing services. Additionally, a derecognition of a R426.5 million call option derivative asset will also contribute to this decline.
WeBuyCars plans to release its full-year results on November 18.