Retail figures released this week show winners and losers on the high street but no clear trend
South African retailer Mr Price was celebrating this week after posting a 8.3 per cent increase in third-quarter sales. But Mr P’s story is not being repeated across the clothing sector: Truworths International revealed a lower half-year profit.
The previous day clothing retailer The Foschini Group and food retailer Shoprite Holdings reported higher nine months and six months to December sales, respectively.
Truworths and Woolworths Holdings warned profits will be lower as consumers spent cautiously over the festive season, according to a report by moneyweb.co.za.
Political and policy uncertainty hobbled business and consumer confidence for most of last year, but victory for Cyril Ramaphosa, who is viewed as pro-business, in the ruling African National Congress’s leadership battle is seen as reversing this, according to0 the report.
Mr Price – which also sells homeware and sports goods – said total retail sales were R6.6 billion ($542m) for the three months to end-December, buoyed by the retailer’s core clothing division.
“Despite a competitive retail environment, well executed merchandise offers resulted in lower markdowns and an improved gross profit over the comparable period,” the statement issued by Mr Price, which also sells homeware and sporting goods.
Sales by Mr Price’s clothing division were up 11.3 per cent.
Truworths said it expects diluted headline earnings per share for the 26 weeks to 31 December to fall by up to 5 per cent to between 372 cents and 380 cents. Half-year sales rose by 1 per cent compared to the directly corresponding period.
Data on Wednesday (Jan 17) showed that South African retail sales jumped in November by their biggest margin in more than five years as sales in clothing, footwear and furniture rose, as the economy showed further signs of recovery.
However, Woolworths warned on Monday that its half-year profit could drop by as much as 17.5 per cent.
