South African retailers climbed to the highest in a week after Mr Price Group Ltd. said full-year earnings rose by more than 20 percent and Pick n Pay Holdings Ltd. said sales growth improved in the second half.
The 10-member FTSE/JSE Africa General Retailers Index rallied 3.6 percent, the most for almost three years, and closed at 63,082.9 in Johannesburg, the highest since March 11. The gauge had slumped 3.2 percent in the prior five days.
“The Mr Price announcement today surprised on the upside and after a lot of bad news for retailers, this is being welcomed,” Henre Herselman, a derivatives trader at Nedbank Group Ltd.’s BoE Stockbrokers in Johannesburg, said by phone.
Earnings per share adjusted for one-time items rose by at least 20 percent in the 52 weeks ended March 30, Durban-based Mr Price said today in a statement. Shares in the clothing, furniture and linen retailer advanced 6.1 percent, their biggest gain in 2 1/2 years, to 122.3 rand, the highest since Feb. 19.
Pick n Pay Stores Ltd., South Africa’s second-largest grocer, said sales growth increased to 8.2 percent in the second half of its fiscal year, compared with 5.9 percent in the first. Its shares gained 0.9 percent, the most in more than a month.
Africa’s largest economy has struggled under a 24.9 percent unemployment rate and will probably grow by 2.7 percent this year, according to government forecasts.
Woolworths Holdings Ltd., which sells food and clothing, gained 3.8 percent, its biggest rise in almost six months. “Woolworths, with its food and clothing offering, benefits from diversification and is one of the stronger stocks in the sector,” Herselman said.
South African consumer confidence slumped to a nine-year low in the first quarter as slower economic growth, job losses and higher inflation curbed households’ finances, First National Bank and the Bureau for Economic Research said in a statement yesterday.