Truworths Profit Little Changed as South Africa Retail StagnatesJanice Kew
Truworths International Ltd., the South African clothing chain that’s been boosting its childrenswear through acquisition, said first-half profit was little changed as consumer spending remained sluggish.
Net income was 1.39 billion rand ($119 million) in the 26 weeks ended Dec. 28, compared with 1.4 billion rand a year earlier, the Cape Town-based company said in a statement on Thursday. Credit sales accounted for 71 percent of total retail revenue, which rose 5.2 percent to 6.2 billion rand
“The trading environment is expected to remain difficult for the remainder of the 2015 financial period,” the owner of Uzzi and Daniel Hechter brands said. Truworths will “continue to utilize its extensive experience to manage the risk of fashion.”
South African retailers struggled last year as protracted strikes, unemployment of about 25 percent and slowing economic growth hurt consumer spending. Truworths rejected about 69 percent of new account applications in the period, compared with 74 percent a year earlier.
Truworths shares gained 1.7 percent to 82.90 rand as of 2:17 p.m. in Johannesburg, extending the year’s gain to 7.3 percent. The stock was little changed last year. The company raised the half-year dividend by 9 percent to 2.36 rand per share.