South Africa’s Truworths posts 12% rise in FY profit

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(Reuters) – South African clothing retailer Truworths International reported a 12 percent increase in full-year profit on Thursday, boosted by cash sales at its British unit Office Holdings, but falling short of estimates.

* Group retail sales for the 52-week period ended 26 June2016 increased by 46.1 percent to 17.0 billion rand ($1 billion)versus comparable period. * Headline and fully diluted headline earnings per share for52 weeks ended June 26 up 12 percent to 667 cents, but short of702 cents estimate by Thomson Reuters Smart Estimates. * Shares in Truworths down 6.7 percent at 85.34 rand by 1450GMT. * Cash sales outpaced sales on in-store credit as Britishfootwear chain Office sells only in cash and new rules in SouthAfrica hamper credit extension. * “Credit retail sales were significantly impacted by theintroduction of new affordability assessment regulations inSeptember 2015, which management estimates resulted in a loss ofbetween 200 million rand to 250 million rand in sales,” thecompany said. * Annual dividend per share up 12 percent. * “We expect the South African trading environment to remainchallenging during the 2017 financial period, with slow economicgrowth and rising inflation putting pressure on consumers,” thecompany said. * The trading environment in United Kingdom is also facedwith uncertainty after decision to withdraw from European Union,but is likely to be less uncertain as more clarity regardingBrexit emerges, the company said.


($1 = 13.3300 rand)


(Reporting by TJ Strydom; Editing by James Macharia)

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