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

Comments (0) Africa, Business, Latest Updates from Reuters

(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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South Africa’s May retail sales beat expectations

Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South African retail sales rose more than expected in May to their strongest level in more than two years, signalling the economy may be on the mend after contracting in the first quarter of this year.

Retail sales in Africa’s most industrialised economy rose by 4.5 percent year-on-year in May, its strongest rise since early 2014 after expanding by a revised 1.6 percent in April, Statistics South Africa said on Wednesday.

Analysts polled by Reuters had forecast a 1.6 percent year-on-year increase in May.

On a month-on-month basis, sales rose by 3.4 percent and were up 3 percent in the three months to May compared with the same period last year.

The South African economy, beset by high and persistent unemployment, has been hobbled by low commodity prices and a severe drought.

“Second quarter 2016 saw commodity prices recover, with tentative signs to date that the industrial sector has pulled out of recession on a stronger performance from manufacturing production,” Investec economist Annabel Bishop said in a note.

“The economy could just manage to avoid recession in the first half of this year, potentially recording a small fractional positive for the second quarter instead.”

Manufacturing data on Tuesday showed output rose more than expected in May to its strongest level in nearly a year.

Overall economic output fell by 1.2 percent in the first quarter of 2016 mainly due to a slide in the mining sector, putting South Africa on course for its first recession in seven years.


(Reporting by Olivia Kumwenda-Mtambo; Editing by Ed Cropley)

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