Interim headline earnings in Truworths are expected to be lower by between 4% and 8% at between 472 cents and 492 cents. Photo: Bloomberg
Retail sales for Truworths South Africa decreased by 1.1% in the half year period to December 29, 2024 after account sales fell by 0.9%, with the company now expecting its interim headline earnings per share to be lower by between 4% and 8%.
Retail sales for the company were 1.1% lower compared to the same period in 2023. It said the 0.9% lowering in account sales for the period was comprised of about 70% of the segment’s retail sales for the current period as cash sales decreased by 1.6%.
However, online sales for Truworths “continued to show good growth in the current period,” rising by 38% and contributing 5.8% to Truworths’ retail sales.
Although Truworths retail sales were lower, group retail sales for the half year period under review increased by 2.4% to R12.5 billion, compared to the same period a year earlier.
Account sales comprised 47% of group retail sales, with cash sales increasing by 5.3% and account sales decreasing by 0.9%, relative to the prior period.
“The Group’s Office UK segment continued its impressive trading performance, driven by its successful store modernisation and expansion programme, a top-tier e-commerce platform, and strong, well-established brand partnerships. Despite the broader challenges in the UK market, retail sales in the Office UK segment increased in Sterling terms by 11.3% to £180 million (R4.16 billion), following a strong performance in the prior period which recorded retail sales growth of 15.6% to £162m,” said the company.
In Rand terms, retail sales for Office UK segment increased by 9.9% to R4.2bn.
Notwithstanding retail sales growth at a group level, overall estimated earnings in Truworths are expected to decline compared to the prior period, mainly due to the decrease in sales and expected gross profit margin decline in Truworths South Africa.
Interim headline earnings in Truworths are thus expected to be lower by between 4% and 8% at between 472 cents and 492 cents.
Gross trade receivables in respect of the active account portfolio for the period decreased by 1.6% to R7.1bn, with the number of active accounts decreasing by 0.7%.
“Active account holders able to purchase and overdue balances to gross trade receivables were unchanged relative to the prior period-end at 83% and 12%, respectively.”
BUSINESS REPORT