South African fashion retailer Truworths warns on half-year profit

January 29, 20249:19 AM GMTUpdated 3 days ago

JOHANNESBURG, Jan 29 (Reuters) – South African fashion retailer Truworths (TRUJ.J) on Monday warned that half-year profit growth had slowed after financially constrained shoppers held back from discretionary spending.

Truworths said retail sales in South Africa – its biggest market – were hit by poor economic conditions and high interest rates that squeezed disposable income and knocked consumer confidence.

“Furthermore, port congestion challenges in South Africa resulted in lower than expected merchandise deliveries for the December period,” Truworths added.

The challenging backdrop also hit rivals TFG (TFGJ.J) and Woolworths (WHLJ.J).

Truworths’ headline earnings per share for the 26 weeks to Dec.31 would be up 4% at most, compared with 10.3% growth in the same period a year earlier, the upmarket retailer said.

Shares in the company were down 1.5% at 73.86 rand by 0847 GMT.

Group retail sales rose 8.2% year on year to 12.2 billion rand ($650.4 million), with sales for Truworths Africa, its biggest business, down 0.3% at 8.4 billion rand.

Black Friday and holiday discounts also failed to attract shoppers in South Africa, where retail sales from Oct. 30 to Dec. 31 fell by 1.6% to 4 billion rand.

The group’s British-based shoe chain Office grew sales in sterling terms by 15.6% and by 33.1% in South African rand terms in the 26-week period.