Clothing and homeware retailer TFG is assessing the extent of the damage and potential losses after 190 of its stores were looted and damaged in parts of KwaZulu-Natal and Gauteng.
Like other retailers, the owner of the Foschini, Markham and Sportscene brands was caught up in the social unrest that has since subsided, but has cost businesses billions of rand in damaged infrastructure and lost sales, according to preliminary estimates.
The violent protests, sparked by the arrest of former president Jacob Zuma for defying the Constitutional Court’s order to appear before the Zondo commission of inquiry to answer to allegations of plundering of state resources during his nine-year tenure as head of state, has also dented SA’s reputation to potential investors.
TFG, which also owns Totalsports, said on Friday a distribution centre owned by one of its logistics service providers, and manufacturing premises owned by one of its suppliers were damaged by fire during the unrest. However, that would not necessarily disrupt its supply chain.
“The situation remains uncertain, although there are encouraging signs of some parts of [KwaZulu-Natal] and Gauteng having settled. The group will continue to assess the damage caused to its stores and is quantifying losses to be recovered through its insurance policies. The loss of profit due to business interruption is also being quantified,” TFG said in a statement.
The cost of damages to infrastructure and stock losses will be covered by SA Special Risks Insurance Association (Sasria), a state-owned enterprise that covers damage caused during the politically motivated strikes.
TFG shares were relatively flat at R155.78 in mid-afternoon trade on the JSE, valuing the company at R51.7bn. However, the value of the shares have risen by 125% over a one-year period.
The fallout of the protests on its half-year results was difficult to determine at this stage, with its stores in KwaZulu-Natal were still temporarily closed due to safety concerns, according to the retailer.
TFG, which has a total of 3,000 stores in Africa and has clothing chains in the UK and Australia, said it would start the process of rebuilding and restocking the affected stores when it is safe to do so.
Mr Price, the clothing and homeware retailer that caters to predominantly low- to middle-income consumers, said on July 14 that 109, or 7%, of its 1,592 stores were entirely looted and had to temporarily close a further 539 stores across its six divisions, made up of Mr Price brand, Mr Price Sport, Mr Price Home, Miladys, Power Fashion and Sheet Street.
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