Cashbuild has said it expects headline earnings per share (HEPS) to drop by as much as 40% when it releases its annual results.
Building retailers, including Builders Warehouse and Italtile, have all been experiencing a decline in sales since the 2021 home improvement boom when consumers invested in their homes during the Covid-19 pandemic as people worked and socialised at home.
Weaker consumers and a lack of investment in infrastructure also means the construction industry is in decline.
Cashbuild’s HEPS, a main profit measure in SA, will be between 1,157.6c and 1,254.1c.
It is impairing goodwill in investment in lower-end hardware chain P&L, which it bought in 2016 and has continued to underperform. This means it expects P&L stores to do worse than previously predicted and it is less valuable than recorded on their books. Earnings per share will therefore decrease by 75%-80%.
Cashbuild’s results are expected to be released on August 30.
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