Furniture retailer Lewis Group has reported an almost 10% rise in merchandise sales in the third quarter as consumer confidence improved and it benefited from strong marketing campaigns.
Group merchandise sales for the quarter to end-December increased by 9.9%, supported by strong Black Friday sales across all brands, after growth of 7.7% and 9.3% for the first and second quarters respectively.
Revenue rose by 13.6% in the nine months to December while sales grew by 9.1%, the group said in a statement on Monday.
Credit sales increased by 13.1%, accounting for 68.2% of total sales. Cash sales showed a strong turnaround in the December quarter with all three months reporting double-digit growth, resulting in an overall increase of 14.4% for the quarter and 1.5% for the year to date.
Comparable store sales grew by 6.2% for the nine-month period and 6.3% for the third quarter, the retailer, the owner of UFO, Beares, Best Home & Electric and Bedzone, said.
Other revenue, comprising effective interest income and ancillary services income as well as insurance revenue, benefited from the strong credit sales in recent years, increasing by 19.6% for the third quarter and 20.1% for the nine months.
Collection rates remained resilient and settled at a “satisfactory” 79.6% for the nine months and 79.7% for the third quarter, Lewis said.
Debtor cost growth was contained to 2% for the nine-month period and was 10.3% lower for the quarter.
Late last year, Lewis, which is valued at R3.9bn on the JSE, bought cash-only retailer Real Beds, which CEO Johan Enslin said at the time was a small acquisition, “but a very strategic one”.
The group created a new speciality segment to house Bedzone, Real Bed and UFO, which also sells beds.
Bedzone and Real Beds had a combined 32 stores and the plan was to increase that to 150 in the next three to four years, Business Times reported.
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