Truworths says it expects full-year earnings to decline as stronger sales from its UK business failed to offset weaker trading in SA.
The fashion retailer said headline earnings per share (HEPS) were expected to fall up to 11%, with overall profit set to drop more sharply because the previous year’s results were boosted by one-off gains.
HEPS for the 52 weeks ended June are expect to be 728c-761c, 7%-11% lower than a year ago.
Office UK delivered solid growth, supported by steady demand for branded footwear and ongoing store investments, but the local business continued to struggle with weak consumer spending, rising living costs and unseasonal weather that dampened winter sales.
The group said cash sales in SA declined and account sales were unchanged, although online sales rose strongly as more customers shopped digitally. The company said the local credit market is showing signs of improvement and its credit book remains stable.
In contrast, the UK business outperformed the wider market, helped by a focused product offering and a store refurbishment programme. Truworths said its international operations helped cushion the effect of slower trading at home, but this was not enough to avoid a fall in profit.
“Truworths Africa’s gross profit margin came under pressure relative to historical norms. Late deliveries of winter merchandise in the prior period due to port congestion and global shipping disruptions, combined with the delayed onset of winter in 2024, dampened seasonal demand,” the group said.
“As a result, elevated markdowns were required in the first half of the current period to meet terminal stock objectives. Continued weak trading conditions necessitated increased in-season promotional activity to manage inventory levels effectively. Despite these challenges, management was encouraged by signs of recovery in the SA consumer credit environment.”
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