TFG is betting on renewed momentum in its neighbouring markets with Namibia emerging as a standout performer.
While the group continues to strengthen its global footprint through acquisitions such as British lifestyle brand White Stuff, CEO Anthony Thunström said the retailer’s near-term focus was firmly on regional opportunities.
Thunström told Business Day that the company’s operations across the Southern African Development Community were performing well, with Namibia showing strong economic revival.
“We are very happy with the performance of the largely static countries we are in. Namibia in particular is having quite a strong economic revival and we think there is a lot of upside there,” he said.
“Our main concentration at the moment is close to home.”
TFG, which trades from more than 3,600 stores across six African countries, has been quietly strengthening its regional presence over the past few years.
The group’s expansion into markets such as Namibia, Botswana, Zambia and Eswatini has provided a modest but stable growth base, helping offset some of the weakness in SA.
Thunström said the company saw value in these “close to home” markets, where economic recovery and stable consumer spending were creating room for growth, particularly in the middle-income segment.
While TFG is finding new opportunities in Southern Africa, its global operations are also helping to drive growth. The acquisition of UK lifestyle brand White Stuff has lifted the group’s international contribution, giving it a stronger foothold in the competitive British market and diversifying its earnings base.
Thunström said the integration of the UK brand had gone smoothly, with its strong retail systems and digital platforms being adopted across TFG’s London operations.
“One of our big themes is diversification. White Stuff gives us exposure to a different customer base, a more casual lifestyle brand that complements our existing UK portfolio.”
He said the company continued to look for growth offshore but remained cautious about timing and market conditions.
The group on Friday reported a decline in profit at the halfway stage of its financial year, despite double-digit revenue growth driven by its acquisition of White Stuff and a strong surge in online sales.
Group revenue for the six months ended September rose 12.2% to R31.4bn, with sales up 12.7%, the group said in a statement on Friday.
Attributable profit declined to R944m from R1.198bn before, and operating profit fell 9.9% while headline earnings per share (HEPS) were 21.3% lower at 292.6c.
An interim dividend of 130c a share was declared, 18.8% lower than last year.
The group said it had tightened capital management amid subdued demand and higher costs.
Group online sales were a standout rising 55.3% to make up nearly 15% of total retail sales, up from 10.7% a year ago. In SA, online sales through TFG’s Bash platform grew 40.2%, reflecting the group’s continued digital drive.
TFG said clearance markdowns on winter stock and soft consumer spending led to a negative operating leverage despite tight cost control.
The group said SA, which comprisedabout two-thirds of total sales, saw revenue growth of 5.3%. Clothing sales rose 4.2%, homeware 9.3% and beauty 23.6%. However, inflation, weak GDP growth, and heavy discounting reduced segmental earnings by 9.7%.
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