Truworths flags profit decline on lower sales in Africa unit

South African fashion retailer Truworths warned last week that its half-year profit will fall by up to 8%, mainly due to a decline in sales and gross profit margin in its Africa business.

Source: Reuters/Lelethu Madikane

The upmarket retailer has seen a decrease in profit over the past year as customers, squeezed by high interest rates, cut discretionary spending.

Truworths, which also owns UK-based shoe retailer Office, sees its headline earnings per share dropping by 4% to 8% in the 26 weeks ended 29 December 2024, down from 512.6 cents last year.

Its shares were down 2.4% by 0922 GMT.

The retailer, whose brands include Daniel Hechter, Uzzi and Naartjie, said group retail sales in the period grew by 2.4% to R12.5bn, a slower growth rate compared to 8.2% sales growth in the previous comparable year.

The main cause of the drag was its Africa unit, which reported a sales decline of 1.1% to R8.3bn during the period, which included Black Friday and Christmas trade.

The group's Office UK business reported retail sales growth of 11.3% to £180m, driven by its successful store modernisation and expansion programme, and e-commerce platform, it said.