South Africa’s Truworths’ on a path to recovery

0
528
  • 38 stores reopened
  • Headline earning per share to go up 23%-28%
  • Earnings per share to increase to between 463 to 483

JSE listed South African clothing retailer Truworths international limited says it is recovering from the effects of the looting and unrests which crippled business operations.

The unrests left 57 of its 758 stores that would normally account for approximately 7% of the retail sales in the Group’s South African store portfolio impacted directly and severely damaged by looting and destruction of property while approximately 160 stores were indirectly affected as a consequence of precautionary closures.

In a trading update statement for the 52-week period ended 27 June 2021, the group said they were able to reopen 38 of the 57 affected retail outlets while all the stores that were closed as a precautionary measure resumed trading.

“The Group expects to have reopened a total of 48 of the affected stores by the end of August,” the group added.

Meanwhile, three more stores are scheduled to reopen around the middle of September, while the reopening dates of the remaining six stores remain unknown due to the severe fire damage to the shopping centers in which they are located.

The group added that they are in the process of engaging with their insurers to submit and finalize all claims as speedily as possible and believes that it has adequate insurance cover to mitigate much of these losses.

“The Group is in the process of quantifying the losses resulting from damage to stores, the loss of stock (predominantly winter stock) and the loss of profits as a consequence of the inability to trade”  said the group.

Despite these unrests affecting business operations, the group forecasts its headline earnings per share (‘HEPS’) for the 52-week period ended 27 June 2021 to increase to between 503 cents and 523 cents from the 410 cents recorded in the prior year, representing an increase of at least 23% to 28%.

Earnings per share (‘EPS’) for the period are estimated to increase to a minimum of 463 cents to 483 cents from the -133 previously recorded.

The Group’s audited annual results for the period are expected to be published on or around 2 September 2021.

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