HOW LISTED SA FASHION RETAILERS WORE THE MARKET TUMULT
south Africa’s five dominant players in the listed clothing retailer space namely, Pepkor, TFG, Mr Price, Woolworths and Truworths, last had their best trading days on the JSE back in March 2018, when their share prices peaked.
The clothing sector had been marred by weak economic growth, subdued consumer confidence and declining earnings in previous months. According to Overberg Asset Management, the consensus view at the time was that the clothing retail sector would continue to rise over the next three years.
Like many other sectors, clothing retailers found themselves amid unprecedented adversity during the Covid-19 pandemic, with revenues and margins under pressure, but with the exception that some players have weathered the storm better than their counterparts.
TFG
In its financial results for the half-year ended September 2020, TFG reported a headline loss per share of 91c, down 117.1%. Headline earnings per share (HEPS) had come in at 531.2c in the comparable period a year earlier. Group revenue had plunged by 25.3% to R13.9bn and retail turnover was down 26.1% to R12.5bn.
Although the group cannot provide details of which clothing products yielded the highest margins to the market, “clothing, apparel and footwear achieved higher margins than cellphones“, according to TFG.
The fall in revenue was attributed to most of the group’s 4 083 trading outlets across major trading territories being closed for about eight weeks. Further lockdowns in Australia, the UK and other international markets, continued to adversely impact trading performance well into the second half of 2020. During the period, 63 TFG stores were opened while 183 were permanently closed. Group online turnover contributed 14.4% to retail turnover (R12.5bn) with strong growth for TFG Africa and TFG Australia at 115.8% (in rand)
