Holdsport increases total sales but forecasts challenging year

Published May 8, 2014

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Nompumelelo Magwaza

Holdsport increased total sales by 3.1 percent to R1.4 billion for the year to February and completed its Cape Town wholesale distribution centre, the sports and outdoor wear retailer said on Tuesday.

Retail sales rose 3.3 percent to R1.3bn, while like-for-like sales increased by only 2.9 percent.

During the year, Holdsport incurred R42.1 million on maintaining and expanding its retail operations and it spent R40.2m to complete its wholesale distribution centres in Cape Town.

The retailer, which owns Sportsmans Warehouse, Outdoor Warehouse and Performance Brands outlets, said operating profit increased by 2.8 percent to R250m.

Core headline earnings amounted to R4.23 a share, a 1.1 percent increase on the previous year.

Holdsport said its retail division experienced price inflation of approximately 4.9 percent for the year, with trading space growing by 5.6 percent relative to the previous year.

Sportsmans Warehouse’s sales increased by 2.9 percent. The division, which trades out of 35 stores, opened a new store in Sea Point and closed a store in Amanzimtoti in Durban.

Like-for-like sales in its Outdoor Warehouse division fell by 3.9 percent.

Performance Brands’s external sales were 1.4 percent lower than last year but sales to the group’s retail divisions increased by 26.9 percent, the retailer said.

“We expect trading conditions to remain challenging in 2014,” Holdsport said.

The company added that it repaid loans of R124.3m to Standard Bank during the year and replaced them with a R130m loan from the FirstRand Group.

Currently, the company has a net debt of R72.4m – lower than the previous year, when it was at R87.9m.

Holdsport was also able to purchase and award R4.9m of Holdsport shares in terms of, and subject to, the rules of the 2011 Holdsport forfeitable share plan.

Holdsport shares climbed 1.79 percent to close at R39.90 on Tuesday.

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