Edcon loss narrowsComment on this story
Johannesburg - Edcon Holdings (Pty) Ltd., South Africa’s largest clothing retailer, said its third-quarter loss narrowed as sales at the discount division gained and it refurbished its flagship Edgars stores.
The loss was 415 million rand in the three months through December, compared with 829 million rand a year earlier, the Johannesburg-based company said in a statement today.
Retail sales advanced 3.3 percent to 8.8 billion rand, while revenue at the discount division, which includes the Jet chain, rose 7.8 percent.
Edgars retail sales increased 0.6 percent as the outlets near the end of a renovation program amid a tougher retail environment, Edcon said.
The company plans to cut jobs at the 13,000-employee chain to improve its financial performance, Edcon said February 18.
“The refurbishment element of the transformation project in Edgars is now almost complete,” Edcon said.
“It is taking longer than anticipated to reap the benefits of the strategic changes within the Edgars chain of stores.”
South African retailers have been struggling over the past year as an unemployment rate of 24 percent and high inflation hurt consumer spending, with those that take credit sales particularly vulnerable.
Retail sales growth declined to 3.5 percent in December, compared with 4.4 percent the previous month, while South Africa’s Reserve Bank raised borrowing costs in January for the first time since 2008.
US private-equity firm Bain Capital Partners LLC., based in Boston, bought Edcon for 25 billion rand in 2007 to tap rising consumer spending in Africa’s largest economy.
Edcon, which owns chains including CNA, Boardmans and Red Square, has been revamping stores in an effort to regain market share. - Bloomberg News