Johannesburg - Edcon Holdings Pty Ltd., a South African clothing retailer owned by Bain Capital Partners LLC, posted a wider first-quarter loss as store revamps disrupted operations and sales fell.
The net loss widened to 714 million rand ($69 million) in the three months through June, compared with 214 million rand a year earlier, the Johannesburg-based company said in a statement today.
Same-store sales fell 0.3 percent, while store costs rose 7.3 percent to 1.3 billion rand.
Edcon, which owns chains including Edgars, Jet, CNA, Boardmans and Red Square, had 1,301 outlets at the end of the period, with the average retail space rising 4.2 percent.
“In the Edgars division, the implementation of the second phase of the 72-store refurbishment program is well under way,” Edcon said in the statement.
“The heavy build element of this program negatively affects results, but initial numbers from the first 16 stores completed during June are promising and the work is still on track to be substantially completed before the beginning of the Christmas trading period.”
South African retailers have reported weaker sales growth this year as rising unemployment and inflation put the brakes on consumer spending.
Inflation rose to 6.3 percent in July, exceeding the 6 percent upper limit of the central bank’s target for the first time in 15 months as a weaker rand boosted gasoline costs and electricity prices climbed.
Bain Capital, based in Boston, bought Edcon for about 25 billion rand in May 2007 to tap into rising economic growth in Africa’s largest economy. - Bloomberg News