Renovated stores cuts Edcon’s lossComment on this story
Johannesburg - Edcon, South Africa’s largest clothing retailer, said its first-quarter loss narrowed as more shoppers visited revamped stores.
The net loss was 499 million rand in the three months through June compared with a year-earlier loss of 712 million rand, the Johannesburg-based company said in a statement today.
Gross profit rose 1.9 percent to 2.5 billion rand, while store costs rose 13 percent to 1.5 billion rand as the company completed a 72-outlet refurbishment program.
“Edcon believes the base for change has now been built, and is satisfied that total performance has stabilised,” the company said.
“Despite a tougher economic environment, growth opportunities are evident,” and “customers are responding positively to the changes made across all our store formats.”
The company’s chains, including Edgars, Jet, CNA, Boardmans and Red Square, operated 1,430 outlets at the end of the period, with average retail space rising 5.1 percent.
South African retailers have reported weaker sales growth this year as rising unemployment and inflation discourage consumer spending.
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.
Revenue from operations outside South Africa accounted for 11 percent of retail sales in the quarter, up from 9.9 percent a year earlier. - Bloomberg News