Steinhoff International: EU recovery delivers better returns

First-half profit at Steinhoff International rose 44 percent as consumer spending and market share improved, the furniture chain that generates more than half its sales from Europe reported yesterday. Net income for the six months to December last year increased to R4.6 billion from R3.2bn a year earlier. Sales advanced 17 percent to R67.4bn. Steinhoff is benefiting from signs of economic recovery in Europe and a weaker rand against the euro, which the company gets through sales at brands including France’s Conforama chain. The rand’s decline against most other currencies prompted the company to sell e465 million (R6.9bn) of convertible bonds in January. “In a period when consumer confidence in Europe showed some improvement, market share gains and margin improvement were prominent in many of the countries where we operate,” Steinhoff said. Its shares fell 30c to close at R51.04 yesterday, giving up earlier gains to as high as R52.20. The stock has advanced about 14 percent this year, compared with a 2.7 percent increase in the all share index. – Bloomberg