Mr Price is a fashion casualty

Mr Price earning photographs.PHOTO SUPPLIED

Mr Price earning photographs.PHOTO SUPPLIED

Published Sep 2, 2015

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Johannesburg - Mr Price Group shares fell the most in more than 14 years after the South African clothing and household-goods retailer said low levels of consumer confidence and “some poor fashion calls” curbed sales.

The stock dropped 13 percent, the biggest decline since March 2001, and traded at R207.01 at the close in Johannesburg, the lowest since October 20. The shares are down 12 percent this year, valuing the company at R55 billion ($4.1 billion).

The FTSE/JSE Africa General Retailers Index is up 7.2 percent.

South African consumer confidence dropped to a 14-year low in the second quarter of this year as unemployment of 25 percent, power cuts and rising fuel prices put pressure on shoppers.

Mr Price sales were also affected by a later winter than expected, the company said.

Total sales rose 9 percent in the 21 weeks through Aug. 22, with same-store revenue advancing 4.6 percent, the Durban-based company said in a statement on Tuesday. Sales gained 16 percent in the comparable period a year ago.

“Disappointing sales growth for April and May” hurt overall performance, Mr Price said.

“Opportunities in the current trading period were lost in the mens’ and ladies’ junior businesses,” the retailer said. “Despite this, good growth was achieved in most other parts of the business.”

BLOOMBERG

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