Durban - Tile and sanitaryware manufacturer Italtile on Monday reported that its sales for the five months to end-November had shown an improvement of 14.7 percent to R2.9 billion.
Chief financial officer Brandon Wood said while the company had expected better sales during the period, it would take any figure that had shown positive growth.
“We are generally happy about the results and the company’s performance, but to be honest we were hoping for a better performance. The country’s economy hasn’t been performing and the consumer continues to feel the pinch, so we will take the results under the circumstances,” Wood added.
The group said that the results for the five months to November included total system-wide sales with the new stores included.
The group said nine TopT stores were opened during the period, although their full contribution to revenue would only be reflected in the following six months.
The group said on a like-on-like retail store basis, turnover grew 10 percent compared with the previous corresponding period, with average price inflation estimated at 7.9 percent.
Wood added that the company was still waiting for the appeal it launched with the Competition Tribunal about their merger with Ceramic Industries.
The owner of retail brands such as CTM and TopT wanted to acquire the remaining shares it does not own through its wholly-owned subsidiary, Italtile Ceramics. Italtile wanted to acquire up to an additional 73.5 percent stake in Ceramic Industries for a proposed R3.75 billion.
However, the Competition Commission turned down the merger in July by saying it would create unfair competition in the industry. “The merged entity could foreclose retailers by raising prices, reducing supplies or refusing outright to supply,” the commission ruled. As a result the matter has been taken to the tribunal by Italtile.
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“Yes, we appealed the decision by the commission, and as we speak it is in front of the Competition Tribunal. We expect two things to happen from there: we can settle the matter with the tribunal or we can go for a full hearing in March,” Wood explained.
Despite hitting a snag with the Ceramic Industries merger, the year has been good for Italtile. The company reported in August a 16 percent increase in trading profit to R1.05 billion for the year to end June.
Other changes in the group will see outgoing chief executive Nick Booth stepping down and handing over the reins to Jan Potgieter. Booth will be leaving the company at the end of February.