Mr Price rides cash sales wave in crunch
Mr Price had stores closed on government measures to contain the spread of the pandemic.
The group said the relaxation of the measures in May saw customers coming back, with sales increasing 12 percent and with Mr Price Apparel and Sheet Street achieving double-digit growth of 16.1 percent and 15.2 percent respectively, while Mr Price Sport increased 7.7 percent and Mr Price Home was marginally up by 1.3 percent.
It said only Miladys disappointed, with sales falling 13.8 percent.
“In May and June combined, cash sales increased 16.7 percent, while credit sales declined by 9.4 percent,” Mr Price said.
The group said the credit landscape was expected to deteriorate further, positioning it well to capture market share. It said that cash sales shot up 85.6 percent from 82.2 percent the prior year.
In the 52 weeks to March 28, Mr Price reported a 2.1 percent increase in revenue from continuing operations to R23.03 billion, with retail sales increasing by 1.5 percent to R21.2bn.
Its cash sales, including cellular, grew 2.4 percent and now make up 84.3percent of total sales.
Mr Price reported a 9.3 percent decline in profits to R2.70bn and basic earnings per share decreased by 9.5 percent to 1042.4 cents a share, while headline earnings per share declined 10.4 percent to 1047c.
The group did not declare a final dividend in order to preserve cash.
“The group experienced a decline in cash reserves of approximately R2bn during the 5-week lockdown period,” Mr Price said.
“However, a strong, cash-based performance since then has ensured the current financial position remains sound, with cash resources and a debt-free balance sheet available to support current business operations and future uncertainty.”
The group said it had opened 71 new stores and expanded a further 16, after closing 16 stores and reducing the size of 28 stores during the period, taking its total corporate-owned stores to 1378. Looking ahead, the group said about R300 million in budgeted expense reduction has been identified as part of group wide austerity activities and cash preservation.
Mr Price shares declined 0.26percent on the JSE yesterday to close at R145.34.