The Foschini Group’s earnings took a dive after it reported that profits for the first six months ending September 30, 2023 (H1 2024) were down.
The fashion company noted that its headline earnings per share dropped by 15.3%.
It should also be noted that basic earnings dropped by 16.2%.
“Group retail turnover grew by 12.4%, supported by the continued expansion of our footprint and brand portfolio and further growth in online retail turnover in South Africa,” TFG said.
“The strong trade during the current period, along with continued focus on resetting the cost base, enabled growth of 0.8% in operating profit before finance costs”.
OPTIMISM FOR BLACK FRIDAY
The group said they were looking to reach greater profit with the Black Friday sales and festive season buying.
“Consistent with prior years, the second half of the group's financial year is heavily dependent on Black Friday and Christmas trade, which will largely determine performance for the full year,” TFG acknowledged.
"On balance, we're relatively optimistic. We've got the stock that we need; stores are ready, so it really comes down to, can we trade, and again you have to measure it against a very high base," CEO Anthony Thunström told Reuters.
TRIM SPENDING AND COSTS
In June, the group said that all spending and capital expenditure plans had been pushed back.
They knew that 2023 would be a hard year, stating at the time that the next six months would remain challenging, especially for the South African business, where load shedding and increased consumer pressures are expected to deteriorate.
In the second half of 2023, TFG noted that support and administration expenses of R220 million were frozen, and similar cost-savings initiatives were planned till the end of the year.