S&V Weekly Newsletter Vol.5 No.37, September 16, 2019

This Newsletter is sponsored by SAFLIA

Please note: Click on any ad to go to the advertiser’s website

Retail last week

Comment from 3 retailers on Saturday
"Not bad at all, but the reason is I'm closing at the end of the month and I've cut my prices and doing quite nicely." - Hymie Kaplan, proprietor, Hariton's Outfitters, Cape Town, W Cape, SA. The store opened in 1957. However, he said, he was negotiating with another retailer to take over the business and hopefully keep the name. I hope to report on the change in the next newsletter.

"It's been fair. This winter was a bit warm, so we've been left with a bit of stock. We've also noticed that the middle of the month is a bit quieter, and the end of the month is busier." - Stuart Pearson, proprietor, Health Wise, East London, E Cape, SA. Independent, 1 store, health products retailer including mostly women's footwear.

"Friday wasn't bad, the previous few days were mediocre. Some stocks are working well, others not. Funnily enough suits are doing well, and formal shoes too, but generally with footwear price is a big factor." - Mike Levi, Hepworth's/Mike's Outfitters, Johannesburg, Gauteng, SA. Mini-chain, men's outfitter.

Stock Exchange News Service (SENS) release

AVI final results June 2019

Johannesburg, Gauteng, SA (September 9, 2019) – Revenue for the year went down 2.1% to R13.2 billion (R13.4 billion) whilst operating profit before capital items was 1.2% lower at R2.5 billion (R2.6 billion). Profit attributable to owners decreased by 4.3% to R1.6 billion (R1.7 billion). Furthermore, headline earnings per share decreased by 4.9% to 516.6 cents per share (543.1 cents per share).
       Dividend: Notice is hereby given that a gross final ordinary dividend No 93 of 250 cents per share for the year ended 30 June 2019 has been declared payable to shareholders of ordinary shares.
       Company outlook: The trading environment is expected to remain difficult, with constrained consumer spending. Our expectation is that many of our categories will continue to have low, or even negative, growth rates until there is a meaningful improvement in the economy. Notwithstanding this, all of AVI’s businesses are targeting profit growth in the next financial year, underpinned by:
       *Strong brands, supported by relevant innovation, that remain appealing to many consumers;
       *Foreign currency and key raw materials for the majority of the year’s requirements secured at levels that support sound levels of profitability, including lower rooibos and butter prices than achieved in the 2019 financial year;
       *Good price levels secured for key raw materials for the majority of the year’s requirements, including lower rooibos and butter prices than achieved in the 2019 financial year.
       Acceptable demand and sales volumes are key to achieving growth and we will continue to react quickly to market changes as we pursue the most appropriate balance of price, sales volumes and profit margins for each of our brands. This will be supported by ongoing focus on factory efficiency, procurement opportunities and review of fixed overheads. Capital projects that underpin our manufacturing capacity, product quality and service levels will continue to be supported. AVI International, supported by our South African manufacturing capabilities, remains focused on steadily building our brands’ shares in export markets whilst sustaining strong profit margins.
       I&J’s prospects remain materially dependent on fishing performance and exchange rates. We remain of the view that the performance of the hake resource is set to improve over the next few years, while export exchange rates are largely secured at levels that support sound profitability, and the more recent Rand weakness provides some upside potential. The hake long-term rights application process, to allocate rights from 2021, is not expected to impact operations in the financial year ahead. The Board is confident that AVI remains well positioned to compete effectively; prudently manage fixed and variable costs; and recognising the challenging environment, be alert for appropriate acquisition opportunities both domestically and regionally. The above outlook statements have not been reviewed or reported on by AVI’s auditors.. 

Mr Price - allegations of non-compliance

To address recent market speculation, the Company advises as follows:
       Allegations of non-compliance with the Mr Price Code of Conduct by two members of senior management and a single supplier has come to the attention of the Mr Price Group Executive Directors and the Board. In accordance with the Company's standard disciplinary processes, these employees have been placed on precautionary suspension while an internal investigation is underway to ensure this matter is fairly and expediently resolved. The allegations do not relate to any financial reporting irregularities, nor do they involve any Executive or Non-Executive Directors.

NOTE: A footwear supplier to Mr Price said he didn't know who the supplier is, but that if it had been a footwear supplier, he would have known about it.

Competition Commission recommends approval for Footgear/Edcon deal

Footgear (Pty) Ltd (Footgear) v The assets and business associated with the Edgars Active and High Key brands of Edcon Limited (the Target Business)
Pretoria, Gauteng, SA (September 12, 2019) - The Commission has recommended that the Competition Tribunal (Tribunal) approve the proposed transaction whereby Footgear intends to acquire the Target Business without conditions.
       Footgear mainly operates as a retailer of branded and non-branded footwear and, on a limited scale, as a retailer of accessories and apparel.        The Target Business is active in the retailing of branded and non-branded footwear, apparel and accessories. The Target Business comprises of approximately 116 retail stores across the continent (including 109 stores located in South Africa). 
         The Commission found that the proposed transaction is unlikely to result in a substantial prevention or lessening of competition in any relevant markets. The Commission further found that the proposed transaction does not raise any public interest concerns.

Movements

Cape Town, W Cape, SA - Former National Braiding W Cape sales representative Patrick Gordon left the company and was replaced as of April 1 by Merle Dodgen.

Port Elizabeth, E Cape, SA - Max-Cowell MD Mike Hoffmann retired on September 6. Owen Mathers has been appointed as the new MD.

Johannesburg, Gauteng, SA - Former Top Life Menswear cc member Mike Levi has retired. His son, Adrian, and Conrad Moolman, are the top management now. Top Life trades as Hepworth's and Mike's Outfitters.

They Said It

"The rent is killing me, I've turned 71, and I've got Parkinson's - add it all up and divide by 2, and the answer is 'get out'." - Hymie Kaplan of Hariton's Outfitters, also quoted in Retail Last Week, above. I have a strong suspicion notification of his retirement is premature.

S&V Directory - Order now

The directory is ready. On sale for R450. The online version is also available at R450 for 12 months' access.

2019 Trade Fairs Another essential service from S&V

Please note that we have put a list of the 2019 trade fairs and conferences on our website, linked to their websites: http://www.svmag.co.za/events

Exchange rates

Source: http://www.x-rates.com/calculator/

ABSA Agri Trends 28/08: Hides & skins prices

Hides: R1.52/kg. This is 1% lower than last week’s price of R1.54/kg. The current price is 70.8% lower than prices were a year ago. The market remains under immense pressure, a recovery is not be expected in the short to medium term. The impact of the big decline on hide prices plays an important role in the  broader beef industry, because hides form a part of the cattle’s ‘fifth quarter’ which contributes to the processor’s return from animal purchased. During 2017 and 2018, beef prices were so good, which probably meant that the lower hide prices had a minimal impact and could have been overlooked. However, beef prices have declined now and this is bringing the hide value component back into the spotlight. - Wessel Lemmer, senior agricultural economist, Absa Group. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies.

16/09/1965: Roy Feigenbaum, Superior Leather, Bramley.
17/09/1944: Avril Goldstein, Daisy Roots, Balfour Park.
19/09/1976: Harunur Rashid Rubel, Splendour Investments Ltd, Manzini, Swaziland.
19/09/1976: Shahid Koor, Urban Mania, Cape Town.
20/09/1947: Patrick ‘Chicken’ Price, agent, Durban.
21/09/19??: Renate du Rand, Ghia 33 Shoes & Accessories, Knysna.
21/09/1972: Nicholas Gordon, Turbek Trading, Johannesburg.
22/09/1938: Peter Broughton, freelance, formerly Nicole Footwear [closed], Durban.
22/09/1972: Martin Dedekind, Hlungwana Trading Store, Paulpietersburg.

In Memoriam this week

18/09/1992: Wally Barkus, agent, Durban.
18/09/2012: Jimmy Andresen (b. 02/06/1947), agent, Johannesburg.
18/09/2000: Marthinus Philipus ‘MP’ Theunissen (b. 09/06/1919), Chemical Specialities/Clariant, Durban.
20/09/1998: PW (Pat) Singh, Palm Footwear, Durban.
21/09/1997: Ronnie Venter, agent.
22/09/2005: Simon Power (b. 10/07/1950), Mister Mover, Pinetown.

Have you let us know about your birthday, or the birthdays of your colleagues? Our readers love this section, so please become part of it. This also applies to the In Memoriam section. Help us remember former colleagues.

Have a look at these links

We invite businesses to send us links to websites, Facebook pages and the like which they feel would be of interest to others. The links below are from our database:
Beier Envirotec, Pinetown, KZN, SA. Component manufacturer.: www.beierenvirotec.co.za
Bella Bianca, Durban, KZN, SA. Handbag manufacturer.: www.bellabianca.co.za

Contact us

News & Classifieds: Tony Dickson, +27 (0)31 209 7505, tony@svmag.co.za

Next newsletter: September 23, 2019.

SAFLIA enquiries: Tel 0800SAFLIA * Email info@saflia.co.za * Website http://www.saflia.co.za

Should you wish to subscribe email tony@svmag.co.za
Our website www.svmag.co.za