S&V Weekly Newsletter Vol.11 No.10, March 10 2025
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Trading conditions (respondents in business alphabetical order)
Business
Pepkor buys Choice Clothing
Cape Town, W. Cape, SA – Pepkor Trading (Pty) Ltd is acquiring the 105 Choice Clothing and Big Daddy stores operated by Good Hope Sales Cape (Pty) Ltd. The stores are in the Western Cape and Namibia, and sell clothing, footwear, accessories and household textiles, aimed at low-income groups.
The Competition Tribunal “unconditionally approved” the acquisition last week.
Pepkor will retain the trading names under a new MD, Mark Riley.
Good Hope Sales retains its 21-store Going Under chain and its Ritewear wholesale division, and plans to grow both, according to a spokesperson, who described Going Under as “more of a factory outlet” than Choice, but aimed at the same consumer profile.
Shoetech resurrected as Shoet3ch
Pinetown, KZN, SA – A new company, Shoet3ch Consumables (Pty) Ltd, has been opened to take over the agencies and activities previously handled by Shoetech Engineering cc, which went into voluntary liquidation and closed at the end of January.
The new business is owned by Nicky, daughter of Shoetech cc member Eckie Schumann. She had been part of the previous business for over a year, and in a role reversal, he is now consulting to her. She has also brought back a former Shoetech cc staff member, Jolene Burns, “who is well known to our customers”.
Shoet3ch Consumables has given up the previous premises, and she said it would look at new premises in about 6 months’ time.
“I’ve been around the industry, and I know what our customers are going through,” she said. “There’s definitely place for what Shoetech was offering, and the decision to close Shoetech Engineering was complicated and had nothing to do with the business model.
“Shoetech was never closing – Shoet3ch is the beginning of a new era.”
Stock Exchange News Service (SENS)
Woolworths Holdings Ltd: Excerpts from the unaudited interim group results for the 26 weeks ended 29 December 2024
Food still carrying the business as fashion and Country Road restructure
| Turnover and concession sales |
R40.3bn (+5.7% on LY) |
| Turnover |
R39.6bn (+5.4% on LY) |
| Profit before tax |
R2.6bn (+6.3% on LY) |
| Adjusted profit before tax |
R2.0bn (-20.6% on LY) |
Cape Town, W. Cape, SA (Wednesday 05 March 2025) – The Group's results for the first half of the 2025 financial year reflect the continued strong performance from our leading Food business, offset by lower contributions from our apparel businesses, with both Fashion Beauty Home and Country Road Group in the throes of significant transformation.
From a macro-economic perspective, in South Africa, whilst discretionary spend remains constrained, consumer sentiment is improving, supported by moderating inflation, easing interest rates, and the suspension of loadshedding. In Australia, notwithstanding improved consumer sentiment and the uplift in retail sector sales, buoyed by Black Friday, the sustained effect of high interest rates and elevated living costs continues to weigh on consumer behaviour and discretionary spend, resulting in elevated promotional intensity, and significantly reduced profitability at a sector level.
Within this context, group turnover and concession sales for the current period increased by 5.7% and by 6.2% on a constant currency basis against the prior comparative 26-week period. The impact of softer-than-expected topline growth in our apparel businesses, coupled with pressure on gross profit margins and the increased operating expenditure attributable to our transformation initiatives, negatively impacted profitability during the period, particularly in the case of CRG. As a result, Group adjusted earnings before interest and tax declined by 13.7% on the prior period, to R2.8 billion. Group adjusted earnings before interest and tax, depreciation and amortisation decreased by a lesser 6.4% to R4.5 billion, reflecting the impact of the investment in our various strategic and growth-enabling initiatives. Adjusted diluted headline earnings per share declined by 19.4% to 169.1cps over the prior period, while headline earnings per share was down 24.8% to 152.8cps.
As part of the David Jones sale transaction in 2023, the Group retained the flagship property situated at 294 to 310 Bourke Street, Melbourne, Australia. The property was held as an investment asset and leased back to DJ on market-related terms. In December 2024, the Group successfully disposed of the property for A$223.5 million (R2.6 billion), recognising a profit on disposal. As a result of the sale of the property, earnings per share increased by 20.9% to 245.4cps.
The Group ended the period with net borrowings of R4.7 billion (versus net borrowings of R5.8 billion for the 53 weeks ended 30 June 2024), with the Australian subsidiaries in a net cash position of A$226.1 million, following the sale proceeds received for the property. The net debt to EBITDA ratio of 1.37 times is within our targeted gearing ratio and the Return on Capital Employed of 17.0% remains well above the weighted average cost of capital of 13.1%.
WOOLWORTHS
The combined South African business grew turnover and concession sales by 9.1% for the period, notwithstanding the aforementioned context. Whilst our Food business delivered strong aEBIT growth, this was offset by the lower contribution of FBH.
WOOLWORTHS FOOD
Our Food business delivered market-leading turnover and concession sales growth of 11.4% and 7.3% on a comparable-store basis.
WOOLWORTHS FASHION, BEAUTY AND HOME
Whilst our FBH business continues to make steady progress against its strategic priorities, performance over the half was impacted in part by a temporary setback in product flow arising from the implementation of new processes and systems within our Distribution Centre Transformation - a specific initiative within our broader Value Chain Transformation. This, coupled with late supplier deliveries, resulted in reduced product availability across much of our store base during the peak festive season. FBH turnover and concession sales increased by 2.5% and by 2.7% on a comparable-store basis over the period, with price movement of 1.2%. Notwithstanding the slower topline performance, Fashion also achieved positive underlying volume growth, with deflation of 0.8%. Our Beauty business has pleasingly sustained its momentum, delivering growth of 17.3% over the period, and further establishing Woolies as the Beauty destination in South Africa. In line with our strategy to rationalise unproductive space, net trading space decreased by 2.1% relative to the prior period, whilst online sales increased by 25.2% and contributed 6.6% of FBH sales.
An increased level of promotional activity during the period relative to the prior period, additional supply chain costs associated with the DC transformation, coupled with the margin dilutive impact of a strongly growing Beauty contribution, resulted in gross profit margin declining by 170bps to 46.3%. Expense growth was well managed at 4.5%, notwithstanding the increased investment and associated costs of strategic initiatives. Adjusted operating profit declined by 17.7% to R763 million, resulting in an operating margin of 9.8% for the current period.
COUNTRY ROAD GROUP
Following the sale of David Jones in the 2023 financial year, and the successful separation of CRG from DJ in the 2024 financial year, CRG is currently in the midst of a significant restructure to reconfigure its operating model and reset its structural economics as a standalone business. This restructuring is being implemented in an accelerated timeframe. In addition, as mentioned, the apparel trading environment in Australia and New Zealand remains significantly constrained, characterised by reduced footfall and spend, and intense promotional activity.
Within this context, sales declined by 6.2% for the period and by 7.8% on a comparable-store basis. Trading space decreased by 2.4%, while online sales contributed 27.1% of total sales for the period, up from 26.8% in the prior period.
Higher promotional activity to manage inventory levels and the impact of a weaker Australian Dollar on input costs resulted in a 320bps decrease in the gross profit margin to 58.9%. Whilst expenses were well controlled, decreasing by 1.3%, the impact of a weaker topline and the business's temporarily higher cost base post the David Jones separation, resulted in significant negative operational leverage in the period. Adjusted operating profit of A$14.2 million decreased by 71.7%, returning an operating profit margin of 2.6%.
OUTLOOK
Notwithstanding signs of improving consumer confidence across both geographies, recent positions taken by the USA regarding global trade relations have elevated the forecast risk with regards to the macro-economic outlook for the current year, particularly in the case of South Africa.
In Australia, whilst a gradual recovery in GDP growth, alongside easing monetary policy is expected, the retail sector is likely to remain highly promotional until such time as the pressures of living costs ease. During the second half of the financial year, we will undertake a reassessment of the carrying value of the assets of our underperforming brands within the Country Road Group. This exercise will give due consideration to the macroeconomic environment, our strategic plans and our reset operating model.
Notwithstanding the potential impact of external factors across both our geographies, we are confident in our ability to achieve our strategic objectives, and are well-positioned to benefit from any cyclical recovery in consumer spending.
They Said It
"Oh, did I give you my OWN cell number?" - Rob Cattell, Cattell’s Industrial Footwear cc, Springs, Gauteng, SA. He’d meant to give me contact details for his son, Raymond, who now runs the business.
"On the 5th of July, I’ll have been with Paul Moeller for 42 years…and they’ve regretted it ever since. So has my wife – and my bank manager also." - Holger Stutz, Paul Moeller & Co., Johannesburg, Gauteng, SA. He was joking, I’m pretty sure.
Got anything you'd like to share?
Do you have any suggestions, comments or experiences about the industry that you'd like to share with the industry? - tony@svmag.co.za
New subscribers last week
Tim, Designer/Developer, Cape Union Mart, Cape Town, South Africa
Heinrich, Taxidermy Studio & Tannery, Otjiwarongo, Namibia
Meshal Erispe, Footwear Technologist, Pep, Cape Town, South Africa
Nicky, Director, Shoet3ch Consumables, South Africa
Birthdays this week
10/03/1951: Mrs M Balakrishnan, Malar Industries, Ndola, Zambia.
10/03/1958: Nigel Dunning, retired, formerly Mimosa Extract Co., Pietermaritzburg, KZN, SA.
11/03/1956: Sarah Gedye, Michelle Footwear, Durban, KZN, SA.
11/03/1959: André Meyer, Green Cross, Bloemfontein, Free State, SA.
11/03/1968: Brett Laing, Grounded, Cape Town. W. Cape, SA.
12/03/1937: Alastair MacGregor, retired, formerly Colin D. Bailey [absorbed by BU Technical, since closed], Port Elizabeth, E. Cape, SA.
12/03/1966: Matthew Hansen, CL Hansen Agencies, Durban, KZN, SA.
12/03/1967: Shenaz Desai, Fashion Feet, KwaDukuza/Stanger, KZN, SA.
12/03/1988: Mohamed Yaseen Jeewa, Traford Footwear, Durban, KZN, SA.
13/03/1959: Salim Moosajee, Seltex, Johannesburg, Gauteng, SA.
13/03/1964: Albert Dale, AFD Industries, Pretoria, Gauteng, SA.
13/03/1965: Eleugene Human, Johnson Controls SA, Uitenhage, E. Cape, SA.
13/03/1966: Ebrahim Shaikh, Kinkle Investments t/a Shoe Lala, Durban, KZN, SA.
13/03/1977: Sarah Chapman, designer, Durban, KZN, SA.
13/03/1981: Colin Muir, emigrated, formerly Pasacojo Marketing Services, Port Elizabeth, E. Cape, SA.
14/03/1958: Berno Dumas, Bolton Footwear, Great Brak River, W. Cape, SA.
14/03/1966: Silvan Pillay, Shoe Biz, Pretoria, Gauteng, SA.
15/03/1960: Judy Friend, Safari Leathers, Bulawayo, Zimbabwe.
15/03/1965: Neil Solomons, Bolton Footwear, Cape Town, W. Cape, SA.
15/03/1972: Vanyo Mangaliso, Sun Goddess, Johannesburg, Gauteng, SA.
15/03/1973: Jacky Hay, Little Slipper Co., Port Elizabeth, E. Cape, SA.
15/03/1974: Tim Pittaway, Ostrich Emporium, Port Elizabeth, E. Cape, SA.
16/03/1952: Douglas B. Bornman, Texstyles Import & Export cc, Johannesburg, Gauteng, SA.
16/03/1961: Doc Motala, Crown Footwear, Pinetown, KZN, SA.
16/03/1965: Rod Bloom, Barksole Shoe & Bag Repairs, Cape Town, Cape Town, W. Cape, SA.
16/03/1979: Matthew Boltman, Noo Shoes, Pretoria, Gauteng, SA.
16/03/1987: Pankaj Mistry, Superstar Fashions, Vereeniging, Gauteng, SA.
In memoriam this week
10/03/2017: Kevin 'Tubby' Hannaford (b. 05/11/1949), Moulded Footwear Components [closed], Durban, KZN, SA.
11/03/1993: Doug Roberts, Clarks SA/Kingsley Shoes [both closed], Pietermaritzburg, KZN, SA.
11/03/2005: Des Orme, (b. 27/11/1924), Panama Shoes [closed], Durban, KZN, SA.
11/03/2013: Donald Henry Gough (b. 02/07/1922), Barker Footwear [now Bolton Footwear]/FMF [now SAFLIA], Cape Town, W. Cape, SA.
11/03/2024: Doug Patterson-Roberts (b. 06/06/1943), Kronies Footwear and Shoe Boyz in Pinetown, and Marchez Shoe Salon, Shelly Beach, [all closed], KZN, SA.
13/03/1997: Denis Kalil, Payless Shoes [closed], Durban, KZN, SA.
14/03/1988: John Begg, BU Shoe Machinery [closed], Port Elizabeth, E. Cape, SA.
14/03/2024: Mike Sayer (b. 05/11/1943), BEC Sales, Cape Town, W. Cape, SA.
16/03/2008: Tilly Amery, FISA [closed], Durban, KZN, SA.
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.
Directory entries updated last week
Buckman Africa, Hammarsdale, KZN, SA.
Cruz Footwear (Pty) Ltd, Durban, KZN, SA.
Good Hope Sales (Pty) Ltd t/a Going Under and Ritewear Trading, Cape Town, W. Cape, SA.
Shoe Zone cc, Lenasia, Gauteng, SA.
Shoez Group (Pty) Ltd, Lenasia, Gauteng, SA.
Shoet3ch Consumables (Pty) Ltd, Pinetown, KZN, SA.
Studla Footwear (Pty) Ltd, Pinetown, KZN, SA.
The Little Slipper Company [Fast Fox Footwear (Pty) Ltd], Port Elizabeth, E. Cape, SA.
 
Exchange rates
Note: For previous rates, see HERE
1. SA Rand (ZAR)/Lesotho Loti (LSL)/Namibian Dollar (NAD)/Swazi Lilangeni (SZL)
Source: http://www.x-rates.com/calculator/
| |
Euro € |
GBP £ |
US $ |
CNY ¥ |
| 04/01/2025 |
R19.31 |
R23.26 |
R18.72 |
R2.55 |
| 11/01/2025 |
R19.57 |
R23.32 |
R19.10 |
R2.60 |
| 18/01/2025 |
R19.25 |
R22.81 |
R18.73 |
R2.55 |
| 25/01/2025 |
R19.30 |
R22.95 |
R18.39 |
R2.53 |
| 01/02/2025 |
R19.35 |
R23.13 |
R18.67 |
R 2.57 |
| 08/02/2025 |
R19.01 |
R22.83 |
R18.40 |
R 2.52 |
| 15/02/2025 |
R19.25 |
R22.09 |
R18.35 |
R 2.52 |
| 22/02/2025 |
R19.20 |
R23.19 |
R18.35 |
R 2.53 |
| 01/03/2025 |
R19.38 |
R23.50 |
R18.68 |
R 2.56 |
| 08/03/2025 |
R19.73 |
R23.53 |
R18.22 |
R 2.52 |
2. Botswana Pula
Source: http://www.x-rates.com/calculator/
| |
Euro € |
GBP £ |
US $ |
CNY ¥ |
| 04/01/2025 |
14.39 |
17.33 |
13.95 |
1.90 |
| 11/01/2025 |
14.25 |
16.98 |
13.91 |
1.89 |
| 18/01/2025 |
14.39 |
17.05 |
14.00 |
1.91 |
| 25/01/2025 |
14.50 |
17.24 |
13.82 |
1.90 |
| 01/02/2025 |
14.41 |
17.23 |
13.90 |
1.91 |
| 08/02/2025 |
14.50 |
17.42 |
14.04 |
1.92 |
| 15/02/2025 |
14.51 |
17.41 |
13.83 |
1.90 |
| 22/02/2025 |
14.40 |
17.40 |
13.77 |
1.89 |
| 01/03/2025 |
14.29 |
17.32 |
13.77 |
1.89 |
| 08/03/2025 |
14.78 |
17.63 |
13.65 |
1.88 |
3. Malawian Kwacha (MWK) (buying)
Source: https://www.rbm.mw/
| |
Euro € |
GBP £ |
US $ |
ZAR |
| 04/01/2025 |
1816.63 |
2191.92 |
1717.02 |
94.59 |
| 11/01/2025 |
1819.29 |
2171.58 |
1717.02 |
93.34 |
| 18/01/2025 |
1820.17 |
2159.73 |
1717.02 |
94.18 |
| 25/01/2025 |
1848.47 |
2193.86 |
1717.02 |
96.09 |
| 01/02/2025 |
1837.33 |
2196.51 |
1717.02 |
95.29 |
| 08/02/2025 |
1835.03 |
2197.40 |
1717.02 |
95.78 |
| 15/02/2025 |
1848.82 |
2119.86 |
1717.02 |
95.70 |
| 22/02/2025 |
1854.83 |
2238.78 |
1717.02 |
96.30 |
| 01/03/2025 |
1836.44 |
2224.46 |
1717.02 |
95.68 |
| 08/03/2025 |
1912.31 |
2278.93 |
1717.02 |
97.50 |
4. Zambian Kwacha (ZMW) (buying)
Source: https://www.boz.zm/
| |
Euro € |
GBP £ |
US $ |
ZAR |
| 04/01/2025 |
28.75 |
34.65 |
27.93 |
1.48 |
| 11/01/2025 |
28.66 |
34.25 |
27.81 |
1.46 |
| 18/01/2025 |
28.64 |
33.90 |
27.82 |
1.48 |
| 25/01/2025 |
29.15 |
34.54 |
27.84 |
1.51 |
| 01/02/2025 |
29.09 |
34.80 |
28.01 |
1.30 |
| 08/02/2025 |
29.13 |
34.94 |
28.07 |
1.52 |
| 15/02/2025 |
29.47 |
35.42 |
28.13 |
1.53 |
| 22/02/2025 |
29.58 |
35.73 |
28.26 |
1.53 |
| 01/03/2025 |
29.67 |
35.91 |
28.51 |
1.54 |
| 08/03/2025 |
31.07 |
36.95 |
28.59 |
1.57 |
5. Zimbabwe Gold (ZiG)
Source: Source: https://www.rbz.co.zw/
| |
Euro € |
GBP £ |
US$ |
ZAR |
| 04/01/2025 |
ZIG 26.52 |
ZIG 32.01 |
ZIG 25.82 |
ZIG 0.72 |
| 11/01/2025 |
ZIG 26.83 |
ZIG 32.03 |
ZIG 26.05 |
ZIG 0.72 |
| 18/01/2025 |
ZIG 27.03 |
ZIG 32.09 |
ZIG 26.26 |
ZIG 0.71 |
| 25/01/2025 |
ZIG 27.47 |
ZIG 32.58 |
ZIG 26.30 |
ZIG 0.70 |
| 01/02/2025 |
ZIG 27.38 |
ZIG 32.74 |
ZIG 26.36 |
ZIG 0.70 |
| 08/02/2025 |
ZIG 27.40 |
ZIG 32.81 |
ZIG 26.40 |
ZIG 0.69 |
| 15/02/2025 |
ZIG 27.62 |
ZIG 33.18 |
ZIG 26.43 |
ZIG 0.69 |
| 22/02/2025 |
ZIG 27.60 |
ZIG 33.33 |
ZIG 26.46 |
ZIG 0.69 |
| 01/03/2025 |
ZIG 27.59 |
ZIG 33.42 |
ZIG 26.56 |
ZIG 0.69 |
| 08/03/2025 |
ZIG 28.79 |
ZIG 34.32 |
ZIG 26.64 |
ZIG 0.68 |
Note: For previous rates, see HERE
ABSA Agri Trends: Hides & skins prices
Johannesburg, Gauteng, SA (06 March 2024) – The current average hide price decreased by 0.80% to R2.773/kg from R2.796/kg a week ago. The current price is 0.74% lower than the average price a month ago and was 15.5% lower than the average price a year ago. The range of prices reported was as follows: Minimum price: R2.66 Maximum price: R3.00. Please note: Our methodology weighs the prices we collect according to the number of hides they sell in a month. This is done to make it more representative of the prevailing market price. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies. - Marlene Louw, senior agricultural economist, Nkhensani Mashimbyi, agricultural economist, and Zama Sangweni, agricultural economist, ABSA group.
Note: For previous prices, see HERE
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:
Grand Shoe, Durban, KZN, SA. Women’s shoe retailer.
Grand Uniforms, Durban, KZN, SA. Workwear, uniform and corporate clothing manufacturer.
THIS WEEK LAST YEAR!
Major fire at Berzacks KZN premises
After better than expected back-to-school, sales have plateaued
Truworths International Ltd: Unaudited group interim results
READ IT HERE - S&V Weekly Newsletter Vol.10 No.11, March 11 2024
THIS WEEK FIVE YEARS AGO!!
Coast 2 Coast rescue plan to be announced soon
Retail so far this year
3rd Arsutoria trend workshop
READ IT HERE - S&V Weekly Newsletter Vol.6 No.10, March 9, 2020
Contact us
News & Classifieds: Tony Dickson, +27 (0)31 209 7505, tony@svmag.co.za
Next newsletter: Monday 17 March, 2025. Ad and editorial deadline Friday 14 February.
SAFLIA enquiries: Tel 0800SAFLIA * Email info@saflia.co.za * Website http://www.saflia.co.za
Our website www.svmag.co.za
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