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Truworths profit up, eyes Africa expansion
Truworths profit up, eyes Africa expansion

Truworths profit up, eyes Africa expansion


Fin24 - Feb 24th 2012, 07:41

Johannesburg - South Africa's biggest listed clothes retailer Truworths International [JSE:TRU] reported a 14% increase in first-half profit, lifted by higher prices and new stores. 

Truworths, which runs fashion stores of the same name across the country, said diluted headline earnings per share totalled 272.3 cents in the six months to end-December, compared with 238c a year earlier.

Consumer spending is improving in Africa's top economy thanks to decades-low interest rates and above-inflation wage increases, but the outlook is uncertain due to high personal debt levels and chronic unemployment.

South African retail sales jumped 8.7% year-on-year in December, beating the 6.5% growth economists had expected.

Cape Town-based Truworths said sales increased 11% to R4.8bn, with product inflation of 8% and after adding 14 stores during the period.

The company said sales in the first eight weeks of the second half showed an 11% growth on the same time a year earlier.

Truworths, which runs 21 stores in African countries outside South Africa, said it would open 13 stores at its home market and six in the rest of the continent in the next six months.

Retailers in Africa's biggest economy are increasingly setting up shops on the poor but fast-growing continent, whose consumption prospects were highlighted by US retail giant Walmart's acquisition of South African retailer Massmart last year.  

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