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A shopper pushes a trolley outside a branch of South African clothing and homeware retailer Mr Price, at the Trade Route Mall, in Lenasia outside Johannesburg, South Africa, February 8, 2023. REUTERS/Siphiwe Sibeko Acquire Licensing Rights
JOHANNESBURG, Nov 23 (Reuters) – South African budget fashion retailer Mr Price (MRPJ.J) reported on Thursday a 9.3% decline in half-year profit, hit by elevated levels of power cuts and as double-digit inflation in food and transport impacted its value customers more severely.
It reported headline earnings per share, a profit measure, of 449.9 cents for the 26 weeks ended Sept. 30, down from 496 cents a year earlier.
Retailers in South Africa have been impacted by rolling power blackouts, sometimes lasting up to 10 hours a day, which have reduced trading hours and added the cost of running diesel generators.
Mr Price, which also sells homewares, said blackouts were four times higher in the first quarter than the same period in the prior year.
It spent 140 million rand ($7.62 million) to accelerate its back-up power solutions, which by the end of the first quarter had completely covered its core business compared with only 60% of its store base at the start of the quarter.
The group estimates a loss of 60,000 trading hours from power cuts, equivalent to about 190 million rand in revenue in the half year.
Group revenue grew 26.4% to 16.8 billion rand, with retail sales growth of 27.8%, helped by the acquisition of branded footwear and clothing company Studio 88.
Excluding Studio 88, retail sales grew 3.8% and comparable store sales fell 0.8% in the half year.
($1 = 18.3689 rand)
Reporting by Nqobile Dludla; Editing by Jacqueline Wong and Mrigank Dhaniwala
Our Standards: The Thomson Reuters Trust Principles.
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