Home / Knowledge / News / Apparel/Garments / Fashion retailer Mr Price Group H1 sales surge 14.6%
Fashion retailer Mr Price Group H1 sales surge 14.6%
15
Nov '13
Cash retailer Mr Price Group announced that its tried and tested fashion- value retailing formula had resulted in strong sales growth and operating profit, headline earnings and dividend per share all increasing by more than 20%. The performance is against a backdrop of low consumer confidence in a challenging retail environment, caused by slowing real wage and credit growth.

Retail sales for the 26 weeks ended 28 September 2013 increased by 14.6% to R6.9 billion. Sales in like-for-like locations (comparable sales) were up by 9.6%. For the five months to August 2013, as reported by Stats SA, total retail sales growth was 7.3% and retailers in textiles clothing and footwear was 10.6%.

“We focused on avoiding chasing credit sales to drive top-line growth and are pleased that cash sales growth of 15.1% exceeded credit sales growth of 11.6%. We have been loyal to our cash model and 79.2% of total sales were for cash,” said CEO Stuart Bird.

“Despite tapping-off on credit, our largest chain, Mr Price Apparel, which represents 55.5% of Group sales, achieved strong market share gains, which is proof that our merchandise offer hit the mark,” added Bird.

A weak currency, which affects all retailers, resulted in retail selling price inflation increasing by 8.3% and units sold increased by 5.8% to over 97.5 million units. The opening of 24 new and the closing of 12 stores resulted in net closing trading space increasing by 3.1% (September 2012 to September 2013).

“Although ongoing space rationalisation (closures and space reductions) continues to favourably impact profitability, we are still focused on adding good quality space (new stores and expansions) and new trading space added increased by 6.0%,” said Bird.

Other income increased by 22.6% as a result of interest on trade receivables rising by 20.6%, while financial services premium income was up by 43.0% and represents an ongoing growth opportunity.

The gross profit margin increased from 41.3% to 41.7% of retail sales. Selling and administrative expenses grew by 13.4%, a level below the increase in sales despite space growth, increased bad debts and investment costs being incurred to position the Group for future growth, which include:

E-commerce – Mr Price Apparel opening MRP.COM to international markets and Mr Price Home and Sheet Street building capacity to launch their local sites before the festive season;

Human capital management systems – a full HR suite which has resource scheduling as a core component to ensure that staff levels are commensurate with trading demands; and

ERP – the conversion from legacy systems to Oracle, with the implementation of the first trading division planned for mid-2014.

The Group has opened two new stores in Nigeria in the last six months, bringing the total to four. “We no longer view Nigeria and Ghana as test markets. Although a more efficient supply chain will in time enable us to lower selling prices and be very competitive in those markets, they are currently performing well and confirm their potential,” said Bird. “In addition, the online sales platform will represent a strong growth opportunity globally and will allow a cost effective test of foreign markets,” he added.

Click here to read full results

Mr Price Group

Must ReadView All

Courtesy: Myntra

Apparel/Garments | On 3rd Dec 2016

Myntra to be EBITA positive by FY18: CEO Narayanan

Myntra is on track to achieve sustainable growth and be EBITA...

Courtesy: India ITME Society

Textiles | On 3rd Dec 2016

India ITME 2016 opens with over 1050 exhibitors

The India International Textile Machinery Exhibition (India ITME)...

Courtesy: Bruckner

Textiles | On 3rd Dec 2016

Indian textile companies opt for Brückner stenter lines

Indian textile firms Laxmipati Sarees, makers of polyester sarees and ...

Interviews View All

Anvita Mehra
Confidential Couture

‘It is going to take some time for Indian buyers to get accustomed to...

Karel Williams
Dow Microbial Control

'Silvadur is most rapidly adopted in areas where hygiene-conscious and...

Sunil Rathore
Lacoste India

‘New vendor is welcome if he offers cost, quality and timely delivery’

Steve Cole
Xerium Technologies

Steve Cole of Xerium Technologies discusses the industry. Xerium is the...

Marcel Alberts
Eurofibers

Coating at a fibre level is a practice not usually seen in the...

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Karan Arora
Karan Arora

Bridal couture created with rich Indian heritage, exquisite craftsmanship...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
December 2016

December 2016

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


Advanced Search