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Trading update for third quarter (Q3 FY2013)
Mr Price Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1933/004418/06)
ISIN: ZAE000026951
Share Code: MPC
("Mr Price Group" or "the Group" or "the Company")
TRADING UPDATE FOR THIRD QUARTER (Q3 FY2013)
During the third quarter (30 September 2012 to 29 December 2012) of
the financial year ending 30 March 2013, Mr Price Group recorded
sales growth of 10.0% over the corresponding period in the prior
year (2 October 2011 to 31 December 2011). Comparable store sales
increased by 4.4%.
Retail selling price inflation for the period was 4.8% and cash
sales constituted 78.8% of total sales(LY: 80.1%). Weighted average
trading space increased by 3.4%. During the quarter the Group opened
32 and closed 2 stores, adding a net 12 294 square metres to its
trading area and ended with 1 019 stores.
The Apparel Division (Mr Price, Mr Price Sport and Miladys), which
represented 73.3% of sales(LY: 73.9%), achieved sales growth of 9.1%
with comparable store sales growth of 2.9%. The division opened 19
stores (Mr Price Apparel 14, Mr Price Sport 4 and Miladys 1) and
weighted average trading space increased by 4.4%. Retail selling
price inflation of 3.9% was recorded.
The Home Division (Mr Price Home and Sheet Street) achieved sales
growth of 12.6% and comparable store sales growth of 8.8%. The
division opened 13 stores (Mr Price Home 6 and Sheet Street 7) and
weighted average trading space increased by 1.5%. Retail selling
price inflation of 7.6% was recorded.
The gross profit margin increased over the corresponding prior
period and collections from debtors were in line with expectations.
As anticipated, sales performance for the quarter was impacted by
the planned curtailment of credit sales growth. In the third quarter
of the prior year, unsecured credit granted in South Africa
increased by 57.1%. With the Group’s intention to remain a cash-
based retailer and the downside risks currently associated with
unsecured credit, a decision was taken to slow credit sales growth
off the high base. As a result, the growth in Group credit sales in
the current reporting period slowed considerably. This impacted the
Mr Price Apparel chain in particular, which also experienced the
under-delivery of certain key categories of merchandise in October
and November.
The Group is targeting an improved sales performance in the fourth
quarter of the year due to an improved stock position and a base
period which included lower credit sales growth. Sales for the
period 30 December 2012 to 16 January 2013, which are not included
in the commentary above, reflect an increase of 17.2% over the prior
period, with comparable store sales increasing by 11.7%.
The above-mentioned figures do not constitute an earnings forecast
and have not been reviewed and reported on by the Company’s external
auditors.
Durban
17 January 2013
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
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