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MR PRICE GROUP LIMITED - Trading update to 26 August 2017

Release Date: 01/09/2017 07:06
Code(s): MRP     PDF:  
Wrap Text
Trading update to 26 August 2017

Mr Price Group Limited
Registration number 1933/004418/06
Incorporated in the Republic of South Africa
ISIN: ZAE 000026951
JSE share code: MRP
("Mr Price" or "the company" or "the group")

TRADING UPDATE TO 26 AUGUST 2017

Shareholders are advised that, in the first four months (18 weeks
to 5 August 2017) of the financial year ending 31 March 2018,
retail sales grew by 6.2% to R6.5bn as follows:


                        Total    Comparable                    RSP
                        Sales   Store Sales     Units    Inflation
Apparel Segment
MRP                      9.0%          7.0%      6.2%         3.0%
MRP Sport                2.1%         -4.5%      0.3%         1.8%
Miladys                 13.5%         12.3%      3.6%         9.5%
                         8.7%          6.4%      5.6%         3.2%
Home Segment
MRP Home                -2.1%         -4.1%     -2.8%         1.0%
Sheet Street             1.7%          0.5%     -2.9%         4.8%
                        -1.0%         -2.7%     -2.8%         2.1%
Group                    6.2%          4.0%      3.5%         2.9%


As reported at the year-end results presentation in May 2017, given
the current low growth economy and resultant poor retail
environment, the most significant near-term opportunity is to
regain lost market share in the two divisions, MRP Apparel and
Miladys, which underperformed in the previous financial year.
Despite intensified competitor promotional activity, our focused
efforts are proving successful. The combined South African sales
growth of MRP Apparel and Milady’s from April to June 2017 was
10.1%, which compares favourably to Type D retailers (textiles,
clothing, footwear and leather goods), as reported by STATS SA,
which grew 4.8% over the same period.

With their improved trading and inventory performance, these two
divisions are expected to contribute positively to the group’s
anticipated improvement in gross profit margin for the first half
ending 30 September 2017.
The merchandise offers in MRP Sport and the homewares chains are
a more discretionary buy. Despite constrained consumers reducing
their spend in these categories, our level of execution and value
proposition remains strong.

Online sales were 6.4% higher. MRP Sport and MRP Home growth
tracked physical store sales growth, while MRP Apparel recorded
growth of 20.1%.

Group cash sales increased 6.3%, constituting 82.6% (LY: 82.4%) of
total sales and credit sales increased 5.4%. Weighted average
trading space was 2.6% higher.

Other income grew by 3.4%, to R372.0m. Debtors’ interest and fees
grew 7.7% and insurance revenue 18.0%. The temporary slowdown in
cellular revenue growth (-8.1%) resulting from a focus on process
improvements and product mix changes is expected to have a positive
impact on profitability.

Total retail sales and other income grew 6.0% to R6.9bn.

Retail sales for the three-week period from 6 to 26 August 2017,
not included in the analysis above, were up 6.8% and comparable
store sales 4.8%. Divisional performance was similar to the table
reflected above.

The information contained in this announcement has not been
reviewed and reported on by the company's external auditors.

Durban
1 September 2017

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

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