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TRUWORTHS INTERNATIONAL LIMITED - Business update

Release Date: 24/10/2018 09:45
Code(s): TRU     PDF:  
 
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Business update

Truworths International Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1944/017491/06)
JSE Code: TRU
NSX Code: TRW
ISIN: ZAE000028296

BUSINESS UPDATE

Truworths International Limited (the ‘Group’) announces that retail sales for the first 16
trading weeks (2 July 2018 to 21 October 2018) of the 2019 financial period (‘the current
period’) increased by 4.5%# to R5.3 billion compared to R5.1 billion for the first 16 trading
weeks (3 July 2017 to 22 October 2017) of the 2018 financial period (‘the prior period’).

Account sales comprised 50% (2018: 50%) of Group retail sales for the current period, with
account and cash sales increasing by 4.9%# and 4.1%# respectively relative to the prior
period.

Retail sales for Truworths (being the Group, excluding the UK-based Office segment)
increased by 3.6%# to R3.8 billion relative to the prior period’s R3.7 billion. Account sales
comprised 70% of these retail sales (2018: 69%). Trading space increased by 1.9% on the
prior period and is expected to increase between 2% and 3% for the full 2019 financial
period. Comparable product deflation (i.e. excluding Loads of Living acquired in October
2017) averaged 1.1% for the current period.

Retail sales for the Group’s UK-based Office segment increased in Sterling terms by 0.5% to
£83.3 million relative to £82.9 million for the prior period. In Rand terms however, retail
sales for Office increased by 6.7% to R1.5 billion, aided by Rand weakness. Trading space
decreased by 1.0% on the prior period and is expected to remain at this level for the full
2019 financial period.

The Group’s gross trade receivables* at the end of the September 2018 retail period
decreased by 2.3% to R5.5 billion compared to R5.7 billion at the end of the September
2017 retail period. The number of active accounts increased by 3% relative to the
September 2017 retail period-end, while the percentage of active account holders able to
purchase and overdue balances as a percentage of gross trade receivables remained
unchanged at 85% and 13% respectively.

Although the trading environment is expected to remain challenging, the Group will continue
to utilise its extensive experience to manage the risk of fashion through its proven
merchandise design and buying processes and manage the risk of the book through
continuing to apply strategies to ensure the on-going health of the portfolio.

Shareholders are advised that this business update does not constitute an earnings forecast,
that the financial information provided herein is the responsibility of the directors, and that
such information has neither been reviewed nor reported on by the Group’s external
auditors. The Group’s interim results for the 26-week period ending 30 December 2018 are
scheduled for release on or about Thursday, 21 February 2019.


# The end-of-winter-season sale commenced in week 1 of the current period, unlike the
  prior period when the end-of-winter-season sale commenced in week 53 of the 2017
  reporting period. Accordingly, the first 16 weeks’ trading of the current period is not
  directly comparable to the first 16 weeks’ trading of the prior period.


* All trade receivables information is as at the end of the Group’s September 2018 retail
  period, which ended on 30 September 2018. Comparative trade receivables information is
  as at the end of the September 2017 retail period, which ended on 1 October 2017.



24 October 2018
Cape Town

JSE Sponsor: One Capital
NSX Sponsor: Merchantec Capital Namibia (Pty) Ltd

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