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TRUWORTHS INTERNATIONAL LIMITED - Trading update for the 26-week period ended 30 December 2018

Release Date: 17/01/2019 16:30
Code(s): TRU     PDF:  
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Trading update for the 26-week period ended 30 December 2018

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


Retail sales of Truworths International Limited (the ‘Group’) for the 26-week period ended 30
December 2018 (the ‘current period’) increased by 2.0%# to R10.5 billion relative to the R10.3
billion reported for the 26-week period ended 31 December 2017 (the ‘prior period’).

Account sales comprised 51% (2017: 50%) of Group retail sales for the current period, with
account and cash sales increasing by 3.7%# and 0.3%# respectively, relative to the prior

Retail sales for Truworths Africa (being the Group, excluding the UK-based Office segment
and comprising mainly of the Truworths businesses in South Africa) increased by 2.4%# to
R7.6 billion relative to the prior period’s R7.4 billion, with account sales increasing by 3.7%
and cash sales decreasing by 0.4%. Account sales comprised 70% of these retail sales
(2017: 69%). Like-for-like store retail sales remained unchanged relative to the prior period.
Trading space in Truworths Africa increased by 1.0% on the prior period and is expected to
increase by approximately 2% for the full 2019 financial period. Product deflation averaged
1.5% for the current period. Truworths Africa successfully implemented our new lay-bye
offering and an e-commerce platform during calendar 2018.

Retail sales for the Group’s UK-based Office segment decreased in Sterling terms by 3.0% to
£157 million relative to the prior period’s £162 million. In Rand terms however, retail sales
for Office increased by 0.8% to R2.9 billion. The Office segment continued to show strong
online performance, with online retail sales growing at 7.2% and comprising approximately
33% of retail sales for the current period. Trading space for the Office segment decreased by
2.7% on the prior period and is expected to decrease by approximately 5% for the full 2019
financial period.

Gross trade receivables in respect of the Truworths Africa debtors book (relating to the
Truworths, Identity and YDE businesses) were at R6.4 billion (2017: R6.3 billion), while the
number of active accounts increased by 4.0% to 2.7 million. Active account holders able to
purchase and overdue balances as a percentage of gross trade receivables were at 86% and
10% respectively.

The Group’s diluted headline earnings per share (‘HEPS’) for the current period are estimated
to decrease by between 5% and 7% to between 352.7 cents and 360.3 cents relative to the
diluted HEPS of 379.3 cents reported for the prior period.

The Group continued to experience difficult trading conditions in both its main markets. Low
economic growth, high unemployment, modest increases in negotiated wages and higher
average fuel and utility prices contributed to low consumer confidence and constrained
spending in South Africa, while Brexit uncertainty continues to negatively impact the UK

Shareholders are advised that this trading 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 ended 30 December 2018 are scheduled
for release on or about Thursday, 21 February 2019.

#  In Truworths Africa the end-of-winter-season sale commenced in week 1 of the current
   period, whereas it commenced in week 53 of the 2017 reporting period, and hence did not
   occur in the prior period. Accordingly, the 26 weeks’ trading of the current period is not
   directly comparable to the 26 weeks’ trading of the prior period.

17 January 2019
Cape Town

JSE Sponsor: One Capital
NSX Sponsor: Merchantec Capital Namibia Proprietary Limited

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