Pepkor Holdings is continuing to trade well after its March year-end
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Pepkor Holdings said yesterday that positive trading momentum had continued in all its business post the March 31 year-end and some 22 new stores would be added this year. Photo: Supplied
CAPE TOWN - PEPKOR Holdings said yesterday that positive trading momentum had continued in all its business post the March 31 year-end and some 22 new stores would be added this year.
The group, a value retailer of clothing, footwear and homeware (CFH), as well as furniture and consumer digital equipment and accessories, lifted headline earnings per share of continuing operations by a whopping 50.6 percent during the six months to March 31.
Investors took heart at the good results, and the share price was up 4.55 percent to R18.60 yesterday morning, far outstripping the 0.39 percent rise in the JSE All Share Index at the same time.
The share closed the day at R19.39 on the JSE.
Revenue was up 8.1 percent to R36.5 billion, and some R5bn of cash was generated through the period. Net debt reduced substantially by R8bn to R6.1bn. One hundred and eight new stores were opened. There were 5 293 stores at March 31.
“The Pepkor group continued to outperform and expand its market share in a challenging and uncertain South African consumer retail market. Strong operational performance in addition to a significantly lower level of debt resulted in Pepkor growing headline earnings per share by 50.6 percent,” the group’s management said.
Leadership in the discount and value market and the execution of proven customer value propositions had resulted in significant market share expansion in CFH, cellular handsets and consumer electronics and appliances, the group said.
Ninety-three percent of group sales through the period was done in cash. @mommy_moneyza, a South African “mom” with daughters, said on Twitter yesterday that Ackermans was the “undisputed” market leader in baby and children’s clothing. Pepkor’s fintech businesses, consisting of Flash and Capfin, reported a 68.8 percent rise in operating profit to R336m.
Pepkor’s Flash business had continued double-digit revenue growth as it invested in new products and technology and empowered 196 000 traders to grow their businesses.
Pepkor said all businesses in the group contributed positively to the results for the period.
Operating conditions had been volatile in the second wave of the pandemic and disruptions caused by a delayed start to the academic school year.
The performance was also commendable in that it was measured against the six-month period ended March 31 and was largely unaffected by Covid-19, the group said.
Pepkor raised R2.2bn in three- and five-year bonds issued on May 5, under its R10bn domestic medium-term note programme.
The proceeds from the issuance were used to replace existing term debt funding due for repayment in 2022.
A transaction to acquire 12 properties leased from Steinhoff International Holdings NV received the necessary approvals and the group would issue 70 million new Pepkor shares as consideration, or 1.9 percent of the total Pepkor shares in issue.
BUSINESS REPORT