Mr Price To Battle Tough Times With Value Offer

Business Report:

Retail group Mr Price has reported a 15% increase in diluted headline earnings per share to 210.8 cents for the year ended March 2008 from 183.6 cents a year ago.

A final cash dividend of 79.5 cents per share was declared. Retail sales were up 19% to R7.421 billion, while operating profit was 17% higher at R716.2 million.

Chief executive Alastair McArthur said the group was able to weather the tougher conditions because of its appeal as a value retailer and its predominantly cash formula.

‘Our established apparel chains which represent the bulk of our business have performed exceptionally. The home businesses have had more difficulty but are adapting to the changed conditions. Our trading space reached half a million square metres, we created nearly 700 new jobs during the year and our franchising business has taken off very well.’

McArthur said the buoyant economic environment that has been enjoyed by retailers in recent years has ended, as consumers have been hard hit by increases in interest rates, food and fuel prices as well as property rates, all of which have led to decreased spending, particularly on durable and semi-durable products. The effect was more marked in the second half of the year, he said.

Read more.