TFG’s share buybacks and revenue growth amid declining profits

THE Foschini Group (TFG) share price was among the biggest losers on the JSE Friday, falling by 5.3% after it reported weak trading conditions that saw its interim dividend lowered by 18.8% to 130 cents a share.

- EDWARD WEST

The share price traded at R85.55 on Friday afternoon, a price already well down from the R154.23 that it traded at a year before. The lower dividend was even though the group managed to increase revenue by 12.2% to R31.4 billion, supported by the inclusion of White Stuff in the UK - acquired late October 2024 - and growth in TFG Africa.

The group's management took advantage of the lower share price during the period, which they said was trading at a discount to intrinsic value, and 3.42 million shares were repurchased for R377 million.

Online sales rose strongly by 55.3%, contributing 14.7% of total group sales. Operating profit declined 9.9% to R2.3bn, which management said reflected persistent macroeconomic pressures and higher promotional intensity across winter months.

"The macro environment has been tough for longer than anyone anticipated. June and September were particularly difficult months across our markets.

In these conditions, we are focused on taking firm, practical steps to maintain financial discipline, improve efficiency and ensure our key growth areas continue to develop," said Anthony Thunström, TFG's CEO.