JOHANNESBURG Jan 12 South African clothing
retailer Truworths International expects lower
half-year profit as in-store credit sales stalled due to tougher
regulations, the firm said on Thursday.
Truworths said diluted headline earnings per share for the
26 weeks to 25 December will decrease to between 380.6 cents and
397.9 cents per share, up to 6 percent lower than in the
corresponding period in 2015.
The firm said new credit affordability assessment
regulations - rules introduced by South Africa in 2015 that
require banking statements and proof of income - weighed on
South African clothing and furniture retailers rely heavily
on in-store credit cards to boost sales in a sluggish economy.
Truworths said its total retail sales rose 21 percent to
10.2 billion rand ($756 million), but cash sales accounted for
all of the growth, while credit sales remained unchanged.
"Increased pressure on consumers from rising inflation,
especially in food prices, and a weak employment market
characterised by job losses and soft real growth in incomes have
also impacted the Group's performance," Truworths said in a
The trading update was released after the close of trading
on the JSE.
($1 = 13.4884 rand)
(Reporting by TJ Strydom; editing by Joe Brock)