Truworths sales up, shares surge
South Africa's biggest-listed apparel retailer, Truworths International Ltd, reported a 16 percent jump in sales for the first 18 weeks of its financial year on Thursday, lifting its shares.
Truworths, which sells middle and high-end clothing in cash and on credit, said sales totalled 3.3 billion rand ($381.43 million) in the 18 weeks to end-November 4, an increase of 16 percent.
Growth was boosted in part by new stores, which added 7.4 percent to the company's trading space. Same store sales were up 10.7 percent.
Shares in the $5.2 billion company rose 4.9 percent to 99 rand by 11:03 SA time, on track for their biggest daily percentage gain in a year and outperforming a slightly higher JSE Top-40 index.
Helped by decades-low interest rates and a tentative economic recovery, consumers spending is improving but analysts have warned that retailers may be priced for more than what they can deliver.
Retailers have also been boosted by expectations that low-end consumers will continue to benefit from government grants.
Truworths' shares have surged more than 33 percent so far this year, mirroring similar or more gains in the sector and far outpacing a 17 percent rise in the benchmark index. - Reuters