Nov. 17 (Bloomberg) — Mr Price Group Ltd. said first-half profit increased 23 percent as the clothing and homeware retailer’s focus on cash sales helped offset weaker consumer spending in South Africa.
Net income was 921 million rand ($82.8 million) in the six months through Sept. 27, compared with 747 million rand a year earlier, the Durban-based company said in a statement today. Sales increased 15 percent to 8.3 billion rand. The company raised the half-year dividend 26 percent to 211.5 cents.
South African retailers have struggled this year as strikes and unemployment of more than 25 percent constrain consumer spending. Companies that make sales on credit have taken the bulk of the strain, as customers on lower-to-mid incomes fail to repay loans. Mr Price cash sales gained 18 percent in the period, and made up 81 percent of the total.
“Although consumer confidence increased slightly in the third quarter of 2014, retail trading conditions are expected to remain challenging in the medium-term,” Mr Price said.
The shares increased 0.6 percent to 245.88 rand as of 2.22 p.m. in Johannesburg. The stock has jumped 50 percent this year, the best performer on the FTSE/JSE Africa General Retailers Index.
