By Alec Hogg
Steinhoff-stung Christo Wiese enjoyed some rare sunshine yesterday after shares in his JSE-listed investment company Brait picked up 3% on news from the UK. That makes a change after Brait was forced last year to write off the entire £780m invested in May 2015 to buy British fashion retailer New Look.
Promises of New Look’s imminent turnaround and huge profits from its hundreds of Chinese stores proved empty. Last September Wiese called enough, firing the Scandinavian CEO and instructing management to get back to basics. Two months later the company re-appointed New Look’s former CEO Alistair McGeorge (59) as executive chairman, giving him free rein to engineer the kind of turnaround he achieved from 2011 to 2013.
McGeorge has wasted little time in righting the New Look ship. In March he evoked protection from creditors via a Company Voluntary Arrangement, promising to close 60 of 593 stores and retrench 980 of 15,300 staff. In October he announced the exiting from China. And yesterday investors saw how McGeorge’s tough love is starting to deliver results.
New Look delivered an underlying profit of £22m for the half year to September compared with a £10m loss a year before. Also, EBITDA doubled and market share of its womenswear focus area rose 5%. After the kind of year he’s had, Wiese was due some good news. Long-suffering Brait shareholders will be hoping this is only the beginning,