‘Back-to-the-office’ bumper results for Truworths

Truworths International – the upper-market fashion retailer with operations in SA, several other African countries and through its UK business Office – posted a bumper set of annual results on Thursday as demand for fancier clothing and formalwear bounced back strongly post the Covid-19 lockdown lows.

People heading back to the office and going out more, following the local and international economy ‘opening up’, clearly gave the Cape Town-headquartered group a boost. But cost containment measures by management and a share buyback also contributed to its record performance.

Truworths reported an almost 50% surge in its headline earnings per share (Heps), to 779.8 cents, for the 53 weeks ended 3 July 2022.

This turned out to be even higher than the group’s forecast surge in Heps, highlighted in a Sens trading statement in mid-August.

At the time Truworths said that it expects to see full-year Heps surging by up to 43%, to 745 cents.

Read: Truworths expects record full year earnings

Heps is the key profit measure for most JSE-listed groups. However, Truworths also delivered on most other financial and operating metrics for FY 2022.

The group’s overall retail sales shot up 9%, to R18.5 billion, while its gross margin increased to 53.5% (FY2021: 51%).

Profit before finance costs and tax surged 45.4% to R4.4 billion, boosting its operating margin to 24.7%, compared to 18.5% for the prior year.

Dividends

The strong post-Covid-19 performance saw Truworths declaring a final cash dividend of 205 cents per share for FY 2022, compared to a final dividend of 118 cents last year.

This was declared “from retained earnings”.

The final dividend took the group’s total dividend per share for the year to 505 cents – representing a surge of 44%.

Truworths’s share price traded over 3% up in morning trade on Friday.

Listen to The Property Pod interview with Broll on workers going back to the office (or read the transcript):