MR PRICE Group, in its 2025 financial year, will focus on growth from existing operations, a departure from the strategy in the past three years where growth was supported by acquisitions.
CEO Mark Behr said in the value clothing and homeware retail group’s annual report released on Friday they would also invest appropriately on existing operations, especially considering the threats of global commerce players.
“We’re in the pursuit of consistency – that our activities result in an ever-improving position, and that we are rated above our peer group,” he said.
Organic concepts Mr Price Cellular and Mr Price Kids were already showing great promise, he said.
“The year ahead will be tough – in the absence of growth in gross domestic product and employment, consumers will continue to be hard-pressed financially,” he said.
In the 2024 financial year, 79.7% of the group sales was from clothing, 17.1% from homeware and 3.2% from telecoms.
The group has continued to perform well and by the end of the 2024 financial year the annual compound growth rate of headline earnings per share, over 38 years, was 18.4%, while the same figure for dividend growth was 19%.
Behr said disruptions to supply chains were ongoing and the group’s management were hopeful that new leadership at Transnet would accelerate progress regarding port congestion. The group imports much of its clothing and homeware products.
Nevertheless, “we have the positioning, brands and people to perform well relative to our sector,” he said.
He said the new financial year would focus on profitable market share gains, while retaining strong operating and balance sheet metrics.
The contribution of acquisitions to operating profits was approaching the R1 billion mark, and integration activities would be stepped up to simplify doing business and identify efficiencies across the group.
Capital expenditure came to R1.1bn in the 2024 financial year, and R1bn more was planned for the 2025 year.
Some 103 million product units were locally procured in 2024. “We will continue to invest our time and service to initiatives and institutions that promote the rebuilding of South Africa,” he said.
In the year to March 30, revenue increased 15.5% to R37.9bn. This included the acquired Studio 88 Group (S88), effective October 4, 2022, excluding which revenue grew 5.8% to R30.3bn.
Diluted headline earnings a share grew 6.3% to 1 252.6 cents. Despite a challenging retail environment, the group delivered a stronger second half performance, as diluted headline earnings per share grew 17.4%, due to significantly improved sales momentum, GP margin expanding and market share gains.
The 526.8 cents a share final dividend was 17.8% higher than the previous year.
BUSINESS REPORT