Truworths profit up 16%

Johannesburg - Truworths International Ltd reported a 16% rise in interim headline earnings per share but forecast slower sales growth ahead given tough economic conditions.

The company said headline earnings per share up rose 16% to 184.7c in the 26 weeks to December 28, at the top end of its own forecast for a 12% to 17% rise. The increase is 23% if the extra week in the year-ago period is excluded, it said.

Truworths said sales of merchandise jumped to R3.306bn, up 10%, or 14% excluding the extra week in the prior period. Operating profit rose 11% and the company increased its interim dividend by 22%.

Sales in the first seven weeks of the second half of the financial year rose 20% versus the year-ago period, but Truworths said it did not expect sales to keep growing at this pace.

"While the decline in interest rates and lower fuel costs are positive for consumers, the retail trading environment remains difficult and management does not expect conditions to materially improve over the remainder of the 2009 period," the company said in a statement.

Truworths said it would increase trading space in the second half of the 2009 period by opening 20 new stores across all brands and was confident of achieving real full-year earnings growth.

Shares in the company fell 1.71% to R34, lagging a 0.88% weaker Johannesburg all-share index.

- Reuters