<\/p>\n
JSE-listed retail group Pepkor has forecast moderated earnings growth for the 2026 financial year, thanks to the subdued retail environment, a high comparative base, and strategic investments in the group\u2019s long-term growth platforms, including building the group\u2019s PlusB banking offering.<\/p>\n
This will likely put its headline earnings per share (Heps) for continuing operations in the range of 158.9 cents to 174.9 cents.<\/p>\n
For the 2027 financial year and beyond, the group has maintained its medium-term Heps guidance at a growth of 10-15%.<\/p>\n
In a trading update published on Tuesday for the 10 months ended 31 July 2026, it said this is based on the group\u2019s defensive market position, resilient performance and implementation of strategic projects.<\/p>\n
Its share price slumped by 12pm on the day, losing more than 2% in value. The drop was even steeper since a week ago, losing 7%.<\/p>\n
Trading performance<\/p>\n
Pepkor\u2019s group revenue from continuing operations for the period increased by 11.9% to R89.2 billion. Excluding acquisitions, group revenue increased by 7.3%.<\/p>\n
For the retail segments, group sales for the period grew by 5.2% when excluding acquisitions.<\/p>\n
It said the consumer environment in Southern Africa remained subdued, according to Retailers Liaison Committee (RLC) data, indicating sales moving outside the RLC network and lower customer share of wallet spend on clothing, footwear, home and beauty categories.<\/p>\n
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Promotional activity also remained elevated across the market.<\/p>\n
Read:
Two-pot pension withdrawals bolster Pepkor
Inside Pep\u2019s new R1bn bank, \u2018plusb\u2019, which launches in 2027<\/p>\n
\u201cAgainst this backdrop, the group outperformed the market and gained market share, based on July 2026 RLC data, adjusted for acquisitions and brand closures,\u201d the retailer said.<\/p>\n
Performance was led by Pep, the group\u2019s discount leader, while performance in Ackermans was, among others, impacted by negative growth in lay-bys.<\/p>\n
\u201cThe home furnishings and consumer electronics market remained challenging, however, the lifestyle business delivered a resilient performance, including the non-South African component of the newly acquired OK Furniture business.\u201d<\/p>\n
It added group online sales increased by 38.9%, including 81.9% growth in the clothing and general merchandise segment.<\/p>\n
The +more customer value platform reached more than 18 million members by the end of July 2026, further \u201cstrengthening the group\u2019s digital reach and customer engagement\u201d.<\/p>\n
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Pepkor has more stores \u2018than Ikea, Target and Primark combined\u2019<\/p>\n
Even with the consumer squeeze, the group further expanded its retail footprint to 6 677 stores, comprising 195 new stores opened and 541 stores added through acquisitions.<\/p>\n
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Financial services segment<\/p>\n
\u201cThe financial services segment continued its rapid expansion.\u201d<\/p>\n
FoneYam cellular device rental active customers reached 2.6 million, increasing by 14.7% for the period.<\/p>\n
It added the take-up rate of a second FoneYam rental by customers after completing their first, continues to exceed expectations \u2013 effectively extending the customer lifetime value of the FoneYam product by an additional 18 months.<\/p>\n
Read: Pepkor\u2019s fintech business flies<\/p>\n
In Capfin, credit extension has been curtailed with plans to reduce the Capfin book with future focus on growing credit through PlusB, the group\u2019s banking proposition.<\/p>\n
PlusB is expected to launch in the second half of FY27, subject to regulatory approvals. The total build cost remains on track to be below R1 billion and within target.<\/p>\n
Read: Pep\u2019s new bank \u2018plusb\u2019 will cost just R920m to build<\/p>\n
#Pepkor #shares #slide #subdued #earnings #outlook<\/p>\n","protected":false},"excerpt":{"rendered":"
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