Bad news from major clothing retailer in South Africa
The Foschini Group (TFG) is expecting a large decline in earnings, with sales growth being weak in Australia and the United Kingdom.
In a trading statement for the year ending 31 March 2026, the group said that its earnings per share and headline earnings per share will decline by over 20% from the prior year’s results.
The group said it will publish a further trading statement once it has attained reasonable certainty about the expected earnings results.
The updated trading statement will be published prior to the release of TFG’s annual results, which will be released on 5 June 2026.
The group also released a trading update for the 11-week period from 28 December 2025 to 14 March 2026 (Q4 2026 so far), which looks at the group’s sales performance.
TFG Africa saw sales grow 7.6% to date in Q4, reflecting improved performance and partly due to the dissipation of the two-pot retirement funds released in the base.
Sales for the year to date increased 5.2%, with online sales and value-added revenues continuing to grow rapidly.
“Gross margin has also now normalised since January; however, this has been insufficient to recover the margin lost during the year up to and including peak season in Q3 FY2026,” it said.
TFG London has seen sales growth of 3.4% in GBP in Q4 to date, which includes the recently-acquired White Stuff in the base.
Sales have grown by 31.0% in GBP for the year to date. However, it only grew by 0.4% when excluding White Stuff.
Although the group said that White Stuff continues to perform well, it took on a large amount of debt to buy the UK-based retailer. There were pro‑forma sales growth of 5.2% for the year to date in the UK.
TFG Australia has recorded flat sales to date in Q4. Year-to-date sales have contracted by 1.4% in AUD.
Looking ahead, the group said that geopolitical uncertainty is expected to contribute to elevated input costs and cautious consumer behaviour.
“The group’s diversification and local manufacturing capability within its TFG Africa division provides some resilience,” it said.
“Management actions are focused on cost discipline and operational efficiencies to mitigate these headwinds where possible.”
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