Giant retailer Massmart took an 11% knock on the JSE on Friday amid concerns about the slow progress in returning the group to profitability during the 26 weeks ended June 2021 despite an increase in sales during the period under review.
The shared closed the day 9.14% lower at R54.95.
The retailer told investors that total sales amounted to R41.3 billion, representing an increase of 4.4% on the same period last year.
It expected headline losses to reduce to R700 million from a R1billion headline loss a year earlier. It also said total sales from Game had fallen to R7.6 billion, down 7.6% in the half year compared to a year earlier with comparable store sales being 6.9% lower given the prevalence of Game stores in malls.
“Foot traffic in most super and regional malls and retail centres remained constrained, as consumers prefer to avoid crowded indoor spaces in light of Covid-19 infection concerns,” Massmart said.
Game has struggled to return to profitability despite several steps to resuscitate the brand including discontinuing frozen and fresh produce.
The company said it expected its earnings to be adversely affected by the impairment of the carrying value assets in Game of R570million and retrenchment costs relating to the reorganisation of certain home office support functions.
It recorded a 9.4/5 declines in sales at Cambridge to R3.4billion lower than the same time last year and 9.6% lower on a comparable stores basis.
