Foschini eyes high single digit profit growth
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Foschini eyes high single digit profit growth UPDATED 29 Jul 2009 | 02:37  
Foschini eyes high single digit profit growth

JOHANNESBURG (Reuters) - South African retailer Foschini Ltd expects to report "high single digit" growth in annual headline earnings, or possibly double-digit growth if it manages a bumper Christmas, its CEO said.

Chief Executive Doug Murray told Reuters in an interview on Wednesday sales in the first four months of the company's financial year were growing faster than in the second half of last year, as a revamp of its core Foschini stores pays off.

"So far this year, we've done better than the 8 percent sales growth in the second half, but the consumer is still heavily squeezed. It's frightening, you can have one great week and one terrible week. I have never seen it this unpredictable," he said in a telephone interview.

"But after four months I would say we've had growth at about the same levels or better than in the second half, maybe just flipping into double digit."

He said however that the broader consumer environment in Africa's biggest economy, which is mired in its first recession in 17 years, would "get tougher for a few months yet", and said bad debts would probably top out in September or October.

Shares in Foschini traded 1.14 percent lower at 56.60 rand by 1357 GMT.

Foschini, which competes with Truworths, Woolworths and unlisted Edcon, hopes to launch a short-term note programme to raise funds to expand its RCS financial unit.

Murray said the company expected to get an investment grade rating in August and to launch road shows in September, hoping to raise about 250-300 million rand per tranche.


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