SA’s Tough Trading Conditions Set For Lengthier Spell

October 27, 2014 Mzwandile Jacks Business, Finance/Money, Retail & Manufacturing, Strategies & Solutions

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VENTURES AFRICA – The management of Famous Brands, the JSE-listed food retailer, on Monday said it expects that the current tough trading conditions of reduced consumer spending will persist for a lot longer than expected.
However, despite the constrained consumer discretionary income, management has high expectations for the forthcoming peak trading period.
“The foodservice sector will continue to grow, fuelled by the demand for convenience. Accordingly, aggressive promotional campaigns for the mainstream brands, supported by strong value and innovation propositions, will be implemented nationally and will peak over the November-December summer holidays,“ the management said on Monday.
It said all the group’s brands were presented at all major consumer hubs across South Africa and well-positioned to capture any available spend.
By December 2014 Famous Brands’ total network will have
exceeded 2,500 restaurants, further increasing the brands’ accessibility to customers.
In the six months to August this year, Famous Brands revenues surged 14 percent to R1.57 billion ($137 million) from R1.38 billion ($118.7 million).
Famous Brands said this was primarily on the back of enhanced contributions from the logistics and manufacturing operations during the period under review.
This performance could also be attributed to improved efficiencies and cost containment achieved across the entire business.
Basic earnings a share surged 18 percent during the period under review.