JOHANNESBURG – South Africa’s Woolworths Holdings Ltd is poised to beat estimates with its annual sales next month after the retailer said on Wednesday that revenue probably surged 55 percent in the year through June.
Woolworths said sales were boosted by the first time contribution from David Jones, the Australian department store chain it acquired in August last year.
The sales growth guidance is above a 51.5 percent forecast in a Reuters poll of 12 analysts.
Shares in Woolworths, which have surged about 24 percent this year, climbed 5.32 percent to R99.84.
Excluding the impact of David Jones, sales grew 12 percent, slightly slower than a year ago, reflecting slack consumer spending in its mainstay South African market.
Rival Shoprite Holdings said in a trading update that its sales rose 11.2 percent in the year through June, lagging a 13 percent forecast by Thomson Reuters StarMine Smart Estimates.
Shares in the company, Africa’s biggest grocer that focuses on staple products for low-income consumers, were down 0.3 percent at 171.66, paring gains so far this year to about 2 percent.
Retailers in Africa’s most advanced economy are struggling to boost sales growth as shoppers battle high personal debt levels and rising fuel prices.
Woolworths, however, has fared better than rivals such as Shoprite and Pick n Pay as its well-heeled consumers continue to splash out on its gourmet ostrich burgers and high-margin clothing label, Country Road, among other items.
The company is expected to release full results for the year to the end of June towards the end of August. Shoprite’s results are due on August 19. – Reuters
