Prominent South African retailer plunges amid earnings slump

The Foschini Group (TFG) has seen its share price drop by over 10% following the release of a lacklustre trading update for the first half of its 2026 financial year.

TFG is one of the country’s biggest clothing retailers, with well-known brands like @home, Jet, American Swiss, Sportscene, and Total Sports in its staple. It operates in Africa, the UK, and Australia.

On Tuesday, 21 October, the retailer released a trading update for the six months through September 2025.

These results were impacted by TFG’s acquisition of UK retailer White Stuff in 2024, which boosted the group’s sales figures compared to the prior year.

Including White Stuff, TFG’s sales grew by 12.7% to R29.9 billion. However, excluding the UK retailer, sales rose by a more subdued 3.5%.

Overall, the retailer expects its basic earnings per share to decrease by between 20% and 25%.

However, online sales performed well over the period, fueled by the strong growth in the retailer’s Bash platform. Group online sales grew by 55.3% in the six-month period, including White Stuff, and now contributes 14.7% to total retail sales.

In its TFG Africa segment, the retailer saw sales rise by 5.3%, which it attributed to the constrained consumer environment, with low sentiment and discretionary spend.

It explained that while it monitored operational costs closely over the six-month period, negative operating leverage from this subdued trading environment saw the Africa segment’s EBIT decline by 9.7%.

TFG London reported an even more subdued period, with total sales up 0.7% when excluding White Stuff.

The company said this lacklustre growth was due to a weak UK economy, although it noted that White Stuff is performing well, with 12.5% sales growth.

TFG further explained that its acquisition of the UK retailer resulted in finance costs doubling to £4 million (around R92.74 million).

TFG’s Australia segment also recorded a tough half-year, with sales down 0.5%. The company said this was due to subdued discretionary spend.

In addition, due to expenses growing ahead of sales, driven by costs from new stores and continued inflationary pressure, this segment’s EBIT declined by 18.4%.

TFG is expected to release its full interim results on or about 7 November 2025. The retailer’s share price is down over 10% on the day this trading update was released, seen in the graph below.