Truworths CEO dumped R84 million in shares in two months

Truworths CEO Michael Mark has sold over 1 million of the company’s shares worth R84.09 million over the past two months.

Truworths informed shareholders that Mark had sold 375,534 of the company’s shares on 12 October for an average price of R74.88 per share. The total selling price for these shares was R28.12 million.

The company said Mark sold the shares to settle the loan repayable and tax to enable him to retain the balance of the shares vested.

This marks the fourth sale that Mark has undertaken in the past two months.

Since 6 September, Mark has sold 1.13 million Truworths shares for a total selling price of R84.09 million.

Mark has been the CEO of Truworths – which owns brands such as Uzzi, Identity, Daniel Hechter, and Naartjie – for 32 years.

He is not the only Truworths director who sold the company’s shares over the past few months.

Between 29 September and 3 October, 11 of the company’s directors had sold 906,610 shares worth R68.65 million.

Truworths’ deputy CEO Sarah Proudfoot sold around R6.8 million worth of shares in this time.

It is generally considered a bad sign when a company’s directors sell such large amounts of shares.

Counterpoint Asset Management executive director and portfolio manager Piet Viljoen said, “The Truworths directors are not telling you what to do. They are shouting at you.”

This is not the only company’s directors Viljoen has been critical of for selling shares.

Earlier this year, Naspers announced that CEO Bob van Dijk and CFO Basil Sgourdos had sold R1.8 billion of their Naspers and Prosus shares after the companies announced their buyback scheme in June 2022.

“Directors of Naspers are selling large chunks of shares while the company is in a buyback program. Have they no shame?” Viljoen said.

He highlighted that it is never a good sign when executives sell shares when a repurchase programme is ongoing.

He said if Naspers’ management was truly concerned about creating shareholder value, they would unbundle their Tencent stake and give investors the full value of their holding.

This would be the easiest and cheapest way to narrow the discount at which Naspers was trading.

Michael Mark’s sales since 6 September 2023

DateSharesTotal selling price
6 September269,881R19,438,780
29 September107,308R8,234,333
3 October380,000R28,298,068
12 October375,534R28,118,934