Mr Price versus TFG

Retailers Mr Price and TFG recently released their annual results, which were viewed as positive and showed a solid foundation for growth.

Mr Price is one of South Africa’s biggest retailers. Its brands include Mr Price, Mr Price Home, Mr Price Sport, Miladys, Yuppiechef, and Studio 88.

Its results for the 52 weeks ended 29 March 2025, showed that revenue increased by 7.9% to R40.9 billion, while its gross margin expanded by 80 basis points to 40.5%.

The group achieved a record operating profit level of R5.8 billion, with its operating margin increasing 20 basis points to 14.2%.

Basic and headline earnings per share of 1,416.3 cents and 1,424.0 cents were up 11.0% and 10.7%, respectively.

Group retail sales of R39.4 billion increased 7.8%, and comparable store sales increased 3.4%. Group store sales increased 7.8% and online sales 7.9%.

The retailer surpassed 3,000 stores during the period. It opened 184 new stores across its 15 trading chains, expanding its total store footprint to 3,030 stores.

The Foschini Group (TFG) also recorded a solid performance for its 2025 financial year, as its store expansions and a UK acquisition boosted sales.

TFG is one of South Africa’s biggest clothing retailers and owns beloved brands like @home, Jet, American Swiss, Sportscene, and Total Sports. It operates in Africa, the UK, and Australia.

TFG’s results for the year ended 31 March 2025 showed that revenue increased 4.1% to R62.6 billion, while operating profit grew by 4.4% to a record R6.2 billion.

TFG’s basic earnings per share (EPS) grew by 4.9% to 980.6 cents per share, while profit for the year was R3.19 billion.

Improved gross margins and a continued focus on cost management across all business segments resulted in a 4.4% increase in operating profit.

TFG Africa grew sales by 7.0%, or 5.6% on a like-for-like basis, in the second half of the year as the base normalised from the prior year’s first half’s clearance activity.

Its more recently acquired businesses, Jet and Tapestry, also further accelerated sales and profit growth.

A standout performer in these results was the success of TFG’s online eCommerce platform, Bash, which saw online sales grow by 43.5% and now contributes 5.8% to total TFG Africa sales.

Analyst opinions about Mr Price and TFG

Analysts expressed mixed views on which of the two retailers offers a better investment opportunity, although they generally liked the results from both.

Grant Nader from Benguela Global Fund Managers said Mr Price is a better-quality business which does what they do well.

“Their free cash flow conversion is excellent, and it is a well-run business,” Nader said in a Business Day TV interview.

He said TFG has a more innovative management team that is creative in its acquisitions, with ambitious plans for the business.

However, TFG has not always delivered well on its capital allocation, as seen in its United Kingdom and Australian operations.

“They are both good. However, I would pick Mr Price as an investment, but you will not go far wrong with TFG,” Nader said.

Shane Watkins from All Weather Capital said TFG has maintained good margins in its businesses, which bodes well for the company.

He said TFG’s latest results showed excellent execution by the TFG management team, which resulted in record numbers.

He added that TFG’s online growth was impressive. “The online strategy is clearly bearing fruit,” he told Business Day TV.

“They are monetising the online business well, and it will be a growth vector for the clothing retailer,” he said.

Mr Price versus TFG

TFG generated R62.6 billion in revenue, which is 53% greater than that of Mr Price, which generated R40.9 billion.

Although TFG generates more revenue, Mr Price has seen higher growth over the financial period. TFG increased its revenue by 4.05% while Mr Price grew its revenue by 7.88%.

TFG’s gross profit margin of 46% is higher than the gross profit margin of Mr Price, which came in at 42.4%.

However, after operating expenditure, Mr Price had an operating profit of 14.12%, while TFG achieved an operating profit margin of 10.13%.

The same trend can be seen in comparing the two competitors’ profit before tax and net profit margins.