Industrial Reporter

BULK goods retailer Massmart did not expect to see a repeat of the rampant earnings growth that it showed in the past financial year, the group said in its annual report.

Lower grocery inflation, along with establishing a high earnings base, made it difficult for the group to repeat the 21,9% rise in sales to R20,4bn in its results for the year to June.

Even so, the market was still impressed with the 14,5% rise in sales for the first 15 weeks of its financial year.

Comparable store sales growth for the same period was 7,3%, the group said.

A retail analyst said the rise in sales was "pretty good", considering it was coming off a "considerable high base".

The company said steep price drops were evident in many product categories. These price drops were attributed to imports becoming cheaper because of the stronger rand.

Massmart said sales volume growth was 4,5%. Profit was in line with budget, and was ahead that of the comparable period in the previous year.

It planned to open at least eight new CBW outlets, two Builders Warehouse stores, two Tile Warehouse stores and one store each in the Jumbo and Game chains during the year.

Company CEO Mark Lamberti said the group's 2007 Vision for Growth project, for 14 stores to be added to the current 142 this year, was still on track.

Lamberti said all 14 new stores would make a significant contribution in the current year and produce sales approaching the group's average of R125m a store in the year to June 2005.

Oct 28 2003 07:19:42:000AM Larry Claasen Business Day 1st Edition