News update: Massmart suffers huge losses

 News update: Massmart suffers huge losses

News update.

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Retail giant Massmart has reported a net loss of R1.753 billion ($114.18 million), citing lockdown restrictions and retrenchment costs. In 2019, the group reported a loss of R1.3bn for the same period. Today Massmart announced that its total sales of R86.5bn for the 52-weeks ending in December last year represented a decline of 7.7%, with a 7.5% decline in comparable-store sales.

The wholesaler, which is owned by the multinational grocer, Walmart, estimates that the coronavirus pandemic cost the company R6.1bn in lost sales last year. The company said it was battling to turn around some of its unprofitable businesses.According to the report, lockdown restrictions weighed heavily on the company’s ability to sell certain products such as alcohol and tobacco as the sale of the items was prohibited.

The headline loss for the period is R0.9bn compared to a headline loss of R1.2bn during the same period in 2019. The company said fluctuations in the rest of Africa currencies continued to negatively impact the group, especially concerning foreign-denominated leases and payables. “These contributed to the foreign exchange loss of R381.1 million.” Massmart opted to not pay dividends as its loss widened by about a third to R1.75bn. The company last paid dividends in 2018 when it offered shareholders the option of shares or cash.

Chris Louw

https://sashares.co.za/

Featured Financial Writer for SA Shares - Read more about Chris's Bio -

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