South African retailer Pepkor's sales rise 13.8 percent

Retailer Pepkor Holdings Ltd, previously known as Steinhoff Africa Retail (STAR), on Tuesday reported a 13.8 percent rise in group revenue for the nine months to the end of June, as its low prices attracted shoppers.

The clothing and furniture retailer said group revenue rose to 48.9 billion rand ($3 billion) on a statutory basis, while on a comparable basis, group revenue increased 9.2 percent.

Comparable basis results include pre-acquisition contribution from Tekkie Town and Building Supply Group.

“The overall retail environment remains very competitive with financially constrained consumers,” the company said in a statement.

Last month, shareholders approved changing the company’s name to Pepkor Holdings in a move to distance the company from its crisis-hit parent, Steinhoff International.

Pepkor primarily targets lower to middle-income consumers who are facing a squeeze on their incomes from high unemployment, rising fuel costs.

“The group’s focus on providing value to customers at affordable prices is expected to continue supporting group performance during the remainder of the financial year,” it said.

The company said that merchandise sales were up 7.7 percent, while retail space increased by 5.4 percent with the opening of 148 new stores during the period.

Pepkor’s shares were up almost one percent at 1346 GMT.