South Africa's Massmart reports drop in earnings - CNBC Africa

South Africa's Massmart reports drop in earnings

Southern Africa

by Reuters 0

South Africa's Massmart reports drop in earnings. PHOTO: Massmart

South African retailer Massmart reported a 26.4 percent drop in half-year earnings on Thursday as foreign exchange losses and higher interest payments from property acquisitions hit profits.

Massmart, majority-owned by Wal-Mart Stores Inc, said diluted headline earnings per share fell to 122.4 cents in the six months ended June compared with 166.4 cents a year earlier.

The retailer has had to absorb part of the impact of a declining South African currency as it has limited scope to pass price increases on to debt-laden consumers in Africa's most advanced economy already grappling with rising energy and transport costs.

Headline EPS is the main profit measure in South Africa and strips out certain one-off items.

Sales rose 9.1 percent to 38.9 billion rand ($2.97 billion)for the 26 weeks ended June 28.