Staff Reporter
The Foschini Group Limited has reported modest sales growth for the third quarter of its 2026 financial year, as tough consumer conditions in South Africa continued to limit discretionary spending.
In a trading update covering the nine months from 1 April 2025 to 27 December 2025, including the 13 weeks to 27 December 2025, the Group said trading conditions remained difficult despite easing inflation and recent interest rate cuts.
The company noted that the third quarter of the prior year benefited from the introduction of South Africa’s two-pot retirement system, which supported consumer spending at the time.
Sales during the third quarter tracked in line with the wider retail market. Data from the retail liaison committee showed a subdued festive season across the sector.
TFG gained 60 basis points of market share in homeware and furniture, while it maintained its share in apparel.
Like-for-like sales in TFG Africa rose by 1.2% in the third quarter and by 2.9% over the nine-month period.
Online sales remained a key growth area. Sales through digital channels increased by 54.9% in the third quarter and by 46.7% for the year to date, supported by strong performance from the Group’s Bash platform.
Online sales now make up 7.9% of total revenue, with scale contributing to better profitability.
Gross margin for the nine-month period declined by 90 basis points, mainly due to inventory clearance activity.
Credit sales increased by 1.6% in the third quarter and by 5.3% for the year to date, accounting for 26.1% of total sales. The Group said it continued to apply a cautious approach to credit granting.
The debtors’ book rose by 6.8% to R10.1 billion in December 2025, from R9.4 billion a year earlier.
TFG said the quality of the book remained broadly in line with the prior period, reflecting a stable risk environment and disciplined collections.
The group said trading conditions in South Africa are likely to remain challenging in the near term. Management will focus on clearing in-season inventory, maintaining cost discipline and managing capital carefully.
While near-term guidance remains cautious due to low wage growth and weak discretionary spending, TFG said it is more positive about the medium term, supported by lower inflation, reduced interest rates, a firmer rand and lower fuel costs.
Caption
The Foschini Group Limited says trading conditions remained difficult despite moderating inflation and recent interest rate cuts.
