Bad news from the Men in Black over at Massmart, who have issued their mid-year trading update: in the 26 weeks through to 25 June, sales grew just 0.5% to R42.5bn, against internal inflation of 3.2%, with like-store sales declining -1.6%. Going through the divisions, like-store sales were down -3.5% at Massdiscounters, -0.2% at Massbuild and -3.3% at Masscash. The glimmer of light emanated from Makro, with Masswarehouse like-store sales up 1.5%, admittedly against inflation of 3.9%. Food sales outperformed clothing and GM, with the former increasing 3% and the latter declining -2.9%. Analysts were not what you’d call flabbergasted by the announcement, with most seeing prospects for improvement in the second half, particularly if a rate cut comes through, and chance of a modest turnaround in 2018.
Comment: Again, the performance of our retailers, in both food and GM, is directly proportional to the poor economic and shaky political circumstances of our current ambit. And in the case of Massmart, it is a time of back-end efficiency focus and driving relevant cross-divisional collaboration, which will no doubt start shifting performance over the next year.