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Aug 29, 2013
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South Africa's Woolworths reports profit up 27.3 percent

Aug 29, 2013

JOHANNESBURG, South Africa - South African retailer Woolworths reported a 27.3 percent rise in full-year profit on Thursday, reflecting the resilience of its upscale customer base as the rest of the consumer market struggles with high personal debt.

Woolworths, which sells luxury food products and clothing, said headline earnings per share (EPS) totaled 340.4 cents in the year to end-June compared with 267.3 a year earlier.

That was broadly in line with a 339 cents estimate by Thomson Reuters StarMine, which puts more weight on more recent forecasts and those from top-rated analysts.

Headline EPS, South Africa's primary profit gauge, strips out certain one-off items.

Retailers in Africa's biggest economy are struggling to grow sales at a faster pace as consumers rein in spending due to high personal debt, unemployment and rising fuel and transport prices.

But Woolworths, similar in style and products to Britain's Marks & Spencer, is faring better as high income consumers continue to splash out on its upscale groceries and apparel.

Sales rose 23.2 percent to 35.2 billion rand ($3.40 billion), with food sales recording 15.4 percent growth. Sales were also boosted by Woolworths' purchase last year of Australian fashion retailer Witchery Group.

Shares in the Cape Town-based company are down about 15 percent so far this year, underperforming a 10 percent gain in the JSE Top-40 index .

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