Massmart takes hit from all sides in ‘perfect storm’
CEO says slow growth, VAT and fuel price hikes in first quarter almost halved company's profits
The persistent pressure on consumer spending has claimed another victim, with retail group Massmart reporting on Thursday that its first-half profit has almost halved. Multiple economic factors and restructuring costs hit Massmart from different directions in what CEO Guy Hayward said was a "perfect storm". The fall in profit and pressure on sales in the six months ended July 1 have prompted the owner of household brands such as Game, Makro and Builders’ Warehouse to pursue new revenue streams in the value added services (VAS) business whose offerings include money transfers, lotto sales, credit product sales and extended warranties. Speaking at the release of the company’s results Hayward singled out the decline in GDP, fuel price increases, a rise in VAT, currency volatility and the slowing retail sales growth. "The last six months were indeed the perfect storm. I have never felt volatility and uncertainty like this. I do not think this time six months ago any of us expected the G...
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