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Cape Town - Lewis Group continued its recent strong growth momentum and increased operating profit by 21.4% to R522 million for the six months to September 2025, driven by expanding margins and the good quality of the debtors’ portfolio. The operating margin expanded by 250 basis points to 20.7%.
The listed furniture retail group increased headline earnings by 16.0% to R335 million, with headline earnings per share up 16.8% to 648 cents. The interim dividend was increased by 12.3% to 337 cents per share.
CEO Johan Enslin said while trading conditions remained constrained over the past six months, the group continued to invest for longer-term growth by accelerating the expansion of its store footprint and growing the debtors’ book.
“We increased our store base to 958 with the opening of a net 40 new stores in the first half of the year, the highest number of stores opened by the group in any six-month period. This resulted in the group achieving its full-year store opening target within the first half,” he said.
The expansion included 28 new outlets for Real Beds, the bedding specialist acquired in 2024, which increased its footprint to 44 stores. The group plans to open a further 15 to 20 stores in the second half of the year, mainly in the specialist bedding brands.
Merchandise sales increased by 6.7% to R2.5 billion. Credit sales increased by 8.0% and accounted for 70.3% of total merchandise sales compared to 69.4% a year earlier. Sales in the stores outside South Africa, which represent 15.1% of the store base, increased by 7.7% and accounted for 18.0% of group merchandise sales.
The debtors’ book grew by 14.0% to R8.5 billion. The quality of the portfolio is reflected in satisfactory paying customers increasing to 82.7% of total debtors from 81.6% in the prior period. The collection rate at 78.3% was consistent with the rate reported for the second half of the 2025 financial year.
On the outlook for the second half of the financial year, Enslin said that against the backdrop of continued uncertainty in global markets and local political instability, discretionary spending is expected to remain constrained in the short to medium-term as consumers experience increasing financial pressure.
“While lower inflation and reduced borrowing costs are positive for consumers, persistently high unemployment and limited job creation in the country’s low growth environment continue to weigh on consumer confidence.”
Enslin said appealing marketing campaigns and promotions are planned across all the group’s brands to drive sales growth during the Black Friday and festive season trading period, supported by new merchandise ranges and good stock availability.
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