Clothes don’t make the group

TFG’s trading update for the year shows the impact of different responses to Covid in the three territories where it operates: Africa, Australia and the UK. While a look at India’s plight shows the danger of indulging in any viral triumphalism, Africa’s hard early lockdowns and young populations seem to have been successful in allowing normal life to continue; Australia’s sealing of the borders has kept deaths down to 910 as against almost 128,000 in the UK, where a dither-then-overreact policy has been hugely disruptive, and only looks set to be saved by a highly successful vaccination programme.

Foschini’s stores in the UK were unable to trade in the fourth quarter, with nonessential retail only allowed to open up on April 12, and in the past year the UK has lost about half of its available store trading hours, and suffered severely depressed foot count and consumer confidence for the rest of the year. The group has impaired about 56% of the value of TFG London’s goodwill and intangibles to the tune of R2.7bn, and while trade has exceeded expectations since reopening, its brands catering for occasion wear and formal workwear are likely to continue to struggle.

In Africa things are looking up, with turnover growth of 37.3% aided by the acquisition of the parts of Jet that Foschini cherry-picked out of Edcon’s carcass.

TFG Australia saw turnover rise 30.4% in the fourth quarter despite occasional lockdowns and restrictions, and since then year-end trading has been encouraging, demonstrating the group’s resilience in unprecedentedly challenging times.