& JACKSON'S PROFITS BOOMING
Brown & Jackson, which houses Pepkor's retail holdings in the UK,
produced excellent results for the six months to the end of December
1999. Operating profit before exceptional items showed a sharp increase
of 39% to £31,6m (R313m), while earnings per share were boosted 21%
Pepkor acquired the loss-making Brown & Jackson with its wholly-owned
subsidiary Poundstretcher in 1994 after gaining a foothold in British
retail through Your More Store, established in Scotland in 1991. In
the twelve months to June 1998, Brown & Jackson reported a profit
for the first time in seven years.
Brown & Jackson MD Johan Visser said the 39% rise in operating profit
on a 15% turnover increase to £225,4m (1998: £ 196,3m) highlighted
the further improvement in operating efficiency. All three operating
units - Poundstretcher, Your More Store (YMS) and What Everybody Wants
(WEW) - performed better compared to the previous period. Poundstretcher
grew operating profit by 45%, YMS by 15% and WEW by 51%.
The group's tax burden increased significantly from £1,9m to £6,8m
as the benefit of previous tax losses began to decrease. Despite the
heavier tax burden, profit after tax increased by 21% to £24,3m. It
is group policy to declare a dividend once a year.
Due to a rapid expansion programme Brown & Jackson opened 56 stores
and closed three during the period under review and the group now
trades from 574 stores.
Visser said the group would, in the light of the solid results, continue
its aggressive expansion programme. "Sales for the first seven weeks
of the new period grew according to budget and we are confident that
we will make further progress in the second half of the financial
year," he said.
Pepkor and Brown & Jackson chairman Dr Christo Wiese said the company
was well positioned to sustain a high growth rate and rapid expansion.
"The company's profits are still rising and the recent acquisition
of North Shoe is proof of the opportunities that exist for the group."
North Shoe, a fashion and footwear retail chain trading as "The Famous
Brunswick Warehouse" from 32 stores, was acquired by Brown & Jackson
for £22,9m earlier this year.
Since the beginning of the year Brown & Jackson has also opened four
pilot stores in Poland. The company indicated earlier that it was
investigating the possibility of expanding to Eastern Europe.
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