BENTONVILLE (TB&P) — Walmart’s 51% stake in South African retailer Massmart continues to disappoint as the retailer forecast more lower-than-expected earnings across all four of its divisions for the six months ended June 30.
Massmart will officially report six-month earnings on Aug. 29, but the retailer said losses are expected to widen despite comp sales growth of 3.6%, with inflation being 2.7% of that gain.
Massmart said sales rose 5.5% to $3.1 billion (U.S.) in the six months. The retailer’s local operations underperformed relative to those outside South Africa, with total sales rising by 4.9% and 11.8%, in Rand terms, respectively, noted IGD analyst Stewart Samuel.
“The slowdown was most marked at its Massdiscounters and Masswarehouse divisions, while the performance improved slightly at Massbuild and Masscash,” IGD noted.
Massdiscounters lackluster performance resulted in new leadership effective July 1 as CEO Albert Voogd was replaced by interim chief exec Andrew Stein.
Walmart ushered in new leadership this summer for Massmart appointing Mitch Slape as president and CEO for the African retailer. Slape is known for turning the Walmart business in Japan around and dubbed the “fixer” in retail circles.
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