South Africa’s largest fashion and lifestyle retailer, TFG (formerly known as The Foschini Group), wants to build up its newly launched technology hub to more than 100 new staff, its CEO said on Thursday, after the company swung to an annual operating loss.
Many firms have been expanding digital and e-commerce services as the coronavirus crisis drives more business online.
TFG’s tech hub, known as TFGLabs, is headed by the co-founders of South Africa’s leading online fashion retailer Superbalist.com, Claude Hanan and Luke Jedeikin, TFG CEO Anthony Thunström told investors. “To win in this area, you need to have the best pure-play talent available,” Thunström said.
Since launching TFGLabs about six weeks ago, the retailer has been hiring one to two people a week, and the pace of new hires will remain around that level for the rest of year, he added. “We need to build up that tech team to at least 100 plus people,” Thunström said.
TFG’s online turnover now contributes 12% to group retail turnover, up from 8.4% a year earlier, fuelled by a surge in online shopping and investments in technology and quick-response local manufacturing.
Loss
It said its medium-term target, usually a period of three to five years although it did not specify, was 20% to 30%. Overall, retail turnover fell 6.7% to R33-billion in the year ending 31 March, hurt by Covid-19 lockdowns and lack of demand for formal wear. As a result, TFG swung to an annual operating loss before finance costs of R719.2-million, after posting an operating profit of R4.7-billion a year earlier.
Its headline earnings per share, the main profit measure in South Africa, slumped by 80.8%. The clothes, homeware and jewellery retailer held on to the final dividend, saying it plans to resume dividends in the year ending March 2022.
Thunström said the company’s newly acquired budget clothing business, Jet, would launch standalone homeware stores and would offer homeware products in 345 existing Jet stores to benefit from the home improvement trend spurred on by the coronavirus. — Reported by Nqobile Dludla, (c) 2021 Reuters