Wiese-backed Brait suffers R10,15 billion loss
Investment company Brait has reported a R10,15 billion loss for the year to end March.
Investment company Brait has reported a R10,15 billion loss for the year to end March, with the group’s UK expansion plans proving harder to implement than initially anticipated. This comes after the firm declared a R16,03 billion loss last year.
The owner of the UK-based New Look fashion chain, gym chain Virgin Active and British supermarkets Iceland Foods and Premier said net asset value fell to R57,32 a share from R78.15 last year, as New Look struggled.
The board did not declare a dividend as the board looks to reduce debt. Brait’s shares have declined 42 percent in the past 12 months.
Despite its travails and while acknowledging that New Look’s performance was disappointing in challenging market conditions, however, Brait was confident that its fortunes in the UK could be turned around.
Brait said in a statement:
“New Look’s turnaround plan is now well under way and has already made substantial operational improvements to help stabilise the business, reduce its fixed cost base and attain a better position to drive full price sale.”
New Look's revenue decreased by 7,3 percent in the comparative period. The group’s other divisions were competitive. They included Virgin Active, which strengthened its balance sheet and opened 10 new clubs, six in South Africa, two in Asia Pacific and one in both the UK and Italy.
Brait’s issues will come as a further blow to South African billionaire businessman Christo Wiese (pictured), has a 35 percent stake in Brait and backed its purchase of New Look in 2015 in a $1,2 billion deal. The under-fire Wiese suffered extensive losses in the Steinhoff International accounting irregularities scandal and is also suffering the consequences of listed investment and management company Invicta’s earnings took a hit of some 81 percent due to a specific tax provision of R400 million.