Full Year 2026 Truworths International Ltd Earnings Call

August 28, 2026

Sarah Proudfoot: weeks to 28 June 2026. I would like to introduce myself. For those who do not know me, I am Sarah Proudfoot. I am the Co-Deputy CEO. Online today we have our CEO, Michael Mark, who is currently in New York. Because his Wi-Fi connection is a little bit unstable, he will be listening and joining when possible. Other than that, we have Emanuel Cristaudo, who is the other Joint Deputy CEO and our CFO, and also Reon Smit, who is our Financial Director. We have quite a lot to share with you today. This is our agenda, and we are going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results statement.

Sarah Proudfoot: Weeks to 28 June 2026. I would like to introduce myself. For those who do not know me, I am Sarah Proudfoot. I am the Co-Deputy CEO. Online today we have our CEO, Michael Mark, who is currently in New York. Because his Wi-Fi connection is a little bit unstable, he will be listening and joining when possible. Other than that, we have Mannie Cristaudo, who is the other Joint Deputy CEO and our CFO, and also Reon Smit, who is our Financial Director. We have quite a lot to share with you today. This is our agenda, and we are going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results statement.

Speaker #1: Weeks to the 28th of June 2026. So I'd like to introduce myself for those who don't know me: I'm Sarah Proudfoot, I am the co-deputy CEO, and online today we have our CEO, Michael Mark.

Speaker #1: Who is currently in New York, and because his Wi-Fi connection is a little bit unstable, he will be listening and joining when possible. And other than that, we have Manny Custardo, who's the other joint deputy CEO, and the our CFO, and also Rheon Smit, who is our financial director.

Speaker #1: Good afternoon, everybody, and welcome to this Truworths Group Results presentation for the 52 weeks to the 28th of June 2026. I'd like to introduce myself for those who don't know me.

Speaker #1: So we have quite a lot to share with you today. This is our agenda, and we're going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results presentation, from our results statement.

Speaker #1: I'm Sarah Proudfoot. I am the co-deputy CEO, and online today we have our CEO, Michael Mark. He is currently in New York, and because his Wi-Fi connection is a little bit unstable, he will be listening and joining when possible.

Speaker #1: So you all know it's been a challenging year for us, and we are a little bit disappointed in the results. I understandably. But it's been a challenging year for consumers generally, in both the markets in which we operate, both South Africa and the United Kingdom.

Sarah Proudfoot: You all know it has been a challenging year for us, and we are a little bit disappointed in the results, understandably. It has been a challenging year for consumers generally, in both the markets in which we operate, both South Africa and the United Kingdom. We feel happy that there are some very nice positives that have come out of these results. The first being, we have protected our margin. We have continued to be highly cash generative. We, in fact, have a cash conversion rate that improved to 97% from 90% in the previous year. We grew Office in the UK by 4.9% in a difficult economy in the UK. Truworths, although we had a very difficult H1, had a much improved H2 of the year.

Sarah Proudfoot: You all know it has been a challenging year for us, and we are a little bit disappointed in the results, understandably. It has been a challenging year for consumers generally, in both the markets in which we operate, both South Africa and the United Kingdom. We feel happy that there are some very nice positives that have come out of these results. The first being, we have protected our margin. We have continued to be highly cash generative. We, in fact, have a cash conversion rate that improved to 97% from 90% in the previous year. We grew office in the UK by 4.9% in a difficult economy in the UK. Truworths, although we had a very difficult H1, had a much improved H2 of the year.

Speaker #1: And other than that, we have Mandy Custard, who is the other joint deputy CEO, and then our CFO, and also Rheon Smith, who is our financial director.

Speaker #1: But we feel happy that there are some very nice positives that have come out of these results. For the first thing, we've protected our margin, we've been continued to be highly cash generative, we in fact have a cash conversion rate that improved to 97% from 90 in the previous year, we grew office in the UK by 4.9% in a difficult economy in the UK, and truest, although we had a very difficult first half, had a much improved second half of the year.

Speaker #1: So, we have quite a lot to share with you today. This is our agenda, and we're going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results presentation and our results statement.

Speaker #1: So, as you all know, it's been a challenging year for us, and we are a little bit disappointed in the results, understandably. But it's been a challenging year for consumers generally, in both the markets in which we operate—both South Africa and the United Kingdom.

Speaker #1: We continued to invest in growth, particularly in store expansion in the UK, and our online contribution grew to 21%, and we had more than 20% growth in online in truest South Africa.

Sarah Proudfoot: We continued to invest in growth, particularly in store expansion in the UK, and our online contribution grew to 21%. We had more than 20% growth in online in Truworths South Africa. As always, we build on the long term. Truworths is always guided by its business philosophy, and many of you will be familiar with it. It essentially is our beacon and our guide, and it ensures that we always focus on the long term as opposed to reacting unduly to any short-term things happening in the economy or in the business itself. Because of that, we invest in organic growth, and we really try and return and are successful at returning our surplus funds to our shareholders.

Speaker #1: But we feel happy that there are some very nice positives that have come out of these results. The first being, we've protected our margin.

Speaker #1: As always, we build on the long term, truest is always guided by its business philosophy, and many of you will be familiar with it, but it's essentially is our beacon and our guide, and it's ensures that we always focus on the long term, as opposed to reacting unduly to any short-term things happening in the economy or in the business itself.

Speaker #1: We have continued to be highly cash generative. In fact, our cash conversion rate improved to 97%, up from 90% in the previous year.

Speaker #1: We grew Office in the UK by 4.9% in a difficult economy in the UK, and Truworths, although we had a very difficult first half, had a much improved second half of the year.

Speaker #1: So because of that, we invest in organic growth, and we really try and return and are successful at returning our surplus funds to our shareholders.

Speaker #1: We continued to invest in growth, particularly in store expansion in the UK, and our online contribution grew to 21%. We also had more than 20% growth in online in Truworths South Africa.

Speaker #1: We always open to making acquisitions, but we only like to pursue those if they are a complete fit with our business philosophy and with our longer-term strategy.

Sarah Proudfoot: We are always open to making acquisitions, but we only like to pursue those if they are a complete fit with our business philosophy and with our longer term strategy. We try and make considered decisions made from conviction, with a clear sense of how they are going to enable us to accelerate our business in the long term. Our growth is our challenge in Truworths Africa in particular, and we are very aware of that. Our growth is going to be deliberately driven by a combination of our brand and our product, which is what we call our hero, and we are going to talk to you a little bit more about that. Obviously by customer and customer engagement through our very large account base and our very large number of loyalty customers. We believe that we are well positioned to move forward for the next century.

Speaker #1: As always, we build for the long term. Truworths is always guided by its business philosophy, and many of you will be familiar with it.

Speaker #1: And we try and make considered decisions, made from conviction, with a clear sense of how they are going to enable us to accelerate our business in the long term.

Speaker #1: But it essentially is our beacon and our guide, and it ensures that we always focus on the long term, as opposed to reacting unduly to any short-term things happening in the economy or in the business itself.

Speaker #1: Our growth is our challenge in truest Africa in particular, and we are very, very aware of that. And our growth is going to be deliberately driven by a combination of our brand and our product, which is what we call our hero, and we're going to talk to you a little bit more about that, and obviously by customer better and customer engagement through our very large account base and our very large number of loyalty customers.

Speaker #1: So, because of that, we invest in organic growth, and we really try—and are successful at—returning our surplus funds to our shareholders.

Speaker #1: And we believe that we are well positioned to move forward for the next century. We currently are 109 years old, within itself is something we're very proud of, but we also feel the responsibility of making sure that truest will be not only around, but thriving and growing for the 100 years into the future.

Speaker #1: Action with a clear sense of how they are going to enable us to accelerate our business in the long term. Our growth is our challenge in Truworths Africa in particular, and we are very, very aware of that.

Sarah Proudfoot: We are currently 109 years old, which in itself is something we are very proud of. We also feel the responsibility of making sure that Truworths will be not only around, but thriving and growing for that 100 years into the future. This is a visual which many of you will be familiar with. It is an infographic that illustrates our business philosophy. I am not going to go through it in any detail because many of you are familiar with it, and I think it speaks for itself. Today we are going to be focusing on telling you quite a lot about the strategy that we have for growth and a fundamental illustration of the essence of our business philosophy, and we refer to this as the hero and the pedestal, and it is the relationship that determines everything that we do.

Speaker #1: And our growth is going to be deliberately driven by a combination of our brand and our product hero, and we're going to talk to you a little bit more about that.

Speaker #1: So this is a visual which many of you will be familiar with, but it's the infographic that illustrates our business philosophy. I'm not going to go through it in any detail because many of you are familiar with it, and I think it speaks for itself.

Speaker #1: And obviously, by custom, better and customer engagement through our very large account base and our very large number of loyalty customers. We believe that we are well positioned to move forward for the next century.

Speaker #1: So today we're going to be focusing on telling you quite a lot about the strategy that we have for growth, and a fundamental illustration of the essence of our business philosophy.

Speaker #1: We currently are. We will be familiar with it. It's an infographic that illustrates our business philosophy. I'm not going to go through it in any detail because many of you are familiar with it, and I think it speaks for itself.

Speaker #1: And we refer to this as the hero and the pedestal. And it is the relationship that determines everything that we do. So to explain it a little bit further, the hero, the hero is what creates the desire from our customers, in terms of why they should choose to shop at truest, because of course it is their choice.

Sarah Proudfoot: To explain it a little bit further, the hero. The hero is what creates the desire from our customers in terms of why they should choose to shop at Truworths, because of course it is their choice. The hero for us is the critical combination of the product itself, but also very importantly, the brands that we have. We have a large portfolio of brands in Truworths, unusually all of which are wholly owned and exclusively available in Truworths stores only. It is that that creates the unique model of our Truworths Emporium, which we believe we have not seen anywhere else in the world. That is the hero.

Speaker #1: And the hero for us is the critical combination of the product itself, but also very importantly the brands that we have. You know, we have a large portfolio of brands, in truest, and usually all of which are wholly owned and exclusively available in truest stores only.

Speaker #1: So today, we're going to be focusing on telling you quite a lot about the strategy that we have for growth, and a fundamental illustration of the essence of our business philosophy.

Speaker #1: And we refer to this as the hero and the pedestal, and it is the relationship that determines everything that we do. To explain it a little bit further, all of which are wholly owned and exclusively available in Truworths stores.

Speaker #1: And it is that that creates the unique model of our truest emporium, which we believe is we haven't seen anywhere else in the world.

Speaker #1: So that's the hero. Very importantly, the hero is supported by what we calling the pedestal. And we are seeing this as a, if you were to visualize it, a fantastic golden pedestal that really elevates and shows off the hero being the product and the brands and the pedestal is made up of a combination of beautiful stores we have an incredible store portfolio in both South Africa and in the UK, the credit offering in South Africa, and obviously our e-commerce and digital channels.

Sarah Proudfoot: Very importantly, the hero is supported by what we are calling the pedestal, and we are seeing this as a, if you were to visualize it, a fantastic golden pedestal that really elevates and shows off the hero being the product and the brands. The pedestal is made up of a combination of beautiful stores. We have an incredible store portfolio in both South Africa and in the UK. The credit offering in South Africa, and obviously our e-commerce and digital channels, and many more. But those are the three fundamentals of the pedestal.

Speaker #1: Only. And it is that which creates the unique model of our Truworths Emporium, which we believe we haven't seen anywhere else in the world.

Speaker #1: And many more. But those are the three fundamentals of the pedestal. And the new concept that we're also going to unpack a little bit further is the concept of tiered value architecture.

Sarah Proudfoot: The new concept that we are also going to unpack a little bit further is the concept of tiered value architecture, which is about improving accessibility to the customer at the entry point, but then also how we tier the product up using not only tiers within the product range itself, but also within the brand architecture within Truworths. This is a really, I think, a slide that makes it very easy to understand. The product value staircase, we are calling it, and the opening layer, which is, I think, obvious. Number 1, that critical point of entry into the brand. We understand that we are positioned in the upper mid-market tier of the South African market. Sorry, just to clarify, this concept and the next few slides speak specifically to the top-line growth challenge that we have in Truworths South Africa.

Speaker #1: Which is about improving accessibility to the customer, the entry point, but then also how we tier the product up using not only tiers within the product range itself, but also within the brand architecture within truest.

Speaker #1: So this is a really, I think, a slide that makes it very easy to understand. So the product value staircase, we're calling it, and the opening layer, which is, I think, obvious, number one, that critical point of entry into the brand.

Speaker #1: We understand that we are positioned in the upper mid-market tier of the South African market, and sorry, just to clarify, this concept and the next few slides speak specifically to the top line growth challenge that we have in truest.

Speaker #1: South Africa. We've spoken to you about the work we've been doing in the last few years about trying to address the tier of core product in our ranges, where we felt we were underrepresented.

Sarah Proudfoot: We've spoken to you about the work we've been doing in the last few years about trying to address the tier of core product in our ranges where we felt we were underrepresented. We've done a lot of work in this area, and we are very pleased with the results that we are seeing. We feel that we have a much better offering of very well-priced but elevated basic product in our ranges that enables the customers to come in and shop at a very affordable entry price point for a product that over-delivers on the value expectation if we're doing our job correctly.

Speaker #1: And we've done a lot of work in this area, and we are very pleased with the results that we are seeing, and we feel that we have a much better offering of very well-priced but elevated basic product in our ranges, that enables the customers to come in and shop at a very affordable entry price point for a product that over-delivers on the value expectation, if we're doing our job correctly.

Speaker #1: Then because of that positioning that we spoke about, and because of the expectation from our customers of excellent quality, we tier up from the core product into the better range, where we aim to provide better tiers of fabric, better quality, than many players in the South African market, where many people have pursued price and the value market.

Sarah Proudfoot: Because of that positioning that we spoke about and because of the expectation from our customers of excellent quality, we tier up from the core product into the better range where we aim to provide better tiers of fabric, better quality than many players in the South African market, where many people have pursued price and the value market. We don't believe that that is a space for us. Very importantly, this is where the brand component kicks in because the branding of that product also creates a level of aspiration that the customers see value in. It becomes clear from there to the commonly known strategy that we add the best tier, obviously more elevated fabric, improved styling. We do a lot of in-house styling for all of our brands. Branding becomes more important, elevated trims.

Speaker #1: We don't believe that that is a space for us. And very importantly, this is where the brand component kicks in, because the branding of that product also creates a level of aspiration that the customers see value in.

Speaker #1: It becomes clear from there, it's a very commonly known strategy, that the best we add the best here, obviously more elevated fabric, improved styling, we do a lot of in-house styling for all of our brands, branding becomes more important, elevated trims, and critical here is the fact that the customer must elect to buy up through this product staircase, because the product itself has to show the perceived value, and create that level of desirability.

Sarah Proudfoot: Critical here is the fact that the customer must elect to buy up through this product staircase because the product itself has to show the perceived value and create that level of desirability. At the top end, we have what we're calling the irresistible higher price product, which despite the high price point on the garment, has the requisite level of desirability to make the customer make that purchase decision. You will also see we have introduced some elevated brands into our portfolio over the last period. The one is called Ovilo, and the second is called Hester, both of which are elevated above our current top tier, which is Daniel Hechter. One, Ovilo, has a sort of Mediterranean slant and has superior fabrics, beautiful prints, and very sophisticated shoes, bags, and accessories. So it's a full lifestyle offering.

Speaker #1: And then at the top end, we can have what we're calling the irresistible higher price product, which despite the high price point on the garment, has the requisite level of desirability to make the customer make that purchase decision.

Speaker #1: You will also see we have introduced some elevated brands into our portfolio, over the last period, and the one is called Ovillo. And the second is called Hester, both of which are elevated above our current top tier, which is Daniel Hester.

Speaker #1: One Ovillo has a sort of Mediterranean slant, and has superior fabrics, beautiful prints, and very sophisticated shoes, bags, and accessories, so it's a full lifestyle offering.

Speaker #1: Hester is more elevated, and more formal, and is the top tier of the Daniel Hester range. Those in themselves bring in the product tiering that we're talking about.

Sarah Proudfoot: Hester is more elevated and more formal and is the top tier of the Daniel Hechter range. Those in themselves bring in the product tiering that we're talking about. If you look at it, our reality as we see it is that we are operating in a constrained economic environment in South Africa. We have a very large existing store base, so there isn't easy upside in South Africa for store expansion, and there isn't easy ability to significantly grow meaningful new accounts in a constrained environment without opening the taps, as you would say, to a level where we are not comfortable.

Speaker #1: So if you look at it, our reality as we see it, is that we are operating in a constrained economic environment in South Africa, we have a very large existing store base, so there isn't easy upside in South Africa for store expansion, and there isn't easy ability to significantly grow meaningful new accounts in a constrained environment without opening the taps, as you would say, to a level where we are not comfortable.

Speaker #1: So the big unlock for us in terms of growth is making sure that our products are much more desirable, and the customer elects to trade up through an improved sales and better mix, which should drive a small inflation into our product offering, and we believe that this is critical in terms of driving sales growth.

Sarah Proudfoot: So the big unlock for us in terms of growth is making sure that our products are much more desirable and the customer elects to trade up through an improved sales and better mix, which should drive a small amount of healthy inflation into our product offering, and we believe that this is critical in terms of driving sales growth. That is what we are calling the architecture of aspiration, and it is really, we believe, our key strategy for growth in Truworths. The merchandise has to be desirable, and then importantly, our accounts enable the purchase of that elevated product to our customers and it will enable the desired purchase. Excuse me. So importantly, we have got 17.4 million unique loyalty customers and a total of 24.3 million memberships to Truworths.

Speaker #1: So that's what we're calling the architecture of aspiration. And it's really, we believe, our key strategy for growth in truest. So the merchandise has to be desirable, and then importantly, our accounts enable the purchase of that elevated product to our customers, and supports the it will enable the desire purchase.

Speaker #1: And sorry, excuse me. So importantly, we've got 17.4 million unique loyalty customers, and a total of 24.3 million memberships to truest; in other words, people we're able to communicate with, which is a significant percentage of the potential adult customer base in South Africa, but Manny will talk a little bit further about that.

Sarah Proudfoot: In other words, people we are able to communicate with, which is a significant percentage of the potential adult customer base in South Africa. Manny will talk a little bit further about that.

Speaker #2: Okay, so I'll go through the financial review. You've seen the results, so I won't spend much time on it, and I'll try to catch up a bit.

Emanuel Cristaudo: Okay. I will go through the financial review. You have seen the results, so I will not spend much time on it, and I will try to catch up a bit. I will just start off with saying, how have we done relative to our plans? We launched Fuel Ladies, and we are preparing for the launch of new brands, Daniel Hechter, Villa, and Offspring in summer 2026. Some of those products have gone to stores, very early days, but we are quite excited about that. As Sarah Proudfoot mentioned, there has been a lot of progress on product and brand differentiation and elevating our appeal. We managed to sustain gross margin, and in fact, our gross margin increased. There was an accounting change with our cellular sales. If you go like on like as to how we accounted for that before, our gross margin would have increased by 20 bps.

Mannie Cristaudo: Okay. I will go through the financial review. You have seen the results, so I will not spend much time on it, and I will try to catch up a bit. I will just start off with saying, how have we done relative to our plans? We launched Fuel Ladies, and we are preparing for the launch of new brands, Daniel Hechter, Villa, and Offspring in summer 2026. Some of those products have gone to stores, very early days, but we are quite excited about that. As Sarah Proudfoot mentioned, there has been a lot of progress on product and brand differentiation and elevating our appeal. We managed to sustain gross margin, and in fact, our gross margin increased.

Speaker #2: So I'll just start off with saying how have we done relative to our plans. So we launched Phil Ladies and we're preparing for the launch of new brands, Hester, Ovillo, and Offspring.

Speaker #2: In summer 26, some of those products have gone to stores, very early days. But we're quite excited about that. As Sarah mentioned, there's been a lot of progress on product and brand differentiation, and elevating our appeal.

Speaker #2: We managed to sustain gross margin, and in fact, our gross margin increased by, if you take, there was an accounting change with our cellular sales, if you take if you go like on like, as to how we accounted for that before, our gross margin would have increased by 20 bips.

Mannie Cristaudo: There was an accounting change with our cellular sales. If you go like on like as to how we accounted for that before, our gross margin would have increased by 20 bps. We thought that was good in this really tough environment. We consolidated our distribution centers. We have got a state-of-the-art DC with part allocations running and high volumes of replenishment. We acquired the Office UK DC, that was ZAR 105 million, to support the expansion plans of the UK business. Then we refined the Emporium concept. We constantly refine the stores, and we have got some really fantastic slides to show you about our plans around Eastgate and Sandton, which will be the first two of the refined Emporium concept. We invested GBP 12 million in Office UK store development. We opened eight stores, and the weighted average trading space growth was at 8.1%.

Speaker #2: So we thought that was good in this really tough environment. We consolidated our distribution centers, we've got a state-of-the-art DC with part allocations running and high volumes of replenishment, and we are acquired the office UK DC, that was 105 million, to support the expansion plans of the UK business.

Emanuel Cristaudo: We thought that was good in this really tough environment. We consolidated our distribution centers. We have got a state-of-the-art DC with part allocations running and high volumes of replenishment. We acquired the Office UK DC, that was ZAR 105 million, to support the expansion plans of the UK business. Then we refined the Emporium concept. We constantly refine the stores, and we have got some really fantastic slides to show you about our plans around Eastgate and Sandton, which will be the first two of the refined Emporium concept. We invested GBP 12 million in Office UK store development. We opened eight stores, and the weighted average trading space growth was at 8.1%. There is still room to grow stores, and I will show you later what our plans are there. The online contribution performed well.

Speaker #2: And then we refined the Emporium concept. We constantly refine the stores and we've got some really fantastic slides to show you about our plans around Eastgate and Sandton, which will be the first two of the refined Emporium concept.

Speaker #2: We invested 12 million in office UK store development. We opened eight stores and the weighted average trading space growth was at 8.1%. There's still room to grow stores and I'll show you later what our plans are there.

Mannie Cristaudo: There is still room to grow stores, and I will show you later what our plans are there. The online contribution performed well. It went to 21% from 20%, and Truworths Africa is at 8.1% at the moment. Office UK stabilized at 44. I must add that the Truworths online and Office, it has been profitable from day one. We ensure that it is profitable, and we think that we have got really good technology and expertise in this area. We sustained investment in technology. AI is a key component of our strategy going forward, and it is infiltrated in many areas of our business. We returned ZAR 2.8 billion to shareholders through dividends and share buyback.

Speaker #2: The online contribution performed well, it went to 21% from 20%. And Truest Africa is at 8.1% at the moment in office UK stabilized at 44.

Emanuel Cristaudo: It went to 21% from 20%, and Truworths Africa is at 8.1% at the moment. Office UK stabilized at 44. I must add that the Truworths online and Office, it has been profitable from day one. We ensure that it is profitable, and we think that we have got really good technology and expertise in this area. We sustained investment in technology. AI is a key component of our strategy going forward, and it is infiltrated in many areas of our business. We returned ZAR 2.8 billion to shareholders through dividends and share buyback. The share buyback, you will see later, you probably read it, was ZAR 749 million worth of share buyback, and we generated net cash of ZAR 196 million, and that was after the buybacks. If you look at KPIs and what we achieved, we were all within our medium-term targets that we published last year.

Speaker #2: I must add that the online Truest online and office we've never had a it's been profitable from day one. We ensure that it's profitable and we think that we've got really good technology and expertise in this area.

Speaker #2: We sustained investment in technology AI is a key component of our strategy going forward and it's infiltrated in many areas of our business. We returned 2.8 billion rand to shareholders through dividends and share buyback.

Speaker #2: The share buyback you'll see later, you probably read it was 749 million rand's worth of share buyback. And we generated net cash of 196 million.

Mannie Cristaudo: The share buyback, you will see later, you probably read it, was ZAR 749 million worth of share buyback, and we generated net cash of ZAR 196 million, and that was after the buybacks. If you look at KPIs and what we achieved, we were all within our medium-term targets that we published last year. What is interesting, for a long time now, we have outperformed local and international benchmarks. Although some of the KPIs would have reduced slightly from last year, they are really good from local and international norms. This slide here, really, I just want to point out this, is that cash generated from operations, which is down 12.9%, but on a comparable basis, when you take the timing of monthly payments, it decreased by 2%. So, excellent cash generation.

Speaker #2: And that was after the buybacks. If you look at what we KPIs and what we achieved, we were all within our medium-term targets that we published last year.

Speaker #2: And what's interesting for a long time now, we've outperformed local and international benchmarks. So although some of the KPIs would have reduced slightly from last year, they really good from local and international norms.

Emanuel Cristaudo: What is interesting, for a long time now, we have outperformed local and international benchmarks. Although some of the KPIs would have reduced slightly from last year, they are really good from local and international norms. This slide here, really, I just want to point out this, is that cash generated from operations, which is down 12.9%, but on a comparable basis, when you take the timing of monthly payments, it decreased by 2%. So, excellent cash generation. You will see that in the slide later. Gross profit trend, 51.3. I spoke about the change in cellular sales, it would have gone up slightly. So really good, consistent gross profit performance in this market. This you can see, there has been some normalization, particularly this return on equity and return on capital from the post-COVID period.

Speaker #2: This slide here, really I just want to point out this is that cash generated from operations is down 12.9%, but on a comparable basis, when you take the timing of month in payments decreased by 2%.

Speaker #2: So excellent cash generation, you'll see that in the slide later. Gross profit trend, 51.3, I spoke about the change in cellular sales, it would have gone up slightly.

Mannie Cristaudo: You will see that in the slide later. Gross profit trend, 51.3. I spoke about the change in cellular sales, it would have gone up slightly. So really good, consistent gross profit performance in this market. This you can see, there has been some normalization, particularly this return on equity and return on capital from the post-COVID period.

Speaker #2: So really good consistent gross profit performance. In this market. This you can see there's been some normalization. Particularly this return on equity and return on capital from the post-COVID period.

Speaker #2: But these KPIs are still relatively good. And we feel that we've performed reasonably well with these. If you look at our return on invested capital versus WACC, so this is something that's very important to us and we focus on this.

Emanuel Cristaudo: These KPIs are still relatively good, and we feel that we have performed reasonably well with these. If you look at our return on invested capital versus WACC, this is something that is very important to us, and we focus on this. We outperformed WACC. It was 21% to 13%. So we continue to add to our business, and we think that this is a really good measure for us to focus on. I must say, when we build stores, we always look at the return on invested capital. In the UK, it is excellent. It exceeds what we think. Essentially, it exceeds the initial plans. In South Africa, it is a little more difficult, but one must keep investing. We are pleased with this performance. I will not go into the balance sheet. You would have read it, and just for time, I will move on from here.

Mannie Cristaudo: These KPIs are still relatively good, and we feel that we have performed reasonably well with these. If you look at our return on invested capital versus WACC, this is something that is very important to us, and we focus on this. We outperformed WACC. It was 21% to 13%. So we continue to add to our business, and we think that this is a really good measure for us to focus on. I must say, when we build stores, we always look at the return on invested capital. In the UK, it is excellent. It exceeds what we think. Essentially, it exceeds the initial plans. In South Africa, it is a little more difficult, but one must keep investing. We are pleased with this performance. I will not go into the balance sheet. You would have read it, and just for time, I will move on from here.

Speaker #2: We outperformed WACC, it was 21 to 13%. So we continue to add to our business. And we think that this is a really good measure for us to focus on.

Speaker #2: I must say when we build stores, we always look at the return on invested capital. In the UK it's excellent, it exceeds what we think essentially it exceeds the initial plans.

Speaker #2: In South Africa it's a little more difficult, but one must keep investing. But we are pleased with this performance. I won't go into the balance sheet, you would have read it, and just for time, I'll move on from here.

Speaker #2: You can see here that we finished up with net cash of 196 million. And this is after share buybacks of 949 million. And Truest Africa is still sitting at 2 billion rand, that hasn't really moved.

Emanuel Cristaudo: You can see here that we finished up with net cash of ZAR 196 million, and this is after share buybacks of ZAR 949 million. Truworths Africa is still sitting at ZAR 2 billion. That has not really moved, ZAR 2 billion in debt. But from a group perspective, we are sitting at ZAR 196 million of cash, which is, I think, really good, particularly in an environment that we face at the moment. The cash flow analysis will show you that we generated ZAR 4.4 billion of EBITDA cash. We received some interest as per normal. We acquired the Office UK DC. That was ZAR 105 million of the ZAR 267 million CapEx maintenance. We funded the dividends, and there was ZAR 949 million worth of share buybacks.

Mannie Cristaudo: You can see here that we finished up with net cash of ZAR 196 million, and this is after share buybacks of ZAR 949 million. Truworths Africa is still sitting at ZAR 2 billion. That has not really moved, ZAR 2 billion in debt. But from a group perspective, we are sitting at ZAR 196 million of cash, which is, I think, really good, particularly in an environment that we face at the moment. The cash flow analysis will show you that we generated ZAR 4.4 billion of EBITDA cash. We received some interest as per normal. We acquired the Office UK DC. That was ZAR 105 million of the ZAR 267 million CapEx maintenance. We funded the dividends, and there was ZAR 949 million worth of share buybacks.

Speaker #2: 2 billion rand in debt, but from a group perspective, we're sitting at 196 million. Rand of cash, which is, I think, really good, particularly in an environment that we face at the moment.

Speaker #2: The cash flow analysis will show you that we generated 4.4 billion rand of EBITDA cash. We received some interest, as per normal. We acquired the office UK DC, that was 105 million, of the 267 million capex maintenance.

Speaker #2: We funded the dividends and there was 949 million rand worth of share buybacks. And we would have generated 826 million of net cash, excluding the share buybacks, the acquisition of the office DC and the acquisition of some land next to our DC at the airport.

Emanuel Cristaudo: We would have generated ZAR 826 million of net cash. Excluding the share buybacks, the acquisition of the Office DC, and the acquisition of some land next to our DC at the airport. That land was around, I think, about ZAR 52 million that we bought. So really good cash generation. If you look at Truworths Africa, so better H2 performance, as Sarah Proudfoot mentioned, but it has been a tough environment. Gross margin has increased. That is the 54% to the 53.6%. Excluding the cellular change, I think it would have gone up by 30 bps to 54.3% versus 53.6%. So a nice improvement in margin, and that is essentially from less promotional activity. Retail sales, so tough all around. The ones that battled the most were the kids' business and Identity. But generally, it was really tough. Menswear had a relatively decent performance, and they were flat on the prior period.

Mannie Cristaudo: We would have generated ZAR 826 million of net cash. Excluding the share buybacks, the acquisition of the Office DC, and the acquisition of some land next to our DC at the airport. That land was around, I think, about ZAR 52 million that we bought. So really good cash generation. If you look at Truworths Africa, so better H2 performance, as Sarah Proudfoot mentioned, but it has been a tough environment. Gross margin has increased. That is the 54% to the 53.6%. Excluding the cellular change, I think it would have gone up by 30 bps to 54.3% versus 53.6%. So a nice improvement in margin, and that is essentially from less promotional activity. Retail sales, so tough all around. The ones that battled the most were the kids' business and Identity. But generally, it was really tough.

Speaker #2: That land was around, I think, about 52 million, that we bought. So really good cash generation. If you look at Truest Africa, so better second half performance as Sarah mentioned.

Speaker #2: But it has been a tough environment. Gross margin has increased, that's the 54% to the 53.6, excluding the cellular change, I think it would have gone up by 30 bips to 54.3 versus 53.6.

Speaker #2: So a nice improvement in margin and that's essentially from less promotional activity. Retail sales, so tough all around. The ones that battled the most were the kids' business and identity.

Speaker #1: Economic environment, and we have limited upside on stall growth because we already have such a mature and well-positioned stall portfolio in all of the top malls in South Africa.

Speaker #1: with that initiative.

Speaker #2: Okay, thank you. one question here: what is waiting on cash sales post-period end? So, so I'll answer that. So, the first 7 weeks there's, there's— I think there's a, like, an infatuation with the first 7 weeks.

Speaker #2: But generally it was really tough. Men's wear had a relatively decent performance. And they were flat on the prior period. Stores, this is we closed 26 stores and we opened 24, so net two down.

Mannie Cristaudo: Menswear had a relatively decent performance, and they were flat on the prior period. Stores, we closed 26 stores and we opened 24, so net 2 down. Our sales densities at 36,000 are still good considering. If you look at the trend, which is this dotted line that goes across here, the trend is still slightly upwards. On the merchandise inflation trend, this is what Sarah Proudfoot was talking about. We had negative inflation. We typically do not perform that well with negative inflation. So we are expecting positive inflation in this next year, and we will force it where we can by adding more value to the product to increase the inflation. So probably finish at 3.4% or 4%, I would think. GP trend, quite consistent, which is, I think, relatively quite good. Analysis of the trading expenses, I will not go into this.

Emanuel Cristaudo: Stores, we closed 26 stores and we opened 24, so net 2 down. Our sales densities at 36,000 are still good considering. If you look at the trend, which is this dotted line that goes across here, the trend is still slightly upwards. On the merchandise inflation trend, this is what Sarah Proudfoot was talking about. We had negative inflation. We typically do not perform that well with negative inflation. So we are expecting positive inflation in this next year, and we will force it where we can by adding more value to the product to increase the inflation. So probably finish at 3.4% or 4%, I would think. GP trend, quite consistent, which is, I think, relatively quite good. Analysis of the trading expenses, I will not go into this. You can see the detail. Other than the trade receivable costs, so we had an increase in provision.

Speaker #1: We also are sitting in a situation with a really well-established and mature account base, and so the ability to easily scale good new accounts at this point in time also represents a challenge.

Speaker #2: The first 7 weeks is not indicative of what's going to happen in the season. There's a lot of promotional activity that, that, that's going on, and, and so one cannot say, "These are the first 7 weeks, you're trading poorly, and therefore this continues." It's going to continue.

Speaker #2: And our sales density is at 36,000, are still good, considering and if you look at the trend, which is this dotted line, that goes across here, the trend is still slightly upwards.

Speaker #2: But the cash sale performance is down, and I can relate that likely to be the consumer that's under stress. So they're preferring to use credit where they can pay off the installments rather than pay a lump sum off in cash.

Speaker #1: Therefore, in order to achieve the top-line growth that we are very aware of the fact that we need to achieve, it has to be through product.

Speaker #2: On the merchandise inflation trend, this is what Sarah was talking about. We had negative inflation we typically don't perform that well with negative inflation.

Speaker #1: So we are focusing a lot on a strategy that is, well, an illustration that is the essence of our business philosophy, which is the concept of the hero and the pedestal, where the hero is the combination of our product and our brands—which is a very unique offering—and the pedestal.

Speaker #2: So we expecting positive inflation in this next year. And we will force it where we can, by adding more value to the product. To increase the inflation.

Speaker #2: And then, there's, there's one more that I've got time for, because if I look at this, we had 2 o'clock. Given the strong cash generation attractive share metrics in ex- excessive cash offshore, will there be a new, initiating a new share buyback program?

Speaker #2: So probably finished at 3, 4%, I would think. GP trend, quite consistent. Which is, I think, relatively quite good. Analysis of the trading see the detail.

Speaker #1: The platter, which the product is presented on, is made up of the store portfolio, the credit book, and the e-commerce and digital components, and obviously others that form the pedestal of the product.

Speaker #2: So thanks for that question. So, we, we, we can't— we consistently look at share buyback. When we have excess cash, and with the permission of the board, we look to buy back shares regularly.

Mannie Cristaudo: You can see the detail. Other than the trade receivable costs, so we had an increase in provision. The South African economy is quite constrained, and the consumer has some challenges at the moment. I will show you a slide a little later on the TransUnion SA Consumer Credit Index, which indicates some of the concerns in the credit environment. I will just skip through those. This is ZAR 2.8 billion last year to ZAR 2.6 billion this year in profit before finance cost and tax. You know these numbers. In terms of store development or CapEx, I should say, you can see we spent ZAR 186 million on store development, and we spent ZAR 33 million on computer software infrastructure and ZAR 58 million on land buildings and refurbishments. So in totality, we spent ZAR 280 million in CapEx versus the ZAR 467 million last year.

Speaker #2: Other than the trade receivable costs, so we had an increase in provision. The South African economy is quite constrained and there is. The consumer has some challenges at the moment.

Speaker #2: So it's likely that if we have excess cash, and we get approval from the board, we will, we will, continue with our share buybacks.

Speaker #1: Then, very quickly, we are focusing on a product-tiered architecture and really expanding on this, using our brands in a very considered way to build what we're showing you here—a product staircase.

Emanuel Cristaudo: The South African economy is quite constrained, and the consumer has some challenges at the moment. I will show you a slide a little later on the TransUnion SA Consumer Credit Index, which indicates some of the concerns in the credit environment. I will just skip through those. This is ZAR 2.8 billion last year to ZAR 2.6 billion this year in profit before finance cost and tax. You know these numbers. In terms of store development or CapEx, I should say, you can see we spent ZAR 186 million on store development, and we spent ZAR 33 million on computer software infrastructure and ZAR 58 million on land buildings and refurbishments. So in totality, we spent ZAR 280 million in CapEx versus the ZAR 467 million last year. I do not know if you recall, but last year we had the distribution facility that we were applying money into, and that is now fully live and operating very well.

Speaker #2: So. Sorry, guys, but we don't have time. We actually at 2 o'clock now, and really apologize for the technical glitches, and I think there were some glitches even now while I was speaking.

Speaker #2: I'll show you a slide a little later on the TransUnion index, which indicates some of the concerns in the credit environment. So I'll just skip through those.

Speaker #1: We've worked very hard in the last few years at establishing a core range, which was largely absent in the truest offering in volume, and we are very pleased with the progress we've made in this regard. We now feel we have a nice range of well-priced, excellent-quality basic product across the men's, ladies', and kids' product, and we're going to continue to focus on building and scaling that.

Speaker #2: So, please send your, your questions through to investor relations, and we'll answer them as speedily as we can. And thank you for your time, and, and, and we'll see some of you at the conferences the upcoming conferences that we attend.

Speaker #2: This is 2.8 billion rand last year to 2.6 billion rand. This year in profit before finance costs and tax. You know these numbers. In terms of store development or capex, I should say, you can see we spent 186 million rand on store development.

Speaker #2: And we spent 33 million on computer software infrastructure and 58 on land, buildings and refurbishments. So in totality, we spent 280 million rand in capex versus the 467 last year.

Speaker #1: But then it comes to the tiering part. Now, because of our positioning, we can— and we are required to offer to our customers elevated products of a high quality and a high level of fashionability.

Speaker #2: I don't know if you recall, but last year we had the distribution facility that we were applying money into. And that is now fully live and operating very well.

Mannie Cristaudo: I do not know if you recall, but last year we had the distribution facility that we were applying money into, and that is now fully live and operating very well. Cash flow in Truworths is pretty good. You can see that even after we paid the dividends, and Truworths funds the dividends paid completely. So we do not get a contribution from Office in this regard, but we were essentially flat on movement of cash. Office UK, profit before tax up 6% and retail sales up 4.9%. So not a bad performance. The H2 struggled a little relative to the H1, but we are fairly pleased with this performance. An 18.6% trading margin relative to the 18% last year was good. I will not go into this too much.

Speaker #1: So that is the first step, and that's what we're focusing on. But then, importantly, we are specifically tiering up from there with better quality fabrics, more elevated and detailed styling, adding detail into the product as opposed to pursuing cheaper prices.

Speaker #2: Cash flow in Truest is pretty good. You can see that even after we've paid the dividends and Truest funds the dividends paid completely, so we don't get a contribution from office in this regard.

Emanuel Cristaudo: Cash flow in Truworths is pretty good. You can see that even after we paid the dividends, and Truworths funds the dividends paid completely. So we do not get a contribution from Office in this regard, but we were essentially flat on movement of cash. Office UK, profit before tax up 6% and retail sales up 4.9%. So not a bad performance. The H2 struggled a little relative to the H1, but we are fairly pleased with this performance. An 18.6% trading margin relative to the 18% last year was good. I will not go into this too much. This essentially just shows you where the sales come from. So the majority come from the United Kingdom, and we have some sales coming from the Republic of Ireland.

Speaker #2: But we were essentially flat on movement of cash. Office UK, profit before tax up 6% and retail sales up 4.9%. So not a bad performance.

Speaker #1: And then lastly, introducing some top-tier product new ranges to the mix, and they are specifically Heshta and Ovillo, and we can talk to you a little bit more about that.

Speaker #1: So the concept is we've got to make the product more desirable through the entry price point, through the tiering up. We believe that if we do this correctly, the customers will choose to trade up voluntarily, because—

Speaker #2: The second half was a struggle a little relative to the first half. But we are fairly pleased with this performance. And an 18.6% trading margin relative to the 18% last year was good.

Speaker #1: The prices may be higher; the desirability of the product will be greater. This will change and impact our sales mix, and it gives us some inflation.

Speaker #2: I won't go into this too much. This is essentially just shows you where the sales come from. So the majority come from the United Kingdom and we have some sales coming from the Republic of Ireland.

Mannie Cristaudo: This essentially just shows you where the sales come from. So the majority come from the United Kingdom, and we have some sales coming from the Republic of Ireland. From a store perspective, we closed one store, and we opened nine, and approximately 50% of our stores are now renovated or new or renovated in the new format. I will show you some pictures of those. They are looking wonderful. Sales densities are slightly lower than last year, but we still think they are pretty good at GBP 15,000 per square meter. The GP trend, slight decline in GP. There was additional promotional activity in Office relative to last year. Just a slight downtick in the margin. Trading expenses, I will not talk too much about this. We can go through it if you guys have got questions.

Speaker #1: We've been operating in a negative, or in a deflation situation, intentionally for the last few years through the cycle. We're now seeing the opportunity to actually drive some inflation into our mix, which we believe will be very helpful, along with other things, in driving sales growth.

Speaker #2: And from a store perspective, we closed one store and we opened nine. And approximately 50% of our stores are on our renovated or new or renovated in the new format.

Emanuel Cristaudo: From a store perspective, we closed one store, and we opened nine, and approximately 50% of our stores are now renovated or new or renovated in the new format. I will show you some pictures of those. They are looking wonderful. Sales densities are slightly lower than last year, but we still think they are pretty good at GBP 15,000 per square meter. The GP trend, slight decline in GP. There was additional promotional activity in Office relative to last year. Just a slight downtick in the margin. Trading expenses, I will not talk too much about this. We can go through it if you guys have got questions. You just click on the link and ask us. We will try and answer those. Profit before tax, GBP 66.7 million versus GBP 61.5 million last year, and improvements in EBITDA margin and in operating margin.

Speaker #2: And I'll show you some pictures of those. They're looking wonderful. Sales densities, slightly lower than last year, but we still think they're pretty good at 15,000 pounds.

Speaker #1: So that's what we're calling the architecture of aspiration. And it's really, we believe, our key strategy for growth in Truvis. So the merchandise has to be desirable, and then importantly, our accounts enable the purchase of that elevated product to our customers and support—it will enable the desired purchase.

Speaker #2: Per square meter. The GP trend, slight decline in GP there was additional promotional activity in office relative to last year. So just a slight downtick in the gross in the margin.

Speaker #1: And, sorry, excuse me. So, importantly, we've got 17.4 million unique loyalty customers and a total of 24.3 million members to Truvis. In other words, we're able to communicate with the potential adult customer base in South Africa, and we'll talk a bit further about that.

Speaker #2: Trading expenses I won't talk too much about this. We can go through it if you guys have got questions, we can just click on the link and ask us.

Mannie Cristaudo: You just click on the link and ask us. We will try and answer those. Profit before tax, GBP 66.7 million versus GBP 61.5 million last year, and improvements in EBITDA margin and in operating margin. Capital expenditure, you can see most of the bulk of the CapEx is in store renovation and development, where we have invested substantially, and then in our distribution facilities. We mentioned that we bought the DC. It is in Kilmarnock in Scotland. That was a purchase that we made.

Speaker #2: We'll try and answer those. Profit before tax, 66.7 versus 61.5. Last year and improvements in EBITDA or margin. And in operating margin. Capital expenditure, you can see most of the bulk of the capex is in store innovation and development, where we've invested substantially.

Emanuel Cristaudo: Capital expenditure, you can see most of the bulk of the CapEx is in store renovation and development, where we have invested substantially, and then in our distribution facilities. We mentioned that we bought the DC. It is in Kilmarnock in Scotland. That was a purchase that we made. Then we are starting to invest in computer software and infrastructure, putting in a new merchandise management system that should be live in about 18 months. Good cash flow. We would have generated GBP 33.6 million net cash, excluding the dividends paid to Truworths. Those dividends were paid to Truworths to do the share buyback and excluding the DC acquisition. So a highly generative cash business. Account management, I will go through a few slides here. It is an asset to us. It is how we communicate with our customers. Sarah explained that it is part of the pedestal that supports the growth.

Speaker #2: Okay, so I'll go through the financial review. You've seen the results. Again, this is for technical issues. We would have changed for 45% anywhere.

Speaker #2: And then in our distribution facilities. And we mentioned that we bought the DC, it's in Kilmarnock in Scotland. And that was a purchase that we made.

Speaker #2: And then we're starting to invest in computer software and infrastructure. Putting in a new merchandise management system. That should be live in about 18 months.

Mannie Cristaudo: Then we are starting to invest in computer software and infrastructure, putting in a new merchandise management system that should be live in about 18 months. Good cash flow. We would have generated GBP 33.6 million net cash, excluding the dividends paid to Truworths. Those dividends were paid to Truworths to do the share buyback and excluding the DC acquisition. So a highly generative cash business. Account management, I will go through a few slides here. It is an asset to us. It is how we communicate with our customers. Sarah explained that it is part of the pedestal that supports the growth.

Speaker #2: I'm glad it's sorted. So I'll just start off by saying, how have we done relative to our plans? We launched Phil Ladies, and we're preparing for the launch of new brands: Heshta, Ovillo, and Offspring.

Speaker #2: Good cash flow. We would have generated 33.6 million net cash, excluding the dividends paid to Truest. And those dividends were paid to Truest to do the share buyback.

Speaker #2: In summer '26, some of those products have gone to stores. Very early days, but we're quite excited about that. As Sarah mentioned, there's been a lot of progress on product and brand differentiation, and elevating our appeal.

Speaker #2: And excluding the DC acquisition. So a highly generative cash business. Account management, I'll go through a few slides here. So it is an asset to us.

Speaker #2: We managed to sustain gross margin, and in fact, our gross margin increased. If you take—there was an accounting change with our cellular sales.

Speaker #2: If you take—if you go, like, unlike as to how we accounted for that before, our gross margin would have increased by 20 bps.

Speaker #2: It's how we communicate with our customers. Sarah explained that it's part of the pedestal. It supports the growth. So it enables our customers to buy merchandise that is more expensive than many of our competitors.

Speaker #2: So, we thought that was good in this really tough environment. We consolidated distribution centers; we got a state-of-the-art DC with part allocations running and high volumes of replenishment.

Emanuel Cristaudo: It enables our customers to buy merchandise that is more expensive than many of our competitors. We had really good targeted account acquisition strategies, so we opened more new accounts at less cost this year. Loyalty has become a primary origination engine for that. We have got 17.4 million unique loyalty members, and of course, we score those regularly. The ones that came to open an account who then failed, if they then pass, once we rescore them, we offer them an account. That represents about 55% of all new account opens. So it is a tremendous asset. Our PAY3 product, which is our group's in-house Buy Now, Pay Later product, is gaining momentum. It is still relatively small in the grand scheme of things, but we are showing some good traction with this product.

Mannie Cristaudo: It enables our customers to buy merchandise that is more expensive than many of our competitors. We had really good targeted account acquisition strategies, so we opened more new accounts at less cost this year. Loyalty has become a primary origination engine for that. We have got 17.4 million unique loyalty members, and of course, we score those regularly. The ones that came to open an account who then failed, if they then pass, once we rescore them, we offer them an account. That represents about 55% of all new account opens. So it is a tremendous asset. Our PAY3 product, which is our group's in-house Buy Now, Pay Later product, is gaining momentum. It is still relatively small in the grand scheme of things, but we are showing some good traction with this product.

Speaker #2: We had really good targeted account acquisition strategies. So we opened more new accounts at less cost this year. Loyalty has become a primary origination engine for that.

Speaker #2: And we acquired the office UKDC; that was £105 million, to support the expansion plans of the UK business. And then we refined the Emporium concept.

Speaker #2: So we've got 17.4 million unique loyalty members. And of course, we score those regularly. And the ones that came to open an account to then failed, if they then pass once we rescore them, we offer them an account.

Speaker #2: We constantly refine the stores, and we've got some really fantastic slides to show you about our plans around Eastgate and Sandton, which will be the first two of the refined Emporium concept.

Speaker #2: We invested £12 million in Office UK store development. We opened eight stores, and the weighted average trading space growth was 8.1%. There's still room to grow stores, and I'll show you later what our plans are there.

Speaker #2: So that represents about 55% of all new account opens. So it's a tremendous asset. Our Pay3 product, which is our groups in-house buy now pay later product, is gaining momentum.

Speaker #2: The online contribution performed well; it increased to 21% from 20%. Truvis Africa is at 8.1% at the moment, and Office UK stabilized at 44%.

Speaker #2: So it's still relatively small in the grand scheme of things. But we're showing some good traction with this product. Some really good disciplined credit management.

Emanuel Cristaudo: Some really good disciplined credit management and some strides that we have made in customer engagement. We put some new technology in place to enable us to hyper-personalize our communications. AI, of course, as one would imagine, has moved into top gear here in this space with all our scorecards. We run the portfolio with around about 56 scorecards. This is the TransUnion SA Consumer Credit Index. It comes out regularly, and if it dips below 50, and it is currently at 49, it shows debt stress. One can see that this is really to do with the petrol price increase and the pressure on the consumers that it has dipped. When one looks at it, the household income has declined. Lending has increased on credit card and personal loans, which is essentially a sign of distressed borrowing. This is available on the TransUnion website if you want more detail.

Mannie Cristaudo: Some really good disciplined credit management and some strides that we have made in customer engagement. We put some new technology in place to enable us to hyper-personalize our communications. AI, of course, as one would imagine, has moved into top gear here in this space with all our scorecards. We run the portfolio with around about 56 scorecards. This is the TransUnion SA Consumer Credit Index. It comes out regularly, and if it dips below 50, and it is currently at 49, it shows debt stress. One can see that this is really to do with the petrol price increase and the pressure on the consumers that it has dipped. When one looks at it, the household income has declined. Lending has increased on credit card and personal loans, which is essentially a sign of distressed borrowing. This is available on the TransUnion website if you want more detail.

Speaker #2: And some stride that we've made in customer engagement. We put some new technology in place to enable us to personalize hyper-personalize our communications. And then AI, of course, is one would imagine has moved into top gear here in this space with all our scorecards.

Speaker #2: I must add that the online Truworths Online and Office, we've never had a—it's always—it’s been profitable from day one. We ensure that it's profitable, and we think that we've got really good technology and expertise in this area.

Speaker #2: We sustained investment in technology. AI is a key component of our strategy going forward, and it's infiltrated many areas of our business. We returned R2.8 billion to shareholders through dividends and share buybacks.

Speaker #2: We run the portfolio with around about 56 scorecards. This is the TransUnion credit index. It comes out regularly. And if it dips below 50 and it's currently at 49, it shows debt stress.

Speaker #2: The share buyback you'll see later—you probably read it—was R749 million worth of share buyback. And we generated net cash of R196 million.

Speaker #2: And one can see that this is really to do with the petrol price increase and the pressure on the consumers. That it has dipped.

Speaker #2: And that was after the buybacks. If you look at our KPIs and what we achieved, we were all within our medium-term targets that we published last year.

Speaker #2: When one looks at it, the household income has declined. Lending has increased on credit card and personal loans. Which is essentially a sign of distressed borrowing.

Sarah Proudfoot: Good afternoon, everybody, and welcome to this Truworths Group results presentation for the 52 weeks to 28 June 2026. I would like to introduce myself. For those who do not know me, I am Sarah Proudfoot. I am the Co-Deputy CEO. Online today, we have our CEO, Michael Mark, who is currently in New York. Because his Wi-Fi connection is a little bit unstable, he will be listening and joining when possible. Other than that, we have Emanuel Cristaudo, who is the other Joint Deputy CEO and our CFO, and also Reon Smit, who is our Financial Director. We have quite a lot to share with you today.

Speaker #2: And what's interesting is that for a long time now, we've outperformed local and international benchmarks. So although some of the KPIs have reduced slightly from last year, they are really good compared to local and international norms.

Speaker #2: This is available on the TransUnion website if you want more detail. But this shows that there is pressure on the consumer in South Africa.

Emanuel Cristaudo: But this shows that there is pressure on the consumer in South Africa from a credit perspective. Hence, we raised the provision. I was talking about this. We still had 4.5 million account applications, slightly down on last year, but it was more targeted, and we had a better risk approval rate and a better opened percentage as a result of that. The age distribution, 40% of new applicants are younger than 30. Of course, many of them cannot get accounts because they do not have good credit profiles. But they do become loyalty members, and they feed into our pot. Then 58% are younger than 35. Some statistics around the credit book. The number of accounts is essentially flat on last year. The trade receivables book is just slightly up. We increased the provision from 20.8% to 21.7%.

Mannie Cristaudo: But this shows that there is pressure on the consumer in South Africa from a credit perspective. Hence, we raised the provision. I was talking about this. We still had 4.5 million account applications, slightly down on last year, but it was more targeted, and we had a better risk approval rate and a better opened percentage as a result of that. The age distribution, 40% of new applicants are younger than 30. Of course, many of them cannot get accounts because they do not have good credit profiles. But they do become loyalty members, and they feed into our pot. Then 58% are younger than 35. Some statistics around the credit book. The number of accounts is essentially flat on last year. The trade receivables book is just slightly up. We increased the provision from 20.8% to 21.7%.

Speaker #2: From a credit perspective. Hence, we raised the provision. I was talking about this. So we still had four and a half million account applications, slightly down on last year.

Speaker #2: On this slide here, I just want to point out that cash generated from operations was down 12.9%. However, on a comparable basis—when you adjust for the timing of month-end payments—it decreased by 2%.

Speaker #2: But with that was more targeted and we had a better risk approval rate and a better opened percentage as a result of that. The age distribution, 40% of new applicants are younger than 30.

Speaker #2: So, excellent cash generation—you'll see that in the slide later. Gross profit trend, 51.3. I spoke about the change in cellular sales; they would have gone up slightly.

Speaker #2: Of course, many of them can't get accounts because they don't have good credit profiles. But they do become loyalty members and they feed into our pot.

Sarah Proudfoot: This is our agenda, and we are going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results statement. You all know it has been a challenging year for us, and we are a little bit disappointed in the results, understandably. It has been a challenging year for consumers generally, in both the markets in which we operate—both South Africa and the United Kingdom. We feel happy that there are some very nice positives that have come out of these results. The first being that we have protected our margin. We have continued to be highly cash generative. We, in fact, have a cash conversion rate that improved to 97% from 90% in the previous year.

Sarah Proudfoot: This is our agenda, and we are going to try and move through it quite quickly so that we can cover the strategic areas with more of a focus there than on the numbers themselves, which you will have had the opportunity to read from our results statement. You all know it has been a challenging year for us, and we are a little bit disappointed in the results, understandably. It has been a challenging year for consumers generally in both the markets in which we operate, both South Africa and the United Kingdom. We feel happy that there are some very nice positives that have come out of these results. The first being, we have protected our margin. We have continued to be highly cash generative. We, in fact, have a cash conversion rate that improved to 97%, from 90% in the previous year.

Speaker #2: So, really good, consistent gross profit performance. In this market, as you can see, there's been some normalization, particularly in return on equity and return on capital from the post-COVID period.

Speaker #2: And then 58% are younger than 35. Some statistics around the credit book. So number of accounts is essentially flat on last year. The gross that trade receivables book is just slightly up.

Speaker #2: But these KPIs are still relatively good, and we feel that we've performed reasonably well with these. If you look at our return on invested capital versus WACC—

Speaker #2: We increased the provision from 20.8 to 21.7. The accounts you saw this on the previous slide that we made improvements in accounts opened as a percentage of applications and risk approval rate.

Emanuel Cristaudo: The accounts, you saw this on the previous slide, that we made improvements in accounts opened as a percentage of applications and risk approval rate. Then the overdue percentage of debt is sitting at 17%. Is there anything else I can speak on this slide? I think that is about it. I can answer any questions on that. This one here, active account holders available to purchase, 77% versus 79%. We have got a query as to why is the overdue rate the same as last year, but the percentage of account holders able to purchase at period end is slightly lower. One is a value and the other one is a number. So they are two different statistics. We are going to start to talk about aspirational fashion in our strategic initiatives. Just cognizant of times because we have 20 minutes left.

Mannie Cristaudo: The accounts, you saw this on the previous slide, that we made improvements in accounts opened as a percentage of applications and risk approval rate. Then the overdue percentage of debt is sitting at 17%. Is there anything else I can speak on this slide? I think that is about it. I can answer any questions on that. This one here, active account holders available to purchase, 77% versus 79%. We have got a query as to why is the overdue rate the same as last year, but the percentage of account holders able to purchase at period end is slightly lower. One is a value and the other one is a number. So they are two different statistics. We are going to start to talk about aspirational fashion in our strategic initiatives. Just cognizant of times because we have 20 minutes left.

Speaker #2: So this is something that's very important to us, and we focus on this. We outperformed WACC; it was 21% to 13%. So we continue to add to our business.

Speaker #2: And then we the overdue percentage of debtors is sitting at 17%. Is there anything else I can speak on this slide? I think that's about it.

Speaker #2: And we think that this is a really good measure for us to focus on. I must say, when we build stores, we always look at the return on invested capital.

Speaker #2: I can answer any questions on that. This one, yeah, active account holders are available. Purchase 77% versus 79%. We have got a query as to why is the overdue rate the same as last year, but the percentage of account holders able to purchase at period end is slightly lower.

Sarah Proudfoot: We grew Office in the UK by 4.9% in a difficult economy in the UK. Truworths, although we had a very difficult H1, had a much improved H2 of the year. We continued to invest in growth, particularly in store expansion in the UK, and our online contribution grew to 21%. We had more than 20% growth in online in Truworths South Africa. As always, we build on the long term. Truworths is always guided by its business philosophy, and many of you will be familiar with it. It essentially is our beacon and our guide, and it ensures that we always focus on the long term as opposed to reacting unduly to any short-term things happening in the economy or in the business itself.

Speaker #2: In the UK, it's excellent. It exceeds what we think; essentially, it exceeds the initial plans. In South Africa, it's a little more difficult, but one must keep investing.

Speaker #2: One is a value and the other one is a number. So they're two different statistics. We're going to start to talk about aspirational fashion in our strategic initiatives.

Speaker #2: But we're pleased with this performance. I won't go into the balance sheet—you would have read it—and just for time, I'll move on from here.

Speaker #2: Just cognizance of times because we have 20 minutes left. I'll hand over to Sarah to go through these next couple of slides.

Speaker #2: You can see here that we finished up with net cash of R196 million, and this is after share buybacks of R900 million. And Truworths Africa is still sitting at R2 billion.

Emanuel Cristaudo: I will hand over to Sarah to go through these next couple of slides.

Mannie Cristaudo: I will hand over to Sarah to go through these next couple of slides.

Speaker #1: Thank you, Manny. And I'm going to move through quite quickly. We've already spoken about the initiative to elevate the product mix. And the rollout of the new brands.

Sarah Proudfoot: Thank you, Manny, and I am going to move through quite quickly. We have already spoken about the initiative to elevate the product mix and the rollout of the new brands. The one I did not mention was the brand new streetwear brand called Offspring. That is a men's very cool elevated streetwear brand. Then you are familiar with our Fuel Men's brand, which is also a young, energetic street brand. In this period, we introduced Fuel Ladies, and we are very pleased with the early performance of that brand. The basics we continue to scale and develop. Then importantly, the use of our branding, the brands that we have, which our customers love and often think are international brands, by the way. The application in very creative and elevated ways of those brands onto our product to drive aspiration and elevation through that technique.

Speaker #2: That hasn't really moved. Two billion rand in debt, but from a group perspective, we're sitting at 196 million rand of cash, which is, I think, really good, particularly in the environment that we face at the moment.

Speaker #1: The one I didn't mention was the brand new streetwear brand called Offspring. That's a men's very cool street to elevator streetwear brand. And then you're familiar with our fuel ladies brand.

Speaker #2: The cash flow analysis will show you that we generated R4.4 billion of EBITDA cash. We received some interest as per normal. We acquired the Office UKDC.

Speaker #1: Fuel men's brand, which is also a young energetic street brand. And in this period, we introduced fuel ladies. And we're very pleased with the early performance of that brand.

Sarah Proudfoot: Because of that, we invest in organic growth, and we really try—and are successful at—returning our surplus funds to our shareholders. We take action with a clear sense of how those actions are going to enable us to accelerate our business in the long term. Our growth is our challenge in Truworths Africa in particular, and we are very aware of that. Our growth is going to be deliberately driven by a combination of our brand and our product, which is what we call our 'hero,' and we are going to talk to you a little bit more about that. Obviously, by customer and customer engagement, through our very large account base and our very large number of loyalty customers. We believe that we are well positioned to move forward for the next century. We are currently 100—you will be familiar with it.

Sarah Proudfoot: Because of that, we invest in organic growth, and we really try and return—and are successful at returning—our surplus funds to our shareholders. Action with a clear sense of how they are going to enable us to accelerate our business in the long term. Our growth is our challenge in Truworths Africa in particular, and we are very aware of that. Our growth is going to be deliberately driven by a combination of our brand and our product, which is what we call our hero, and we are going to talk to you a little bit more about that. Obviously, by customer and customer engagement through our very large account base and our very large number of loyalty customers. We believe that we are well positioned to move forward for the next century. We are currently 100. You will be familiar with it.

Speaker #2: That was R105 million. Of the R267 million capex maintenance, we funded the dividends, and there was R949 million worth of share buybacks. And we would have generated R826 million of net cash.

Speaker #1: The basics we continue to scale and develop. And then importantly, the use of our branding the brands that we have which our customers love and often think are international brands, by the way.

Speaker #1: The application in very creative and elevated ways of those brands onto our product to drive aspiration and elevation. Through that technique. We continue to have very good quick response capability out of our design division.

Speaker #2: Excluding the share buybacks, the acquisition of the office DC, and the acquisition of some land next to our DC at the airport—the land was around, I think, about $52 million.

Sarah Proudfoot: We continue to have very good quick response capability out of our design division. We are doing a lot of work with virtual product development, which is obviously shortening lead times and improving dynamism in product development. We are investing in a new AI-enabled product lifestyle management system which we are going to be implementing over the next year or two, and a lot of advanced AI integration into the merchandise side of the business as a whole for design, planning, and forecasting. We have seen very nice synergy opportunities between Office and Truworths on the merchandise buying side through supplier collaborations, and also continued synergies within our design centers across men's, ladies, and kids, which are giving wonderful economies of scale. We are testing and scaling the brands Office and Offspring in the UK. We particularly focus on, again, the aspirational tiering up.

Speaker #2: That we bought. So, really good cash generation. If you look at Truworths Africa, so at the second half performance, as Sarah mentioned, it has been a tough environment.

Speaker #1: And we are doing a lot of work with virtual product development, which is obviously shortening lead times and improving dynamism in product development. We are investing in a new AI-enabled product lifestyle management system, which we're going to be implementing over the next year or two.

Speaker #2: Gross margin has increased. That's the 54% to the 53.6%. Excluding the cellular change, I think it would have gone up by 30 basis points to 54.3% versus 53.6%.

Speaker #1: And a lot of advanced AI integration into the merchandise side of the business as a whole for design, planning, and forecasting. And then we've seen very nice synergy opportunities between office and truers on the merchandise buying side through supplier collaborations and then also continued synergies within our design centers across men's ladies and kids, which are giving wonderful economies of scale.

Speaker #2: So, a nice improvement in margin, and that's essentially from less promotional activity. Retail sales—so, tough all around. The ones that battled the most were the kids' business and Identity.

Speaker #2: But generally, it was really tough. Menswear had a relatively decent performance, and they were flat on the prior period. Regarding stores, we closed 26 stores and opened 24.

Sarah Proudfoot: It's an infographic that illustrates our business philosophy. I'm not going to go through it in any detail because many of you are familiar with it, and I think it speaks for itself. Today, we're going to be focusing on telling you quite a lot about the strategy that we have for growth and a fundamental illustration of the essence of our business philosophy. We refer to this as the hero and the pedestal, and it is the relationship that determines everything that we do. To explain it a little bit further, all of which are wholly owned and exclusively available in Truworths stores only. It is that that creates the unique model of our Truworths emporium, which we believe we haven't seen anywhere else in the world. That's the hero.

Sarah Proudfoot: It's an infographic that illustrates our business philosophy. I'm not going to go through it in any detail because many of you are familiar with it, and I think it speaks for itself. Today, we're going to be focusing on telling you quite a lot about the strategy that we have for growth, and a fundamental illustration of the essence of our business philosophy. We refer to this as the hero and the pedestal, and it is the relationship that determines everything that we do. To explain it a little bit further, all of which are wholly owned and exclusively available in Truworths stores only. It is that that creates the unique model of our Truworths Emporium, which we believe we haven't seen anywhere else in the world. That's the hero.

Speaker #1: So we're testing and scaling the brands office and offspring in the UK. So we're particularly focused on, again, the aspirational tiering up. There's a lot of opportunity for offspring as we see it.

Speaker #2: So, net two down, and our sales density is at $36,000. I'm still good, considering. And if you look at the trend, which is this dotted line that goes across here, the trend is still slightly upwards.

Sarah Proudfoot: There is a lot of opportunity for Offspring as we see it. Office is going really well in terms of the expansion there. The MTO, made to order or own brand range of shoes within Office UK has seen an improved performance. We believe there is opportunity to grow that component of the range, and obviously it comes with a higher margin. We have work actively in place at the moment on both warehouse and merchandise planning systems in Office UK. Those will go live in the 2028, the next financial period.

Speaker #1: Office is going really well in terms of the expansion there. And the NTO made to order or own brand range of shoes within office UK has seen an improved performance.

Speaker #2: On the merchandise inflation trend—this is what Sarah was talking about—we had negative inflation. We typically don't perform that well with negative inflation.

Speaker #1: And we believe there's opportunity to grow that component of the range and offset comes with a high margin. And then we've got a work actively in place at the moment on both warehouse and merchandise planning systems in office UK.

Speaker #2: So, expecting positive inflation in this next year, and we will force it where we can by adding more value to the product to increase the inflation.

Speaker #2: So, probably finish at 3.4%, I would think. GP trend, quite consistent, which is, I think, relatively quite good. Analysis of the trading expenses—I won't go into this.

Speaker #1: Those will go live in the 28 the next financial period.

Speaker #2: Thank you, Sarah. I'll quickly go through these. I really want to try to leave some time for questions. So I'll run through these quickly.

Emanuel Cristaudo: Thank you, Sarah. I will quickly go through these. I really want to try to leave some time for questions, so I will run through these quickly. Just as a reminder, this will be published on our website. In fact, I think it is already published at the moment, this presentation. Supply chain, it is really to leverage the Truworths Africa Distribution Center and to make improvements in the way we part allocate. We also need to be looking at reviewing the logistic partnership to reduce costs. Of course, that is a massive cost in a retailer such as ours, so there is a ton of work happening there. We continue to strengthen the supply base and some of the local CMT suppliers we help and support. We are looking to shorten the lead times and in the UK we want to expand capacity, which is why we bought the DC.

Mannie Cristaudo: Thank you, Sarah. I will quickly go through these. I really want to try to leave some time for questions, so I will run through these quickly. Just as a reminder, this will be published on our website. In fact, I think it is already published at the moment, this presentation. Supply chain, it is really to leverage the Truworths Africa Distribution Center and to make improvements in the way we part allocate. We also need to be looking at reviewing the logistic partnership to reduce costs. Of course, that is a massive cost in a retailer such as ours, so there is a ton of work happening there. We continue to strengthen the supply base and some of the local CMT suppliers we help and support.

Speaker #2: You can see the detail. Other than the trade receivable costs, we had an increase in provision. The South African economy is quite constrained and the consumer has some challenges at the moment.

Speaker #2: Just as a reminder, this will be published on our website in fact, I think it's already published at the moment, this presentation. So supply chain, it's really to leverage the truers Africa distribution center and to make improvements in the way we part allocate.

Speaker #2: I'll show you a slide a little later on the TransUnion Index, which indicates some of the concerns in the credit environment. So I'll just skip through those.

Speaker #2: And we also need to be looking at reviewing the logistic partnership to reduce costs. Of course, that's a massive cost in a retailer such as ours.

Sarah Proudfoot: Very importantly, the hero is supported by what we're calling the pedestal, and we are seeing this as a, if you would,

Sarah Proudfoot: Very importantly, the hero is supported by what we're calling the pedestal, and we are seeing this as a—if you would,

Speaker #2: So there's a ton of work happening there. We continue to strengthen the supply base and some of the local CMT suppliers we help and when we support.

Speaker #2: This is R2.8 billion last year, down to R2.6 billion this year in profit before finance costs and tax. You know these numbers. In terms of store development, or capex I should say, you can see we spent R186 million on store development.

Mannie Cristaudo: We are looking to shorten the lead times and in the UK we want to expand capacity, which is why we bought the DC. In terms of the customers, expand the range of the credit products so we can continue to scale PAY3. Then we will commence rolling out with third party Buy Now, Pay Later products. Hopefully, we can get some of those in this side of the year. That is quite, but we will see how that goes. We want to grow the active account base through targeted conversion of the loyalty members, deepen the customer experience with this new product that we purchased, which enables us to personalize our communications. AI integration I spoke about. It is a really low hanging fruit component of use in our business when one talks about credit risk and operations.

Speaker #2: We're looking at to shorten the lead times and in the UK, we want to expand capacity, which is why we bought the DC. In terms of the customers, expand the range of the credit product.

Emanuel Cristaudo: In terms of the customers, expand the range of the credit products so we can continue to scale PAY3. Then we will commence rolling out with third party Buy Now, Pay Later products. Hopefully, we can get some of those in this side of the year. That is quite, but we will see how that goes. We want to grow the active account base through targeted conversion of the loyalty members, deepen the customer experience with this new product that we purchased, which enables us to personalize our communications. AI integration I spoke about. It is a really low hanging fruit component of use in our business when one talks about credit risk and operations. AI has permeated across many aspects of our business. We are going to grow our e-commerce contribution and integrate the Office and Offspring apps into the CRM system.

Speaker #2: And we spent R33 million on computer software infrastructure and R58 million on land, buildings, and refurbishments. So in total, we spent R280 million in capex versus R467 million last year.

Speaker #2: So we can continue to scale pay three. And then we'll commence rolling out with third-party buy now pay later products. Hopefully, we can get some of those in this side of the year it's quite but we'll see how that goes.

Speaker #2: I don't know if you recall, but last year we had the distribution facility that we were applying money into, and that is now fully live and operating very well.

Speaker #2: We want to grow that active account base through targeted conversion of the loyalty members. Deepen the customer experience with this new product that we've purchased, which enables us to personalize our communications.

Speaker #2: Cash flow in Truvids is pretty good. You can see that even after we've paid the dividends—and Truvids funds the dividends paid completely—so we don't get a contribution from Office in this regard.

Speaker #2: AI integration, I spoke about. It's a really low-hanging fruit component of use in our business when you want to talk about credit risk and operations.

Speaker #2: But we were essentially flat on movement of cash. Office UK profit before tax was up 6%, and retail sales were up 4.9%. So, not a bad performance.

Speaker #2: But I'll be the AI is permeated across many aspects of our business. We're going to grow e-commerce contribution and integrate the office and offspring apps into the CRM system.

Mannie Cristaudo: AI has permeated across many aspects of our business. We are going to grow our e-commerce contribution and integrate the Office and Offspring apps into the CRM system. If I talk about retail presence, we have got the largest store opening program planned since COVID. That is in South Africa. I cannot remember the percentage, but I think it is about a 2.5% retail space growth in South Africa. We have got this new Formay concept, which I will show you, which is looking absolutely amazing, and we will continue to roll out the new brands which are showing promise. We have integrated the Sync format into Identity. We will, of course, continue to optimize trading space by introducing new brands. Let us look at here.

Speaker #2: And if I talk about retail presence, we've got the largest store opening program planned since COVID. That's in South Africa. I can't remember the percentage, but I think it's about a two and a half percent retail space growth in South Africa.

Emanuel Cristaudo: If I talk about retail presence, we have got the largest store opening program planned since COVID. That is in South Africa. I cannot remember the percentage, but I think it is about a 2.5% retail space growth in South Africa. We have got this new Formay concept, which I will show you, which is looking absolutely amazing, and we will continue to roll out the new brands which are showing promise. We have integrated the Sync format into Identity. We will, of course, continue to optimize trading space by introducing new brands. Let us look at here. This is transform the in-store customer experience through technology-enabled stores. There is a push to put more technology into our stores. We are always working to reduce fulfillment costs in e-commerce. We want to expand and modernize the Office UK store portfolio. I will show you some slides. Then selectively expand Offspring.

Speaker #2: The second half was a struggle, a little, relative to the first half. But we are fairly pleased with this performance, and an 18.6% trading margin, relative to the 18% last year, was good.

Speaker #2: We've got this new format concept, which I'll show you, which is looking absolutely amazing. And we'll continue to write the new brands, which I'll strength promise.

Speaker #2: I won't go into this too much. This essentially just shows you where the sales come from, and the majority come from the United Kingdom.

Speaker #2: And we've integrated the sync format into our identity. And we'll, of course, continue to optimize trading space by introducing the brands. There's not that let's look at here.

Speaker #2: And we have some sales coming from the Republic of Ireland. And from a store perspective, we closed one store and we opened nine. Approximately 50% of our stores are now renovated or new, or renovated in the new format.

Speaker #2: This is transform the install customer experience through technology-enabled stores. So there is a push to put more technology into our stores. And we always working to reduce performance costs in e-commerce.

Mannie Cristaudo: This is transform the in-store customer experience through technology-enabled stores. There is a push to put more technology into our stores. We are always working to reduce fulfillment costs in e-commerce. We want to expand and modernize the Office UK store portfolio. I will show you some slides. Then selectively expand Offspring. That seems to be an opportunity for us. I will just go through these slides. The new concept is called Formay. We regularly redesign to keep fresh. This one here is in Eastgate in Johannesburg. This is the Truworths entrance, which is absolutely beautiful. It leads into Hey Betty, Inwear, and Ginger Mary.

Speaker #2: And I'll show you some pictures of those. They're looking wonderful. Sales densities are slightly lower than last year, but we still think they're pretty good at £15,000.

Speaker #2: We want to expand and modernize the office UK store portfolio. I'll show you some slides. And then selectively expand offspring. That seems to be an opportunity for us.

Speaker #2: Per square meter, the GP trend shows a slight decline in GP. There was additional promotional activity in Office relative to last year, so just a slight downtick in the gross margin.

Emanuel Cristaudo: That seems to be an opportunity for us. I will just go through these slides. The new concept is called Formay. We regularly redesign to keep fresh. This one here is in Eastgate in Johannesburg. This is the Truworths entrance, which is absolutely beautiful. It leads into Hey Betty, Inwear, and Ginger Mary. This is what we are doing in Hey Betty and what we are doing in Smart Leisure and Formal. You will see Inwear. It is young and fresh and very enticing. OBR & Hemisphere is our jeans wear store. This is a concept that can be rolled out to be a standalone store, but this is what the entrance will look like. It is the first time we have combined men's and ladies in a format such as this into an actual jean store. Truworths Man, that is the entrance there. It is looking actually really good.

Speaker #2: So I'll just go through these slides. With the new concept is called Form A. We regularly redesign to keep fresh. This one here is in Eastgate in Johannesburg.

Speaker #2: Trading expenses—I won't talk too much about this. We can go through it if you guys have got questions. We can just click on the link and ask us.

Speaker #2: This is the truers entrance, which is absolutely beautiful. It leads into Hay Betty Inway and Ginger Mary. This is what we're doing in Hay Betty.

Mannie Cristaudo: This is what we are doing in Hey Betty and what we are doing in Smart Leisure and Formal. You will see Inwear. It is young and fresh and very enticing. OBR & Hemisphere is our jeans wear store. This is a concept that can be rolled out to be a standalone store, but this is what the entrance will look like. It is the first time we have combined men's and ladies in a format such as this into an actual jean store. Truworths Man, that is the entrance there. It is looking actually really good. Some other pictures of the menswear side. You will see Uzzi there. Men's Streetwear on the bottom right. Then we have introduced Fuel Ladies, and that follows our introduction of Fuel Men's, and that is performing well. Context. That is Loads of Living. That is what it will look like. Looks amazing.

Speaker #2: And what we're doing in Smart Leisure and Formal. And you'll see Inway, it's young and fresh and very enticing. OBR and Hemisphere is our jeans wear store.

Speaker #2: We'll try and answer those. Profit before tax, 66.7 versus 61.5 last year, and improvements in EBITDA margin and in operating margin. Capital expenditure—you can see most of the bulk of the capex is in store innovation and development, where we've invested substantially.

Speaker #2: This is a concept that can be rolled out to be a standalone store. But this is what the entrance will look like. And it's the first time we've combined men's and ladies in a format such as this into an actual jeans store.

Speaker #2: And then our distribution facilities. We mentioned that we bought the DC; it's in Kilmarnock, in Scotland. That was a purchase that we made.

Speaker #2: Truers Man, that's the entrance there. It's looking actually really good. Some other pictures of the men's wear side. You'll see Uzi there. Fuel sorry, men's street around the bottom right.

Emanuel Cristaudo: Some other pictures of the menswear side. You will see Uzzi there. Men's Streetwear on the bottom right. Then we have introduced Fuel Ladies, and that follows our introduction of Fuel Men's, and that is performing well. Context. That is Loads of Living. That is what it will look like. Looks amazing. You will see it over there. This is Daniel Hechter, and Sarah Proudfoot did speak about this, leading into Avillo, our upmarket product range. We will still have Daniel Hechter, of course, but this is Daniel Hechter, which is tiered up a few price points, similarly to Avillo. These are just some images of what they will look like in stores. Shoes and accessories area, and our jewelry cash desk and a concept called Scribe that we are experimenting with. It is essentially a stationery concept that we will be experimenting with. Identity, this is the new concept is called Signal.

Speaker #2: And then we're starting to invest in computer software and infrastructure, putting in a new merchandise management system. That should be live in about 18 months.

Speaker #2: And then we've introduced Fuel Ladies. And that follows our introduction of Fuel Men's and that's performing well. Context, that's in loads of living. That's what it'll look like looks amazing.

Speaker #2: Good cash flow. We would have generated R33.6 million net cash, excluding the dividends paid to Truwids. Those dividends were paid to Truwids to do the share buyback.

Mannie Cristaudo: You will see it over there. This is Daniel Hechter, and Sarah Proudfoot did speak about this, leading into Avillo, our upmarket product range. We will still have Daniel Hechter, of course, but this is Daniel Hechter, which is tiered up a few price points, similarly to Avillo. These are just some images of what they will look like in stores. Shoes and accessories area, and our jewelry cash desk and a concept called Scribe that we are experimenting with. It is essentially a stationery concept that we will be experimenting with. Identity, this is the new concept is called Signal.

Speaker #2: You'll see it over there. This is Heshta. And Sarah did speak about this, leading into a villa. Our upmarket product range which is not we'll still have Daniel Heshta, of course, but this is Heshta, which is tiered up a few price points similarly to a villa.

Speaker #2: And excluding the DC acquisition, it's a highly cash-generative business. I'll go through a few slides here on account management—so it is an asset to us.

Speaker #2: It's how we communicate with our customers. Sarah explained that it's part of the pedestal. It supports the growth, so it enables our customers to buy merchandise that is more expensive than many of our competitors.

Speaker #2: So these are just some images of what they'll look like in stores. Shoes and accessories area and our jewelry cash desk and the concept called Scribe that we experimenting with.

Speaker #2: It's essentially a stationary concept that we'll be experimenting with. Identity, this is the new concept is called Signal. This is the entrance what it's going to look like in Eastgate.

Speaker #2: We had really good targeted account acquisition strategies, so we opened more new accounts at less cost this year. Loyalty has become a primary origination engine for that.

Emanuel Cristaudo: This is the entrance, what it is going to look like in Eastgate. You will see a fantastic entrance with men, with Identity ladies, and with kids to entice customers in. The landlords are very excited about this, as we are. You will see this is just some images of what we have done here. Sync that we have introduced in Identities. You can see that the sign there on the top left, then you can see what it looks like on the bottom right. We will be introducing Sync Beauty. Then there will also be a stationary component in Sync. Those will be new experimental brands that we will introduce. Now off to Sandton. Eastgate was really quite different, but we decided to push the envelope a little further in Sandton. This is still in development phase, so still conceptual, but this is what we are talking about.

Mannie Cristaudo: This is the entrance, what it is going to look like in Eastgate. You will see a fantastic entrance with men, with Identity ladies, and with kids to entice customers in. The landlords are very excited about this, as we are. You will see this is just some images of what we have done here. Sync that we have introduced in Identities. You can see that the sign there on the top left, then you can see what it looks like on the bottom right. We will be introducing Sync Beauty. Then there will also be a stationary component in Sync. Those will be new experimental brands that we will introduce. Now off to Sandton. Eastgate was really quite different, but we decided to push the envelope a little further in Sandton. This is still in development phase, so still conceptual, but this is what we are talking about.

Speaker #2: You'll see a fantastic entrance with man with identity ladies and with kids. To entice customers in and the landlords are very excited about this as we are.

Speaker #2: So, we've got 17.4 million unique loyalty members, and of course, we score those regularly. The ones that came to open an account but then failed—if they pass once we re-score them, we offer them an account.

Speaker #2: And you'll see this is just some images of what we've done here. Sync that we've introduced in identities. You can see that the sign there on the top left and then you can see what it looks like on the bottom right.

Speaker #2: So that represents about 55% of all new accounts opened, so it's a tremendous asset. Our Pay3 product, which is our group's in-house buy-now-pay-later product, is gaining momentum.

Speaker #2: And we'll be introducing Sync Beauty. And then there'll also be a stationary component in sync. Those will be new experimental brands that we'll introduce.

Speaker #2: So, it's still relatively small in the grand scheme of things, but we're showing some good traction with this product—some really good, disciplined credit management.

Speaker #2: Now off to Sandton. So Eastgate was really quite different. But we decided to push the envelope a little further in Sandton. And this is still in development phase.

Speaker #2: And some strides that we've made in customer engagement—we put some new technology in place to enable us to personalize, even hyper-personalize, our communications. And then AI, of course, as one would imagine, has moved into top gear here in this space with all our scorecards.

Speaker #2: So still conceptual, but this is what we're talking about. Beautiful round entrances, great architectural features. A massive shop front as you walk. So of course, this is across from Zara.

Emanuel Cristaudo: Beautiful round entrances, great architectural features, a massive shop front as you walk. This is across from Zara in Sandton City. We will have our jeans wear store there as well. It looks like this. We think it is a combination of Selfridges and Zara. You have these pockets of enticement and different feel for each of the brands as you walk through. This over here, where you see this brightly colored area here is Ginger Mary. Quite a different look and feel. Ladies, this is a young fashion concept that we have going here. Ginger Mary, what it is going to look like. This is conceptual, of course, but should be something close to this in any way. Then just to the UK now. Now we are in a fantastic location in Carnaby Street for Offspring. We will be building an Offspring store there.

Mannie Cristaudo: Beautiful round entrances, great architectural features, a massive shop front as you walk. This is across from Zara in Sandton City. We will have our jeans wear store there as well. It looks like this. We think it is a combination of Selfridges and Zara. You have these pockets of enticement and different feel for each of the brands as you walk through. This over here, where you see this brightly colored area here is Ginger Mary. Quite a different look and feel. Ladies, this is a young fashion concept that we have going here. Ginger Mary, what it is going to look like. This is conceptual, of course, but should be something close to this in any way. Then just to the UK now. Now we are in a fantastic location in Carnaby Street for Offspring. We will be building an Offspring store there.

Speaker #2: We run the portfolio with around about 56 scorecards. This is the TransUnion credit index. It comes out regularly, and if it dips below 50—and it's currently at 49—it shows debt stress.

Speaker #2: In Sandton City. We'll have our jeans wear store there as well. Looks like this. It's a combination, I guess, of we think it's a combination of Selfridges and Zara.

Speaker #2: So you have these pockets of enticement and different feel for each of the brands as you walk through. This over here where you see this brightly colored sort of area here is Ginger Mary.

Speaker #2: And one can see that this is really to do with the petrol price increase and the pressure on the consumers—that it has dipped.

Speaker #2: But a different look and feel. Ladies, this is a young fashion concept that we've got going here. Ginger Mary, what it's going to look like this is conceptual.

Speaker #2: When one looks at it, household income has declined. Lending has increased on credit cards and personal loans, which is essentially a sign of distressed borrowing.

Speaker #2: Of course, but it should be something close to this in an inway. And then just to the UK now. So now we're in a fantastic location in Carnaby Street.

Speaker #2: This is available on the TransUnion website if you want more detail. But this shows that there is pressure on the consumer in South Africa from a credit perspective.

Speaker #2: For offspring, and so we'll be building an offspring store there. This is the rendering of the images. The entrance to offspring. And the first floor.

Emanuel Cristaudo: This is the rendering of the images, the entrance to Offspring and the first floor, which is very exciting. We are also taking Offspring further into Selfridges. This is what the concept looks like. Offspring, this is the Offspring Selfridges men's concept over here. It is really good digital displays that looks fantastic and enticing. These are our Office stores, which we have this new format, and we are rolling this out. It looks beautiful. I will show you some before and after images, and you can see the difference. Here is the before in Belfast High Street. This is what it looked like before. This is after we finished it. This is in Leeds Trinity, what it looked like before. Pretty dark. This is what it looks like afterwards. The landlords love this concept of ours. That is what the stores look like.

Mannie Cristaudo: This is the rendering of the images, the entrance to Offspring and the first floor, which is very exciting. We are also taking Offspring further into Selfridges. This is what the concept looks like. Offspring, this is the Offspring Selfridges men's concept over here. It is really good digital displays that looks fantastic and enticing. These are our Office stores, which we have this new format, and we are rolling this out. It looks beautiful. I will show you some before and after images, and you can see the difference. Here is the before in Belfast High Street. This is what it looked like before. This is after we finished it. This is in Leeds Trinity, what it looked like before. Pretty dark. This is what it looks like afterwards. The landlords love this concept of ours. That is what the stores look like.

Speaker #2: Hence, we raised the provision. I was talking about this. So, we still had 4.5 million account applications—slightly down on last year—but they were more targeted, and we had a better risk approval rate and a better opened percentage as a result of that.

Speaker #2: Which is very, very exciting. And then we also taking offspring further into Selfridges. So this is what the concept looks like. Offsprings, this is the offspring Selfridges men's concept over here.

Speaker #2: It's really good digital displays. It looks fantastic. And enticing. This is our office stores. Which we have this new format and we're rolling this out.

Speaker #2: Regarding the age distribution, 40% of new applicants are younger than 30. Of course, many of them can't get accounts because they don't have good credit profiles.

Speaker #2: But they do become loyalty members, and they feed into our pot. And then 58% are younger than 35. Some statistics around the credit book.

Speaker #2: Looks beautiful. I'll show you some before and after images. And you can see the difference. So here's the before in Belfast High Street. This is what it looked like before.

Speaker #2: This is after we finished it. And this is in Leeds Trinity. What it looked like before. Pretty dark. And this is what it looks like afterwards.

Speaker #2: So, the number of accounts is essentially flat on last year. The growth in the trade receivables book is just slightly up. We increased the provision from 20.8 to 21.7.

Speaker #2: And the landlords love this concept. Of ours. So that's what the stores look like. I'll go through the outlook. Because we have literally nine minutes.

Emanuel Cristaudo: I will go through the outlook because we have literally 9 minutes. You saw this trading, this update, we sent it out. I just want to point out that this increase, the gross profit increase in Truworths Africa in ZAR value and Office UK in GBP value increased by 3%. This is not an increase in the margin percentage. This is an increase in GP, and it is essentially because of lower promotional activity. We remain focused on actions that support the medium term recovery growth. We project into growth some trading space, 1.5% on a weighted average base in Truworths Africa and 16.4% on a weighted average in the UK. Some really good growth in the UK. We believe the group is very well positioned to take advantage of improvements in the macro environment.

Mannie Cristaudo: I will go through the outlook because we have literally 9 minutes. You saw this trading, this update, we sent it out. I just want to point out that this increase, the gross profit increase in Truworths Africa in ZAR value and Office UK in GBP value increased by 3%. This is not an increase in the margin percentage. This is an increase in GP, and it is essentially because of lower promotional activity. We remain focused on actions that support the medium term recovery growth. We project into growth some trading space, 1.5% on a weighted average base in Truworths Africa and 16.4% on a weighted average in the UK. Some really good growth in the UK. We believe the group is very well positioned to take advantage of improvements in the macro environment.

Speaker #2: So you saw this. This trading, this update. We sent it out. I just want to point out that this increase gross profit increase in Truers Africa and RAN value.

Speaker #2: The accounts—you saw this on the previous slide—that we made improvements in accounts opened as a percentage of applications, and risk approval rate.

Speaker #2: And then we – the overdue percentage of debtors is sitting at 17%. Is there anything else I can speak on this slide? I think that's about it.

Speaker #2: And office UK and pound value. Increased by 3%. This is not a margin this is not an increase in the margin percentage. This is an increase in GP.

Speaker #2: And it's essentially because of lower promotional activity. So we remain focused on actions that support the medium-term recovery growth. We reject we project into growth some trading space.

Speaker #2: I can't answer any questions on that. This one here—active account holders available to purchase: 77% versus 79%. We have got a query as to why the overdue rate is the same as last year, but the percentage of account holders able to purchase at period end is slightly lower.

Speaker #2: One and a half percent on an weighted average base in Truers Africa and 16.4% on a weighted average in the UK. So some really good growth in the UK.

Speaker #2: One is a value and the other one is a number, so they're two different statistics. We're going to start to talk about aspirational fashion in our strategic initiatives.

Speaker #2: We believe the group is very well positioned to take advantage of improvements in the macro environment. We're confident that there's a gradual recovery in retail spending over the medium term.

Emanuel Cristaudo: We are confident that there is a gradual recovery in retail spending over the medium term, and the new fashion brands and store concepts will be introduced and trialed to extend the appeal. Growth is expected to be driven primarily through product innovation, through the brand development that Sarah was speaking about, and of course, through customer engagement and improved value extraction. We will leverage off our 2.9 million active customers and our millions of loyalty members. The growth will be supported by the largest planned trading space expansion in recent years, and with continued online sales momentum and further supply chain efficiencies. In the UK, extensive promotional activity may persist, we feel. We are cautiously optimistic. We do believe that with low inflation and stable interest rates, that consumer confidence will return. We think that we are very well positioned for improving market conditions.

Mannie Cristaudo: We are confident that there is a gradual recovery in retail spending over the medium term, and the new fashion brands and store concepts will be introduced and trialed to extend the appeal. Growth is expected to be driven primarily through product innovation, through the brand development that Sarah was speaking about, and of course, through customer engagement and improved value extraction. We will leverage off our 2.9 million active customers and our millions of loyalty members. The growth will be supported by the largest planned trading space expansion in recent years, and with continued online sales momentum and further supply chain efficiencies. In the UK, extensive promotional activity may persist, we feel. We are cautiously optimistic. We do believe that with low inflation and stable interest rates, that consumer confidence will return. We think that we are very well positioned for improving market conditions.

Speaker #2: Just cognizance of time because we have 20 minutes left. I'll hand over to Sarah to go through these next couple of slides.

Speaker #2: And the new fashion brands and store concepts will be introduced and trialed to extend the appeal. Growth is expected to be driven primarily through product innovation through the brand development that Sarah was speaking about.

Speaker #1: Thank you, Manny. I'm going to move through quite quickly. We've already spoken about the initiative to elevate the product mix and the rollout of the new brands.

Speaker #2: And of course, through customer engagement and improved value extraction. We'll leverage off our 2.9 million active customers and our millions of loyalty members and the growth will be supported by the largest planned trading space expansion in recent years.

Speaker #1: The one I didn't mention was the brand new streetwear brand called Offspring. That's a men's, very cool street-to-elevated streetwear brand. And then you're familiar with our Fuel ladies' brand.

Speaker #2: And with continued online sales momentum. And further supply chain efficiencies. In the UK, extensive promotional activity may persist. We feel so we cautiously optimistic.

Speaker #1: Fuel Men's brand, which is also a young, energetic street brand. And in this period, we introduced Fuel Ladies, and we're very pleased with the early performance of that brand.

Speaker #2: But we do believe that with low inflation and stable interest rates, that consumer confidence will return. We think that we very well positioned for improving market conditions.

Speaker #1: We continue to scale and develop the basics. And then, importantly, we focus on the use of our branding—the brands that we have, which our customers love and often think are international brands, by the way—and the application of those brands in very creative and elevated ways onto our products to drive aspiration and elevation.

Speaker #2: We feel that our model is quite differentiated and we can answer some questions on that. And we'll continue to invest in the store portfolio.

Emanuel Cristaudo: We feel that our model is quite differentiated, and we can answer some questions on that, and we will continue to invest in the store portfolio. You have seen the planned growth, and we are planning 16 new stores. Before I go into the questions, just as a reminder, if there are any questions we cannot answer, we will try to answer them through our investor relations mailbox. If you have any questions that you need to send to us after this presentation, please direct them to this mailbox. We have got a team of people that respond. We try to get back to you within 24 hours. I will now go to the questions. Paul has asked from Nedbank, what is your like-for-like revenue growth in Truworths Africa? We do not disclose that.

Mannie Cristaudo: We feel that our model is quite differentiated, and we can answer some questions on that, and we will continue to invest in the store portfolio. You have seen the planned growth, and we are planning 16 new stores. Before I go into the questions, just as a reminder, if there are any questions we cannot answer, we will try to answer them through our investor relations mailbox. If you have any questions that you need to send to us after this presentation, please direct them to this mailbox. We have got a team of people that respond. We try to get back to you within 24 hours. I will now go to the questions. Paul has asked from Nedbank, what is your like-for-like revenue growth in Truworths Africa? We do not disclose that.

Speaker #2: You've seen the planned growth. And we're planning 16 new stores. Before I go into the questions, just as a reminder, if there's any questions, we can't answer, you'll try to answer them through our investor relations mailbox.

Speaker #1: Through that technique, we continue to have very good, quick response capability out of our design division. We are doing a lot of work with virtual product development, which is obviously shortening lead times and improving dynamism in product development.

Speaker #2: And if you have any questions that you need to send to us after this presentation, please direct them to this mailbox. We've got a team of people that respond.

Speaker #1: We are investing in a new AI-enabled product lifecycle management system, which we're going to be implementing over the next year or two, and a lot of advanced AI integration into the merchandise side of the business as a whole for design, planning, and forecasting.

Speaker #2: We try to get back to you within 24 hours. So I'll now go to the questions. Paul's asked from Nedbank what is your life for like revenue growth in Truers Africa.

Speaker #2: We don't disclose that. Paul has also asked to please explain why we have net cash when you actually have 1.8 billion rand in net debt.

Emanuel Cristaudo: Paul has also asked to please explain why we have net cash when you actually have ZAR 1.8 billion in net debt and cash of ZAR 6 million and interest-bearing borrowings of ZAR 1.2 billion. Paul, if you must look at the assets held at fair value, those are our money market assets, and those are sitting at about ZAR 2 billion. Paul has also asked, what is the outlook for operating expense growth in SA and UK? Essentially, we are very good at controlling costs. You can see our cost growth was good. In Office, the cost growth will come primarily from new stores, so additional staff costs that we need from there and additional costs related to those. In South Africa, the expense growth is likely to come from the debtors book primarily, but other than that, it is well contained. There is a question here.

Mannie Cristaudo: Paul has also asked to please explain why we have net cash when you actually have ZAR 1.8 billion in net debt and cash of ZAR 6 million and interest-bearing borrowings of ZAR 1.2 billion. Paul, if you must look at the assets held at fair value, those are our money market assets, and those are sitting at about ZAR 2 billion. Paul has also asked, what is the outlook for operating expense growth in SA and UK? Essentially, we are very good at controlling costs. You can see our cost growth was good. In Office, the cost growth will come primarily from new stores, so additional staff costs that we need from there and additional costs related to those. In South Africa, the expense growth is likely to come from the debtors book primarily, but other than that, it is well contained. There is a question here.

Speaker #1: And then we've seen very nice synergy opportunities between Office and Crewers, on the merchandise buying side through supplier collaborations, and then also continued synergies within our design centers across men's, ladies, and.

Speaker #2: And cash of 6 million and interest bearing borrowings of 1.2 billion. And Paul, if you must look at the assets held at fair value, that's our money market assets.

Speaker #2: And those are sitting at about 2 billion rand. Paul has also asked what is the outlook for operating expense growth in SA and UK.

Speaker #1: Which are giving wonderful economies of scale. So we're testing and scaling the brands Office and Offspring in the UK. So we're particularly focused on, again, the aspirational tiering up.

Speaker #2: We essentially we are very good at controlling costs. You can see our cost growth was good. In office, the cost growth will come primarily from new stores.

Speaker #1: There's a lot of opportunity for Offspring as we see it. Office is going really well in terms of the expansion there. And the MTO—made to order—or own brand range of shoes within Office UK has seen an improved performance.

Speaker #2: So additional staff costs that we need from there and additional costs related to those. In South Africa, the expense growth is likely to come from the debtors book primarily.

Speaker #1: And we believe there's opportunity to grow that component of the range, and often it comes with a high margin. And then we've got work actively in place at the moment on both warehouse and merchandise planning systems in Office UK.

Speaker #2: But other than that, it's well contained. There's a question here. Marco, when will you retire and spend more time with your loved ones? We joke and we say Marco's loved ones are Sarah, myself, and Rion.

Emanuel Cristaudo: Michael, when will you retire and spend more time with your loved ones? We joke and we say Michael's loved ones are Sarah, myself, and Reon, and other people in the business. But seriously, the nomination committee is comfortable with Michael, and they will decide, and he will decide when it is time to step down. If SA sales come under pressure, to what extent did SA's relatively short winter have on this? We started off winter quite well. It is a good question. We did start off quite well, but June was fairly poor. We look at the weather, and it was perhaps a little milder this year, but we do not really talk like it and look at it. We just focus on what we can do. So it was milder and probably contributed a bit, but I am not too sure by how much.

Mannie Cristaudo: Michael, when will you retire and spend more time with your loved ones? We joke and we say Michael's loved ones are Sarah, myself, and Reon, and other people in the business. But seriously, the nomination committee is comfortable with Michael, and they will decide, and he will decide when it is time to step down. If SA sales come under pressure, to what extent did SA's relatively short winter have on this? We started off winter quite well. It is a good question. We did start off quite well, but June was fairly poor. We look at the weather, and it was perhaps a little milder this year, but we do not really talk like it and look at it. We just focus on what we can do. So it was milder and probably contributed a bit, but I am not too sure by how much.

Speaker #1: Those will go live in '28, the next financial period.

Speaker #2: And other people in the business. But seriously, the nomination committee is comfortable with Marco and they will decide and he will decide when it's time to step down.

Speaker #2: Thank you, Sarah. I'll quickly go through these. I really want to try to leave some time for questions, so I'll run through these quickly.

Speaker #2: Just as a reminder, this will be published on our website. In fact, I think it's already published at the moment, this presentation. So, supply chain—it's really to leverage the Truworths' effort distribution center.

Speaker #2: SA sales can be under pressure. To what extent did SA's relatively short winter have on this? We started off winter quite well. It's a good question.

Speaker #2: We did start off quite well, but June was fairly poor. I don't think we look at the weather and it was perhaps a little milder this year, but we don't really talk like that.

Speaker #2: And to make improvements in the way we part-allocate. We also need to be looking at reviewing the logistics partnership to reduce costs.

Speaker #2: Of course, that's a massive cost in a retailer such as ours, so there's a ton of work happening there. We continue to strengthen the supply base and some of the local CMT suppliers.

Speaker #2: And look at it. We just focus on what we can do. So it was milder and probably contributed a bit, but I'm not too sure by how much.

Speaker #2: We help, and when we support, we're looking to shorten the lead times. In the UK, we want to expand capacity, which is why we bought the DC.

Speaker #2: What level of inflation do you see in Truers Africa in 2027? Answer that's about 3%. Why a change in accounting policy for telecoms revenue?

Emanuel Cristaudo: What level of inflation to see in Truworths Africa in 2027? That is about 3%. Why a change in accounting policy for telecoms revenue? It used to be commission-based. It is now sales-based with a gross margin. That was the partner that we had in the telecoms area asked us to do that. Please can you clarify what the normalized Office UK EBIT margin was and what the profit growth excluding the adjusted and excluding foreign exchange gains? Reon, I do not know if you want to answer that one.

Mannie Cristaudo: What level of inflation to see in Truworths Africa in 2027? That is about 3%. Why a change in accounting policy for telecoms revenue? It used to be commission-based. It is now sales-based with a gross margin. That was the partner that we had in the telecoms area asked us to do that. Please can you clarify what the normalized Office UK EBIT margin was and what the profit growth excluding the adjusted and excluding foreign exchange gains? Reon, I do not know if you want to answer that one.

Speaker #2: In terms of the customers, expand the range of the credit product so you can continue to scale Pay Three, and then we'll commence rolling out with third-party buy now, pay later products.

Speaker #2: So we were it used to be commission-based. It's now sales-based. With a gross margin. And that was the partner that we had in the telecoms area asked us to do that.

Speaker #2: Hopefully, we can get some of those in this side of the year. It’s quite a bit. We’ll see how that goes. We want to grow that active account base through targeted conversion of the loyalty members.

Speaker #2: Please tell you clarify what the normalized office UK EBIT margin was and what the profit growth excluding the adjusted and excluding foreign exchange gains.

Speaker #2: Deepen the customer experience with this new product that we've purchased, which enables us to personalize our communications. AI integration—I spoke about it. It's really a low-hanging fruit component of use in our business when you want to talk about credit risk and operations.

Speaker #2: Rion, I don't know if you want to answer that one.

Speaker #1: Yeah, sure, Manny. We haven't disclosed the full detail, but all the information is in the financial statements. So you can easily calculate it from there.

Reon Smit: Yes, sure, Manny. We haven't disclosed the full detail, but all the information is in the financial statements, so you can easily calculate it from there. Given time, I think I'll leave it at that for now.

Speaker #2: But AI is permeating across many aspects of our business. We're going to grow e-commerce contribution and integrate the Office and Office apps into the CRM system.

Speaker #1: Given the time, I think I'll leave it at that for now.

Speaker #2: This is another question. How does profitability of online versus offline compare? So to one another, in SA and office UK. So what's interesting about online, we've been profitable from day one, but online has a higher contribution of markdown sales.

Emanuel Cristaudo: This is another question. How does profitability of online versus offline compare to one another in SA and Office UK? What's interesting about online, we've been profitable from day one, but online has a higher contribution of markdown sales. When product goes on markdown, online spikes. It spikes more so relatively to the other product that we sell online. So it's probably slightly lower profit, but still very profitable. This is another one. Could you provide some insights surrounding the downtrend in your inventory allowance since 2019? This downtrend is at the same time as your inventory turn has been deteriorating and GP margins have been under pressure. Is this a change of assortment or is there another dynamic that I'm under? So this is insights surrounding sustained downtrend of our inventory allowance. I don't know, Reon, if you want to answer this one.

Mannie Cristaudo: This is another question. How does profitability of online versus offline compare to one another in SA and Office UK? What's interesting about online, we've been profitable from day one, but online has a higher contribution of markdown sales. When product goes on markdown, online spikes. It spikes more so relatively to the other product that we sell online. So it's probably slightly lower profit, but still very profitable. This is another one. Could you provide some insights surrounding the downtrend in your inventory allowance since 2019? This downtrend is at the same time as your inventory turn has been deteriorating and GP margins have been under pressure. Is this a change of assortment or is there another dynamic that I'm under? So this is insights surrounding sustained downtrend of our inventory allowance. I don't know, Reon, if you want to answer this one.

Speaker #2: We've got this new format concept, which I'll show you, and it's looking absolutely amazing. We'll continue to write the new brands, which I strongly promise.

Speaker #2: When product goes on markdown, online spikes. So and it spikes more so relatively to the other product that's that we sell online. So it's probably slightly lower profit, but still very profitable.

Speaker #2: And we've integrated the sync format into our identity. And we'll, of course, continue to optimize trading space by introducing the brands. There's not that. Let's look at here.

Speaker #2: This is another one. Could you provide some insights surrounding this downtrend in your inventory allowance? Since 2019, but this downtrend is at the same time as your inventory turn has been deteriorating.

Speaker #2: This is to transform the in-store customer experience through technology-enabled stores. So there is a push to bring more technology into our stores, and we're always working to reduce performance costs in e-commerce.

Speaker #2: And GP margins have been under pressure. Is this a change of assortment? Or is there another dynamic that I'm under? So this is insights surrounding sustained downtrend of our inventory allowance.

Speaker #2: We want to expand and modernize the Office UK store portfolio. I'll show you some slides, and then selectively expand Offspring. That seems to be an opportunity for us.

Speaker #2: I don't know, Rion, if you want to answer this one.

Speaker #2: So, I'll just go through these slides. The new concept is called Form A. We regularly redesign to keep things fresh. This one here is in Eastgate, in Johannesburg.

Speaker #1: No, Manny, I think all I'll say is that we have always managed our stock in exactly the same way for many, many years. We know exactly where we want to end the season.

Reon Smit: No, Manny, I think all I'll say is that we have always managed our stock in exactly the same way for many, many years. We know exactly where we want to end the season, and we target very specific terminal stock levels. So we're very comfortable with the levels that we are provided at, and as always, we are fully provided at the end of the season, and we're working towards achieving our terminal stock levels.

Speaker #1: And we target very specific terminal stock levels. So we're very comfortable with the levels that we are provided at. And as always, we are fully provided at the end of the season and we're working towards achieving our terminal stock levels.

Speaker #2: This is the Truworths entrance, which is absolutely beautiful. It leads into Hay Betty, Inwear, and Ginger Mary. This is what we're doing in Hay Betty.

Speaker #2: And what we're doing in Smart Leisure and Formal. And you'll see Inway, it's young and fresh and very enticing. OBR and Hemisphere are our jeanswear stores.

Speaker #2: Thank you, Rion. This is one for you, Sarah. What caused the poor performance in kids?

Emanuel Cristaudo: Thank you, Reon. This is one for you, Sarah. What caused the poor performance in kids?

Mannie Cristaudo: Thank you, Reon. This is one for you, Sarah. What caused the poor performance in kids?

Speaker #3: Thanks, Manny. Yeah, kids had a disappointing year. And I think there were some issues with lack of brand, adequate brand differentiation, which the teams are very aware of.

Sarah Proudfoot: Thanks, Manny. Kids had a disappointing year, and I think there were some issues with lack of adequate brand differentiation, which the teams are very aware of, and we have been working very actively to bring in much better brand differentiation, which results in better differentiated products so there isn't internal competition within our brands. I think we're comfortable that good progress is being made with that initiative.

Speaker #2: This is a concept that can be rolled out to be a standalone store, but this is what the entrance will look like. And it's the first time we've combined men's and ladies in a format such as this into an actual jeans store.

Speaker #3: And we have been working very actively to bring in much better brand differentiation, which results in better differentiated products. So there isn't internal competition within our brands.

Speaker #2: Truworths Man, that's the entrance there. It's looking actually really good. Some other pictures of the menswear side. You'll see Uzi there. Fuel. Sorry, Main Street around the bottom right.

Speaker #3: And I think we're comfortable that good progress is being made. With that initiative.

Speaker #2: And then we've introduced Fuel Ladies, and that follows our introduction of Fuel Men's, and that's performing well. Context: that's in Loads of Living. That's what it'll look like—looks amazing.

Speaker #2: Okay, thank you. One question here. What is waiting on cash sales post period end? So I'll answer that. So the first seven weeks, there's I think there's like an infatuation with the first seven weeks.

Emanuel Cristaudo: Okay. Thank you. One question here. What is waiting on cash sales post period end? I will answer that. The first seven weeks, I think there's like an infatuation with the first seven weeks. The first seven weeks is not indicative of what's going to happen in the season. There's a lot of promotional activity that's going on, and one cannot say these are the first seven weeks you're trading poorly, and therefore this continues, it's going to continue. But the cash sale performance is down, and I can relate that likely to be the consumer that's under stress. They're preferring to use credit where they can pay off the installments rather than pay a lump sum or in cash. Then, there's one more that I've got time for, because if I look at this, we are at 2:00.

Mannie Cristaudo: Okay. Thank you. One question here. What is waiting on cash sales post period end? I will answer that. The first seven weeks, I think there's like an infatuation with the first seven weeks. The first seven weeks is not indicative of what's going to happen in the season. There's a lot of promotional activity that's going on, and one cannot say these are the first seven weeks you're trading poorly, and therefore this continues, it's going to continue. But the cash sale performance is down, and I can relate that likely to be the consumer that's under stress. They're preferring to use credit where they can pay off the installments rather than pay a lump sum or in cash. Then, there's one more that I've got time for, because if I look at this, we are at 2:00.

Speaker #2: You'll see it over there. This is Heshta, and Sarah did speak about this—leading into Avila, our upmarket product range, which is not... we'll still have Daniel Heshta, of course, but this is Heshta, which is tiered up a few price points, similarly to Avila.

Speaker #2: The first seven weeks is not indicative of what's going to happen in the season. There's a lot of promotional activity that's going on. And so one cannot say these are the first seven weeks.

Speaker #2: You're trading poorly and therefore this continues. It's going to continue. But the cash sale performance is down. And I can relate that likely to be the consumer that's under stress.

Speaker #2: So these are just some images of what they'll look like in stores: shoes and accessories area, our jewelry cash desk, and a concept called Scribe that we're experimenting with.

Speaker #2: So they're preferring to use credit where they can pay off the installments rather than pay a lump sum off in cash. And then there's one more that I've got time for because if I look at this, we had two o'clock.

Speaker #2: It's essentially a stationary concept that we'll be experimenting with. Identity—this new concept is called Signal. This is the entrance, what it's going to look like in Eastgate.

Speaker #2: Given the strong cash generation attractive share metrics in excessive cash offshore, will you be in initiating a new share buyback program? So thanks for that question.

Emanuel Cristaudo: Given the strong cash generation, attractive share metrics, and excessive cash offshore, will you be initiating a new share buyback program? Thanks for that question. We consistently look at share buyback. When we have excess cash and with the permission of the board, we look to buy back shares regularly. It's likely that if we have excess cash and we get approval from the board, we will continue with our share buybacks. I'm sorry, guys, but we don't have time. We're actually at 2:00 now. Please send your questions through to investor relations, and we'll answer them as speedily as we can. Thank you for your time, and we'll see some of you at the upcoming conferences that we attend. Thanks very much.

Mannie Cristaudo: Given the strong cash generation, attractive share metrics, and excessive cash offshore, will you be initiating a new share buyback program? Thanks for that question. We consistently look at share buyback. When we have excess cash and with the permission of the board, we look to buy back shares regularly. It's likely that if we have excess cash and we get approval from the board, we will continue with our share buybacks. I'm sorry, guys, but we don't have time. We're actually at 2:00 now. Please send your questions through to investor relations, and we'll answer them as speedily as we can. Thank you for your time, and we'll see some of you at the upcoming conferences that we attend. Thanks very much.

Speaker #2: You'll see a fantastic entrance with men’s, women’s, and kids' identity. To entice customers in, and the landlords are very excited about this, as we are.

Speaker #2: So we consistently look at share buyback. When we have excess cash and with the permission of the board, we look to buy back shares regularly.

Speaker #2: And you'll see this is just some images of what we've done here—Sync—that we've introduced in Identities. You can see the sign there on the top left.

Speaker #2: So it's likely that if we have excess cash and we get approval from the board, we will continue with our share buybacks. So I'm sorry, guys, but we don't have time.

Speaker #2: And then you can see what it looks like on the bottom right. And we'll be introducing Sync Beauty. And then there'll also be a stationery component in Sync.

Speaker #2: We actually at two o'clock now. Please send your questions through to investor relations. And we'll answer them as speedily as we can. And thank you for your time and we'll see some of you at the conferences upcoming conferences that we attend.

Speaker #2: Those will be new experimental brands that we'll introduce. Now, off to Sandton. So Eastgate was really quite different, but we decided to push the envelope a little further in Sandton.

Speaker #2: And this is still in the development phase, so still conceptual, but this is what we're talking about: beautiful round entrances, great architectural features, a massive shop front as you walk in.

Speaker #2: So, this is across from Zara in Sandton City. We'll have our jeanswear store there as well. It looks like this. It's a combination—I guess we think it's a combination of Selfridges and Zara.

Speaker #2: So you have these pockets of enticement and a different feel for each of the brands as you walk through. This over here, where you see—

Speaker #2: This brightly colored sort of area here is Ginger Mary. It's got a different look and feel. Ladies, this is a young fashion concept that we've got going here.

Speaker #2: Ginger Mary, what it's going to look like—this is conceptual, of course—but it should be something close to this. And then Inway. And then just to the UK now.

Speaker #2: So now we're in a fantastic location in Carnaby Street for Offspring, and so we'll be building an Offspring store there. This is the rendering of the images—the entrance to Offspring.

Speaker #2: And the first floor, which is very, very exciting. And then we are also taking Offspring further into Selfridges. So this is what the concept looks like.

Speaker #2: Offsprings, this is the Offspring Selfridges men's concept over here. It's really good—digital displays, it looks fantastic and enticing. This is our office stores.

Speaker #2: We have this new format, and we're rolling it out. It looks beautiful. I'll show you some before and after images, and you can see the difference.

Speaker #2: So here's the 'before' in Belfast High Street. This is what it looked like before. This is after we finished it. And this is in Leeds Trinity.

Speaker #2: What it looked like before—pretty dark. And this is what it looks like afterwards. And the landlords love this concept. So that's what the stores look like.

Speaker #2: I'll go through the outlook because we have literally nine minutes. So, you saw this trading update—we sent it out. I just want to point out this increase: gross profit increased in Truworths Africa and RAN value.

Speaker #2: And Office UK and pound value increased by 3%. This is not a margin, this is not an increase in the margin percentage. This is an increase in GP.

Speaker #2: And it's essentially 16.4% on a weighted average in the UK, so some really good growth in the UK. We believe the Group is very well positioned to take advantage of improvements in the macro environment.

Speaker #2: We're confident that there's a gradual recovery in retail spending over the medium term, and that new fashion brands and store concepts will be introduced and trialed to extend their appeal.

Speaker #2: Growth is expected to be driven primarily by product innovation through the brand development that Sarah was speaking about, and of course, through customer engagement and improved value extraction.

Speaker #2: We'll leverage off our 2.9 million active customers and our millions of loyalty members and the growth will be supported by the large. And this relations mailbox.

Speaker #2: And if you have any questions that you need to send to us after this presentation, please direct them to this mailbox. We've got a team of people that respond.

Speaker #2: We try to get back to you within 24 hours. So I'll now go to the questions. That was good. In office, the cost growth will come primarily from new stores.

Speaker #2: The data is booked primarily. But other than that, it's well contained. There's a question here. Marco, when will you retire and spend more time with your loved ones?

Speaker #2: We joke, and we say, "Marco's loved ones are Sarah, myself, and Rion." And other people in the business. But seriously, the nomination committee is comfortable with Marco.

Speaker #2: And they will decide, and he will decide when it's time to step down. I've just been told that we're hanging again. I'm not sure if that's how true that is.

Speaker #2: But I'll just carry on. SA sales can be under pressure. To what extent did SA's relatively short winter have on this? We started off winter quite well.

Speaker #2: It's a good question. We did start off quite well. But June was fairly poor. I don't think we look at the weather and it was perhaps a little milder this year.

Speaker #2: But we don't really talk like that. And look at it. We just focus on what we can do. So it was milder. And probably contributed a bit.

Speaker #2: But I'm not too sure by how much. What level of inflation do you see in Truer's Africa in 2027? Answer that's about 3%. Why a change in accounting policy for telecoms revenue?

Speaker #2: We were it used to be commission-based. It's now sales-based. With a gross margin. And that was the partner that we had in the telecoms area asked us to do that.

Speaker #2: Looks like we're hanging again, guys. I'm not sure. Let's have a look at this. I'll just carry on. Please tell me clarify what the normalized office UK EBIT margin was.

Speaker #2: And what the profit growth, excluding the adjusted and excluding foreign exchange gains. Rion, I don't know if you want to answer that one.

Speaker #1: Yeah, sure. We haven't disclosed the full detail. But all the information is in the financial statements. So you can easily calculate it from there.

Speaker #1: Given the time, I think I'll leave it at that for now.

Speaker #2: Okay. Thank you, Rion. This is another question. How does profitability of online versus offline compare? So to one another, in SA and office UK.

Speaker #2: So what's interesting about online, we've been profitable from day one. But online has a higher contribution of markdown sales. When product goes on markdown, online spikes.

Speaker #2: So and it spikes more so relatively to the other product that we sell online. So it's probably slightly lower profit. But still very profitable.

Speaker #2: This is another one. Could you provide some insights surrounding this downtrend in your inventory allowance? Since 2019. But this downtrend is at the same time as your inventory turn has been deteriorating.

Speaker #2: I don't know, Rion, if you want to answer this one.

Speaker #1: No, I mean, I think all I'll say is that we have always managed our stock in exactly the same way for many, many years.

Speaker #1: We know exactly where we want to end the season. And we target very specific terminal stock levels. So we're very comfortable with the levels that we are provided at.

Speaker #1: And as always, we are fully provided at the end of the season. And we're working towards achieving our terminal stock levels.

Speaker #2: Thank you, Rion. This is one for you, Sarah.