Sportsman’s Warehouse ‘trading well’ following lockdown release
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Sportsman’s Warehouse, one of South Africa’s leading suppliers of fishing tackle, has ‘traded well’ since it was released from the lockdown restrictions imposed during COVID-19.
Brian Joffe, CEO of Long4Life, the parent company of the retailer, gave investors a trading update at the annual general meeting of the business earlier this week. He said that Sportsman’s Warehouse reported good sales across all categories of stock except team and school sports.
He added: “The outbreak of the COVID-19 virus and subsequent government-prescribed lockdown has had a significant impact on Long4Life’s various businesses and resulted in materially lower revenues across our sport and recreation divisions. Since lifting the Level Three restrictions, Sportman’s Warehouse has traded well and online sales have been particularly pleasing.
“During the first two months of lockdown we initiated extensive marketing campaigns in all our divisions to maintain consumer awareness across all our brands to ensure they remain top of mind.”
He added that the group’s primary financial objective during the period of closures had been to focus on ‘stringent’ cash management without damaging the long-term outlook of the businesses. “This strategy has been successful to date with the group’s balance sheet remaining resilient with cash balances currently at similar levels to those at the end of February.
“I would like to commend the executive and employee team for their decisive actions in executing various strategic responses to best mitigate the impact of this continuously evolving situation.”
The management actions included curtailing expenditure, deferring capital expenditure where possible without detrimentally impacting the businesses and constant engagement with all of its stakeholders, including customers, employees, franchisees, shareholders, suppliers and landlords.
Joffe added that given the negative trading experience to date and the continued ‘uncertainties’, it is not possible to provide any meaningful guidance of the group’s results to August 31st.
“The group, however, is unlikely to make a trading profit,” he said. “Going forward, we believe the medium-term outlook remains positive for our businesses and we are confident that we will produce a reasonable return in the second half of the financial year.
“Our businesses have well-regarded brands that remain desirable to consumers and relevant in a post-COVID-19 environment.”