South Africa’s Masscash chief executive Kevin Vyvyan-Day to resign

SOUTH AFRICA – Masscash, the food, liquor and general merchandise wholesale division of Massmart, has announced the resignation of the its chief executive officer, Kevin Vyvyan-Day, with effect from the end of August.

Massmart Holding said in a trading update that Vyvyan-Day will be replaced by interim chief executive Deepa Sita.

According to the trading update, Masscash is expected to report a trading loss of between US$12.25 million (R180m) and US$14.3 million (R210m) compared to last year’s trading loss of US$0.27 million (R4m).

“Despite improved sales in the wholesale business, this weak profit performance was caused by margin pressure in that business, weak sales growth in the retail business and expense growth,” the group said.

Massmart, which is expected to release its results on August 29, said that its profits for the six months to end June 2019 were severely hit by weak sales.

“Margins were lower-than-anticipated across all divisions in May and June, which resulted in a disappointing group financial performance for the six months to end June,” the group said.

The Johannesburg Stock Exchange listed retailer said it expected to report a decline in earnings across all of its four divisions mainly impacted by losses in Massdiscounters.

The South African retailer which operates Masscash, Masswarehouse, Massbuild is that Massdiscounters is expected a widen its loss to US$26.89 million (R395m) and US$28.93 million (R425m) compared to last year’s loss of US$6.47 million (R95m).

The loss in the division is expected to turn the group’s headline earnings of US$13.9M (R204.1m) reported last year to a loss of between US$36.08 million (R530m) and US$37.47 million (R550.4m) during the period.

Massmart said the expected results were disappointing for the group. The slide in Massdiscounters has seen its chief executive Albert Voogd resign in July and be replaced by an interim chief executive Andrew Stein.

Massdiscounters also appointed Riaan Turton as finance director and Kathrine Madley as marketing director as well as Neville Hatfield as merchandise director with effect from July.

Masswarehouse is expected to report a trading profit of between US$21.79 million (R320m) and US$25.19 million (R370m), but is 24 to 34percent lower than last year.

“Much of the lower profitability is caused by the soft sales, margin pressure from the lower sales participation of general merchandise and expense growth caused partly by the new Makro store opened in Durban North in March,” the group said.

Massbuild will report a trading profit of between US$22.33 million (R238m) and US$ 18.11 million (R266m), which is 5 to 15percent lower than last year as a result of lower sales and expense growth.

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