Cashbuild lifted revenue 6% to R12.1bn in the 52 weeks to 28 June, but operating profit fell 15% to R292m. Headline earnings per share declined 8% to 959.9c and basic earnings per share 25% to 786.1c. The board held the total annual dividend at 626c while cutting the final payment 22% to 233c.
The gap between the two earnings measures is explained by a R34.9m loss on the disposal of the group’s Malawi subsidiary and its two stores. That charge does not account for the operating decline. Gross profit rose 8% to R3.07bn and gross margin widened to 25.3% from 24.8%, but operating expenses grew 9%, or 7% excluding the Malawi loss, against revenue growth of 6%. Cost growth outpacing sales, rather than the African exit, is what compressed the operating line.
Growth also came mainly from new space. Revenue at the 297 stores trading before July 2024 rose 2%, while 20 newer stores contributed four of the six percentage points of group growth. Transactions through the tills increased 5% on selling price inflation of 1.5%, indicating modest volume gains at established sites in a market where customers are trading carefully.
New Stores Drive Cashbuild Revenue
| Measure | FY2026 | FY2025 | Change |
|---|---|---|---|
| Revenue | R12,113m | R11,478m | +6% |
| Gross profit | R3,066m | R2,844m | +8% |
| Gross margin | 25.3% | 24.8% | +0.5pp |
| Operating profit | R292m | R344m | –15% |
| Headline earnings | R196.0m | — | –9% |
| Headline earnings per share | 959.9c | 1,040.4c | –8% |
| Basic earnings per share | 786.1c | 1,042.5c | –25% |
| Final dividend | 233.0c | 300.0c | –22% |
| Total dividend | 626.0c | 626.0c | unchanged |
| Net asset value per share | 7,784c | 7,996c | –3% |
Share buybacks softened the per-share picture. Headline earnings fell 9% to R196m while headline earnings per share fell 8%, the difference absorbed by a reduction in shares in issue to 22.78-million from 23.38-million at the date of declaration. Holding the total dividend flat lifts the payout ratio from about 60% of headline earnings to roughly 65%, a decision that returns cash to shareholders from a smaller earnings base.
The store estate continues to be reshaped rather than simply expanded. Cashbuild ended the year with 317 stores after opening nine, closing 11 and refurbishing 19. Six of the closures were P&L Hardware outlets, the format that has absorbed most of the group’s rationalisation in recent years, with several converted into the smaller Cashbuild Small Model Store format, which management says trades more profitably. Three Amper Alles stores were acquired during the period.
The Malawi exit forms part of a wider retreat from harder African markets, with the group citing currency and profitability difficulties there. Of the 27 remaining rest-of-Africa stores, only the Botswana operation now sits outside the rand common monetary area, which materially reduces translation risk on the balance of the portfolio.
Expansion has shifted towards acquisition closer to home. In December the group acquired 60% of Allbuildco Holdings for R96.4m, holding an option over the remaining 40%, valued at R55.3m and payable if profit targets are met over five years.
Cash and short-term funds rose 4% to R2bn. Inventory increased 7%, with stock days steady at 97. Net asset value per share fell to 7,784c from 7,996c. The effective tax rate rose to 29.2% from 26.5%.
Cashbuild is Putting Faith on New Stores to Beat a Retail Slump
The near-term outlook is weaker than the year just reported. Group revenue in the first seven weeks of the new financial year was at similar levels to the comparable period, against 6% growth for the full year, and management expects trading conditions to remain challenging. Elevated energy and food costs continue to erode disposable income among the predominantly cash-paying customers Cashbuild serves, leaving little scope for a rapid recovery in home improvement demand. Deloitte issued an unmodified opinion on the financial statements.