Ray of light at struggling South African fashion giant
The Foschini Group (TFG) reported that its African online sales grew 49.2%, driven by the strength of its Bash e-commerce platform, amid a challenging global business environment.
In its condensed consolidated financial statements for the year ended 31 March 2026, TFG reported that online sales contributed 10% of total sales in the fourth quarter of 2025.
Bash was launched by South African e-commerce veterans Claude Hanan and Luke Jedeikin in July 2022, bringing all TFG brands under a single digital shop.
TFG attributed much of Bash’s early success to forward thinking and being able to launch the platform at the right time.
It said it recognised that online retail was still growing in South Africa when Bash was launched. Initially, it was expected that the platform would break even in three years.
“Instead, we reached that milestone in just 18 months,” the company said in a previous update. However, TFG also recognised that the market shifted quickly due to the rise of global competitors.
TFG began integrating Bash into its physical storefronts to increase sales further, and the integration was operational in 1,515 stores by 2025.
By the 2027/28 financial year, the Bash store integration is expected to roll out to an additional 2,500 Foschini Group stores.
TFG said the business would be worth R4.7 billion by 2029 and transform into a “true omnichannel retailer and platform player.”
It said that the Bash delivery service handled over 1.5 million parcels annually, with 59% of orders delivered in under 48 hours at 34% cost.
The platform has benefited from significant investments in its technology to enhance service delivery and customer experience.
In terms of its global business, TFG said that its group online sales grew by 31.7% in the 2026 financial year and now contributed to 14.8% of total retail sales.
The group has reported strong annual performance in its online sales business, even amid broader pressures on its other business segments.
TFG facing headwinds
Beyond online sales performance, the report showed the company facing significant headwinds across its business.
Headline earnings, a metric used to gauge a company’s profitability, were down 33.5% to 675.4 cents per share. This is compared to 1,015.6 cents the year prior.
TFG reported that the group’s operating profit before brand impairments and acquisition costs declined 22.1% year over year.
It was also forced to declare a dividend of 140 cents per share, down 39.1% compared to 230 cents per share in March 2025.
“Group performance was adversely affected by a weaker second half, as trading conditions deteriorated across all operating regions,” it said in the trading statement.
“The impact of softer peak season demand and lower gross margins resulted in negative operating leverage.”
While sales grew in Africa and the UK, Australian sales declined by 1.5% year over year, causing a 27.2% drop in EBIT for the market.
The group’s UK business saw its earnings drop by 65.4%, impacted by weakness in the occasion wear category and disruptions arising from a cyber incident.
It also said a key online concession partner was hit by a cyberattack that disrupted TFG London’s business, further contributing to the earnings slump.
The outlook for TFG was grim across all of its markets, with headwinds expected in Africa, the UK and Australia heading into 2027.
“The South African macroeconomic environment remains challenging, with subdued economic growth and pressure on consumer disposable income continuing to constrain demand,” it said.
“In Australia, inflationary pressures and the recent interest rate increase are expected to weigh on consumer confidence and discretionary spending, which may temper any near-term recovery.”
Meanwhile, TFG London was also experiencing a challenging retail environment in the UK, as the elevated cost of living weighs on consumer spending.
“Profitability will remain dependent on disciplined gross margin and cost management,” it said.
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