Italtile reports modest retail growth amid challenging building industry conditions

Italtile said there remains little sign of an improvement in the building industry due likely to "disappointingly low" GDP growth and in spite of lower interest rates.

The South African tile, bathroomware and home finishing products manufacturer, distributor and retailer said in an update on Monday that system-wide retail turnover reported by the group brands, CTM, Italtile Retail and TopT, rose by 1.2% for the period to November 30, 2025 from July 1, 2025, compared with the same period a year before.

In the integrated supply chain businesses, Retail had been destocking and sales from these businesses were lower due to less seaborne imports. Combined manufacturing sales by Ceramic Industries and Ezee Tile Adhesive Manufacturers to both the group and third-party customers, declined by 6.2% compared to the prior period.

Capacity utilisation fell slightly year-on-year at Ceramic Industries. While efficiencies improved, margins were under pressure due to predatory pricing.

"The global and South African macro-economic challenges have persisted into the new financial year. The market has continued to experience pressure from low priced imports causing a decline in revenue at Ceramic Industries," the group's directors said.

In Retail, some green shoots in the project market were "encouraging", while retail tile volumes increased as market share was gained and average selling prices continued to decrease compared to the prior period.

"Competition remains rife and poor consumer confidence has resulted in continued margin pressure on tile products," the directors said.

They expect that the challenging global and South African macro-economic environment will continue for the rest of their financial year amid global uncertainty and geopolitical conflict.

"Intense competition will persist as a result of the imbalance between excess supply and weak demand, resulting in continued challenges in the trading environment," they said.

"Sound assets, competent, engaged and motivated teams, robust iconic brands, industry-leading technology and products, and the competitive advantage of a vertically integrated supply chain position us well in the current environment and for any upturn in the future," they said. They would continue to focus on retail excellence at every customer touchpoint, improve efficiencies and logistics, enhance customer experience, and grow core competencies in sales and operating excellence, they said.

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