Lewis Group's 11.1% revenue growth boosted by credit sales

Lewis Group's revenue increased 11.1% in the 9 months to end-December 2023, driven by strong growth in credit sales and other revenue, the furniture, appliances and homeware retailer said in a trading update Tuesday.

It was "a solid performance, despite constrained discretionary consumer spending," the directors said. It is important to differentiate between credit and cash sales when assessing the financial performance of companies, as credit sales carry more risk for the retailer.

Group merchandise sales grew by 7.1%. Credit sales increased by 9.1%, accounting for 69.4% (Dec 2024: 68.2%) of total sales. Cash sales increased by 2.8% for the 9 months.

Group merchandise sales for the third quarter to December 2023 increased by 7.8%, supported by strong Black Friday sales across all brands, following growth of 8.9% and 4.6% for the first and second quarters respectively.

Comparable store sales grew by 4.3% for the 9-month period and 4.9% for the third quarter. Other revenue, consisting of interest income and ancillary services income as well as insurance revenue, benefited from the strong credit sales in recent years, increasing by 16.2% for the 9 months and 15.2% for the third quarter.

The collection rate remained resilient at a "satisfactory" 78.3% for the 9 months (Dec 2024: 79.6%), consistent with the rate reported for the half year to September 2025, the directors said,

Debtor costs grew by 14.8% for the 9-month period and by 16.9% for the third quarter due mainly to the growth in the debtors book and continued macro-economic pressure on consumers.

The share price increased 3.2% to R97.03 on Wednesday morning, a price that has increased substantially from R64.80 last April.

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