Challenging operating conditions and labour instability led to a marginal 2.1% rise in revenue in the nine months to December 2013‚ while debtors' costs soared by 30%‚ the company said in a trading update on Thursday‚ after the local market close.
A Consilium Securities analyst‚ who described the update as "poor"‚ said that "things are not looking great on the furniture side"‚ referring to the weak position of the South African consumers facing high unemployment‚ rising inflation and slow income growth.
Higher interest rate repayments following the Reserve Bank's surprise 50 basis points hike last week‚ may see margins in the sector narrow further‚ as consumers curb spending.
At 12.06‚ Lewis was down 5.51% to R59.86‚ slightly off its 9 September 2013 low of R58.50. The stock closed 5.61% lower on Wednesday, 29 January.
Shares of JD Group (JDG)‚ which operates in the same space‚ lost more than 3% in sympathy‚ trading at levels last seen on 10 December.
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