Holdsport Limited. JSE: HSP

Background of Holdsport
Holdsport Limited is South Africa’s leading retailer of specialist sports and outdoor apparel, with brands including Sportsmans Warehouse, Outdoor Warehouse and Performance Brands. The company’s history dates back to 1986 with the establishment of the first Sportsmans Warehouse store in Rondebosch, Cape Town, which focused on providing sporting enthusiasts with quality branded merchandise at competitive prices. Holdsport shares are available to buy on the Johannesburg Stock Exchange (JSE) in 2011. Today, Holdsport has a nationwide network of 60 stores in South Africa and two in Namibia.
These large-format stores are mostly situated in value centres within recognised retail nodes. The stores are backed up by two large distribution centres. Holdsport employs a total of 1 300 full-time employees and 650 part-time employees. The company has a JSE market cap of R2.5 billion, and Holdsport shares have been a profitable buy for investors.
Holdsport Shares Growth Driver
Holdsport was the pioneer of large-format stores dedicated to goods for sale to the active sport and outdoor enthusiast. The group’s core brand – Sportsmans Warehouse – has been received very well and contributes the majority of the group’s profit across 36 stores. Despite a constrained economy and reduced consumer spending, the retailer continued its strong track record of growth in the 2016 financial year, with a 12.8% increase in sales pushing operating profits up by 20.2% to R281 million. In addition to opening three new large-format stores, a new concept Sportsmans Warehouse store was opened in the Mall of Africa. The company is aiming to roll out more of these smaller stores, with the belief they can trade successfully in a number of mall-based locations.
Outdoor Warehouse also had a relatively strong performance across its 22 stores, with operating profit increasing by 5% to R58 million, on the back of an 11% sales increase.
The group’s newest and most specialised retailer, Performance Brands (which designs, sources and wholesales technical apparel and equipment) had a 24.8% increase in sales and an operating profit increase of 30.9%. Overall, Holdsport enjoyed a net profit of R218.8 million for the year, an increase of 16.4%. A big advantage has been the ability of the company to fund required capital expenditure from operational cash flows.
Holdsport has established a leading position within the sporting and outdoor retail market. To cement and improve this position, the group is aiming to increase sales
from existing customers, expand distribution, product range and store base, leverage supply chain excellence and extend its footprint into other areas of sub-Saharan Africa.
Holdsport Group Investor Tip
Holdsport shares have had an exemplary record on the JSE, and are becoming one of the bourse’s highly respected stocks. The live online stocks chart shows that Holdsport share price has doubled since the company first listed. The company continues to achieve attractive margins and a very positive cash flow, whilst managing to pay out handsome dividends.
Holdsport has a relatively defensive acquisition and expansion model, which makes Holdsport shares a solid buy for patient investors who want steady returns.
Holdsport Major Shareholders
Coronation Asset Management Holdings, STANLIB Asset Management, Old Mutual Investment Group, Investec, Liberty Life.
Sector
Consumer Discretionary
Industry
Retail – Discretionary
Sub industry
Sporting Goods Stores
How to buy Holdsport Group Shares
Holdsport : How to buy Holdsport Group Shares Online
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