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Shares in Steinhoff rally as the company's profits soar

by , 09 September 2014

This afternoon, Steinhoff International released its results for the full-year to the end of June.

The furniture company reported a large growth in profits for the year. Steinhoff also posted a substantial rise in revenue. And it nearly doubled its dividend pay-out for the year.

Let's take a closer look at what Steinhoff revealed…

A weaker rand benefitted Steinhoff

Steinhoff [JSE:SHF] reported a rise in profits of nearly a third, says Fin24. The “world’s second-biggest furniture retailer” benefitted from swings in the exchange rate.

Headline earnings per share came in at 416.7c for the year, says IOL. That’s up from the 323.3c posted for the same period last year.

In spite of an ailing South African economy and cash strapped consumers, Steinhoff is performing well thanks to its significant international exposure, reports BDLive. The furniture company “makes more than three-quarters of its sales” outside of SA.

So far this year, shares in Steinhoff have performed well, notes MoneyWeb. They’re up “about 16%”.

At time of writing, shares in Steinhoff were trading 3.72% higher at R52.38.

A 20% weakening of the rand for the year translated into a 20% increase in sales for the company, says IOL. Sales came in at R117 billion as the weaker rand “boosted the translation of euro-dominated earnings”.

Steinhoff nearly doubled its dividend

Steinhoff pleased investors with a full-year dividend of 150c a share, notes BDLive. That’s up from the 80c paid out last year.

In its results, the company also said that “it was on track to list its European unit in Frankfurt,” reports MoneyWeb. Steinhoff haven’t revealed when this will happen. The European unit “delivers more than 85% of its profits”.

So a robust set of results for Steinhoff, which pleased investors.

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Shares in Steinhoff rally as the company's profits soar
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