South African retail leader TFG sinks to 16-year low, wiping out $606 million

South African retail giant The Foschini Group Ltd. has hit its lowest stock price in 16 years, erasing more than $600 million in shareholder value since the start of 2026 as mounting margin pressure and soft consumer demand take their toll.

Shares of the Cape Town-based merchant on the Johannesburg Stock Exchange (JSE) dropped past their early 2020 low points, hitting levels last recorded in February 2010. The stock traded recently around R52.6 ($3.13) after closing at R51.3 ($3.06) on Friday. The decline reflects a 15.75 percent drop over the past month and a 37 percent plunge since January, knocking R10.16 billion ($606.3 million) off the retailer’s market cap.

TFG’s market cap has declined from R27.6 billion ($1.64 billion) on Jan. 1 to R17.44 billion ($1.04 billion). The downturn makes TFG the worst performer among clothing retailers on the JSE this year. By comparison, competitor Woolworths Holdings has fallen nearly 19 percent over the same period.

South African retail equities face rout

The broad retail sector in South Africa has faced steep selling pressure across the board. The Spar Group leads the industry’s decline with a roughly 50 percent drop this year, while Clicks Group has shed 36 percent and Pick n Pay Stores has slipped 25 percent. Even Shoprite Holdings, long viewed as the market’s most resilient operator, is up just 2.25 percent. 

A string of weak earnings updates helped push the stock down over the past year. At its August 2025 investor presentation, the retailer, which runs outlets across Africa, the United Kingdom, and Australia, cautioned that annual earnings per share would drop between 20 percent and 25 percent. Market sentiment slipped further two months later when the company published its half-year results. 

Management later noted in a full-year update that a late pickup in African retail sales was not enough to offset earlier losses. Sales and profit margins in Africa normalized in the fourth quarter, but the company acknowledged that the rebound came too late to make up for ground lost during the key end-of-year shopping period. As a result, operating profit for the African division fell by a mid-teens percentage point compared to the previous year.

Supply chain expenses weigh on margins

Executive leaders continue to cite high supply chain expenses driven by global uncertainty, alongside cautious spending by everyday shoppers. While management points to ongoing budget cuts and store efficiency efforts, shareholders are waiting for evidence that those steps will boost bottom-line returns.

An unseasonably warm winter in South Africa has created another headache for clothing sellers. Lighter demand for heavy winter coats and knitwear forced TFG, Truworths International Ltd., and Woolworths into extended midseason sales. That excess stock increases the likelihood of further markdowns, which typically squeezes gross margins.

Operations outside Africa offer little relief. TFG reported softer sales in Australia, while tracking its British business has been complicated by the October 2024 purchase of fashion brand White Stuff. Stripping out the White Stuff purchase, TFG’s sales in the UK were flat, highlighting a patchy performance across its global operations.