2024

INTEGRATED REPORT

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Overview
Review of 2024 and outlook for 2025 Introducing our 2024 Integrated Report About Truworths International Creating value through sustainability

2

Creating sustainable value
Our Business Philosophy Creating stakeholder value Value-creating business model Managing stakeholder relationships Material issues, risks and opportunities Group strategy

3

Governance
Chairman's report Truworths International board Group leadership Governance creating value Remuneration Committee report

4

Performance review
Retail trading environment Chief Executive Officer's report Five-year review of financial performance Chief Financial Officer's report Summarised Group financial statements

5

Operational review: Truworths
Market-leading brand portfolio Aspirational fashion Supply chain Account management Retail presence Human capital

6

Operational review: Office
Leading brand portfolio Aspirational fashion Supply chain Retail presence Human capital

7

Shareholder information
Shareholder analysis summary Shareholders' diary Forward-looking statements Administration
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OVERVIEW
CREATING SUSTAINABLE VALUE
‘Our ability to create value for our shareholders is closely linked to the value we create for our customers, employees, all other stakeholders as well as the broader society in which we trade.’
GOVERNANCE
‘Good governance practices contribute to improved corporate performance, reduce the risk of failure and ensure the sustainability of the business.’
Governance
‘We again achieved or exceeded our medium-term financial targets and sustained the gross profit on operating margins at world-class levels, far outperforming our local peers.’
OPERATIONAL REVIEW: TRUWORTHS
‘Truworths' brands are premium-quality, aspirational and authentic, and focus on a tasteful blend of colour, fabric and fashion styling in line with international trends but customised for the South African consumer.’
OPERATIONAL REVIEW: OFFICE
‘Office is a sought-after retail partner for the best fashion footwear and top sneaker brands globally and has a unique positioning in the market with a strong focus on the female customer.’
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Group strategy

Our strategy is driven by Our Business Philosophy. This ensures that all strategic decisions are aligned and that the Group remains true to its DNA.

The Business Philosophy is therefore core in determining the Group's strategic objectives, which are delivered through strategies developed and executed within Truworths and Office. Short and medium-term action plans and projects are implemented each year to deliver on the strategies.

These strategies also inform the financial and operational targets for the Group's short and long-term incentive schemes, ensuring that executive reward is aligned with shareholder value creation.

STRATEGIC OBJECTIVES TO DELIVER ON OUR VISION
Time
horizon		 Short term
One to three years		 Medium term
Three to five years		 Longer term
Five to seven years
DELIVERING ON OUR VISION STRATEGIC OBJECTIVES
For our shareholders… Deliver significant shareholder value over time through share price appreciation, dividends and share buy-backs through efficient financial and capital management to ensure long-term growth.
For our customers… Maintain Truworths' aspirational better-end fashion positioning through a mass-market offering of mainly exclusive fashion brands.
Offer Office customers the latest shoe and sneaker styles from leading global brands, complemented by own-brand fashion footwear.
Offer customers access to aspirational merchandise through responsible credit granting (Truworths only) and multiple payment options (Truworths and Office).
Optimise supply chain efficiency to reduce fashion risk and improve our ability to distribute merchandise.
Create an enticing and modern store environment by developing new store concepts and upgrading retail stores.
Create a market-leading omni-channel experience by enhancing our digital capability and creating a seamless in-store and online offering.
For our employees... Attract, develop and retain talent while celebrating and rewarding successful performance.
STRATEGIC ENABLERS
Sound financial, information and operating systems
Strong governance culture and practices
Robust balance sheet and cash generation
Motivated and engaged people
Active stakeholder engagement
Responsible citizenship

LONGER-TERM STRATEGY

We have a long-term mindset. The business has therefore been positioned for the longer term, and we are confident that the factors that currently differentiate the Group will continue to be relevant well into the future.

Our Business Philosophy is constantly reviewed in the context of the ever-evolving operating environment, and adjusted to ensure our business remains relevant and capable of delivering on our Vision for our stakeholders.

Time
horizon		 Short term
One to three years		 Medium term
Three to five years		 Longer term
Five to seven years
LONGER-TERM STRATEGIC OBJECTIVES DRIVERS OF LONGER-TERM GROWTH STRATEGY
Maintain aspirational appeal to the emerging and established middle‑class market who aspire to be fashionable and to wear higher‑quality merchandise that makes them look good and feel attractive.
  • Owning a unique and exclusive portfolio of aspirational brands which cater to multiple lifestyles.
  • Developing and growing new brands that cater to the specific lifestyles of our customers.
  • Maintaining strong relationships with premium third-party brands (primarily in Office with leading global footwear suppliers).

Continue enhancing stores with the focus on the Emporium concept and developing new store concepts.

Invest in omni‑channel initiatives and online channels to create a seamless customer experience.

Grow brand equity to build trust and increased customer satisfaction and loyalty.

  • Locating real estate in prime positions.
  • Introducing the Truworths Re-imagined Emporium concept, along with the Truworths Kids Emporium, Identity Megastore and Context in South Africa and the innovative new store design concepts in Office, elevating the store portfolio of the future.
  • Investing in world‑class technology and capability, and applying e‑commerce learnings from the more advanced Office experience to the South African market.
  • Creating new brands with specific lifestyle opportunities and investing in areas where we are under‑represented.
Adapt and respond to changing consumer shopping behaviour and patterns to remain at the forefront of innovation and technology.
  • Lessons learnt from trading through the COVID‑19 pandemic and multiple economic downturns will inform the Group's responses to changing market dynamics in the longer term.
  • Ability to predict fashion trends and adapt these for the markets in which we operate.
Continue to utilise customer accounts as the primary driver and enabler of sales to Truworths' mainstream middle‑income customer.
  • Strategy to be supported by the strength of Truworths' internally funded and managed credit book and credit risk management capability.
Pursue an active capital management strategy to maximise returns to shareholders through a combination of share price appreciation, dividend payments and share buy‑backs.
  • Strategy to be underpinned by a strong balance sheet and robust cash generation.

Maintain focus on organic growth, supported by bolt‑on acquisitions in new and strategic categories where the Group is under‑represented.

Evaluate acquisition opportunities in South Africa and internationally to complement the organic growth strategy.
  • Barriers to entry to replicate the Group's business model are high. South African retailers have proven to be resilient to their international peers entering the South African market, and globally competitive when operating in offshore markets.

2024

INTEGRATED REPORT

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