Massmart, a South African retailer with an annual loss of about 1.6 billion rands ($106 million), has announced that it could be in trouble due to damages caused by looters last year during the nation’s civil unrest as well as dropping trading income.
The wholesale group, which Walmart Inc majorly owns and operates in South Africa, has projected that its 2021 headline loss will accumulate between 1.478 billion rands and a whopping 1.571 million rands.
That stands at 60% to 70% more than the loss of 924 million rands revealed in 2020.
It is due to the company’s expanding losses. The economic effect has been felt by 938 million rands and up to 1 billion rands, not counting food companies held for sales like Cambridge and Rhino stores.
The Game general merchandise’s owner experienced a considerable inventory nullification in December due to the recent looting that exploded after President Jacob Zumba was put behind bars for court contempt in July.
The company’s losses after the attack were severe; it affected up to 43 of its stores. They lost 450 million rands in trading profit and 650 million accounting for insurance proceeds, which is why their financial statements face significant impacts on this situation.
For reference, $1 is equal to 14.9747 rands.