The weak performance of TRU continued in FY18 and our analysis shows that TRU SA’s FY18 trading density adjusted for inflation may be 37% lower than that achieved in FY07. Our recent merchandise reviews highlighted some issues which may have contributed to this declining performance, and we believe TRU will need to address its merchandise issues before a recovery is likely. Addressing the pricing perceptions though may put margins at risk, in our view.
