Shoprite attains 10% growth in half year sales supported by home market

SOUTH AFRICA – South African retailer Shoprite has generated an additional R8.3 billion (US$540m) in sales versus the corresponding period to increase sales by 10.0% to R91.1 billion (US$5.94 billion) for the 26 weeks ending 2 January 2022.

The grocer’s headline earnings per share from continuing operations rose by 25% to R5.23 in the 26 weeks to end-January year on year from R4.17, with all its store formats contributing handsomely.

Its businesses in Kenya, Madagascar and Uganda have been classified as discontinued operations in the second half of the 2021 financial year and have been excluded from its headline earnings from continuing operations performance measure.

The positive result was achieved in a period which included ongoing Covid-19 lockdown regulations and the impact of unprecedented political and civil unrest in KwaZulu-Natal and Gauteng provinces where 231 of the group’s stores were damaged and a considerable number of adjacent stores in the affected areas were also closed for a period.

The group’s core business, Supermarkets RSA, making up 79.5% of sales from continuing operations, is represented by 1,748 stores across major trading banners: Shoprite, Usave, Checkers, Checkers Hyper and LiquorShop.

As a segment, Supermarkets RSA achieved 11.3% sales growth with like-for-like stores attaining a 10.7% sales growth.

Customer visits for the period increased by 6.2% and average basket spend increased by 4.8%.

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“We’ve continued to strengthen our core supermarket business by opening new stores, updating existing stores, introducing new products and bringing new trading formats to the market.

“We’ve also evolved our fintech business and ShopriteX, the Group’s tech and innovation hub, which has continued to raise the bar with numerous initiatives,” CEO Pieter Engelbrecht said in a statement.

Checkers upgraded eight of its supermarkets during the six months and opened five new supermarkets, 12 PetShop Science stand-alone premium pet stores and one Little Me stand-alone baby store.

The banner plans to open an additional 11 supermarkets and nine PetShop Science stores by June 2022.

Meanwhile, the retailer’s LiquorShop business, representing 7.4% of Supermarkets RSA’s sales, increased sales by 49.8%. During November 2021 the business launched LiquorShop Online, for home delivery.

The group highlighted that its private-label strategy remains on track with its participation measuring 18.0% for the period.

Shoprite and Usave, which together make up 52.5% of its Supermarkets RSA operating segment increased sales by 7.3%.

Checkers and Checkers Hyper, which make up 40.0% of Supermarkets RSA sale of merchandise, increased sales by 11.4%.

Crossing boarders, its Non-RSA continuing operations in 10 countries contributed 9.4% to Group sales.

Its Zambian business performed well in a high inflation environment, reporting 34.8% sales growth in constant currency translating to a growth of 35.3% in rand terms.

In Angola, its supermarkets business attained 2.1% sales decline in constant currency translating to a 9.4% decline in rands.

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