Spar Southern African sales improve by 4.8% during the 48 weeks to end August

SOUTHERN AFRICA – Retail chain, Spar Southern Africa has reported a 4.8% increase in group sales during the 48 weeks to end August from 12.4% of the prior year reflecting the impact of the pandemic on the business.

According to the company’s trading update, turnover for the six months ended 31 March 2020 was reported to increase 7.8%, while the subsequent five months which almost exactly mirror the lockdown period saw sales increase by 1.0%.

It said the core Spar business which is its wholesale business, recorded an 8.7% upswing in sales with like-for-like up 7.5%.

Spar said the core business was adversely impacted by the ban on the sale of cigarettes, which saw turnover declining 30.5 percent for the period and a significant 71.9% decrease in the five months to 28 August 2020, year-on-year.

The liquor business was likewise impacted by a trading ban and reported turnover decline of 16.4% for the period.

“Approximately three of the last five months of trading for the period were lost due to liquor trade bans and this saw sales decline 44.1% in the period post 31 March 2020,” indicated Spar.

Spar Southern Africa forms part of Spar International, which has operations in over 44 countries. The local arm, operating as the Spar Group Ltd, manages operations in Southern Africa, Ireland, Switzerland and Poland.

It said the core Spar business which is its wholesale business, recorded an 8.7% upswing in sales with like-for-like up 7.5%.

International performance

The group sales increased sales by 12.4% from R99.67 billion to R112.04 billion for the period, when compared to the previous corresponding 48-week trading period in 2019.

In Switzerland, Spar saw its turnover rise by 11.4 percent as consumers supported the business despite the lockdown.

SPAR Ireland increased turnover by 5.5% (euro-denominated), despite the negative pandemic impact, and was supported by new business.

The development of the Polish business was frustrated by the COVID-19 restrictions but contributed R1.97 billion to group turnover.

Spar exits Zambia

In Zambia, Spar has been winding up its operations at its corporate stores, while handing over some of the outlets to retailers Pick n Pay and Choppies.

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In a bid to ensure the brand stays operational in the country, Zambian citizen and business man Davies Chintala has negotiated a deal to take over SPAR Crossroads, reported Zambian Business Times.

“SPAR is a powerful brand. Yes there may be some historical issues around it, but we need to move on from that and be an example to people, that as Zambians we can manage and be identified with SPAR as well in the sense that it can also have home grown entrepreneurs setting up and running their own businesses whilst supporting our own local based suppliers and producers of locally made products.  That’s an avenue that people need look at,” Davies said.

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