The Shoprite Group has released its unaudited results for the 26 weeks ended on December 31, 2023, showcasing robust sales growth and a declaration of dividends despite facing challenges in the operating environment.
Sales Growth and Performance
The Group’s core South African supermarket business demonstrated a commendable performance, with a 14.6% increase in sales amounting to R12.4 billion in additional customer spend compared to the same period last year. This growth is particularly noteworthy given the context of a challenging market, with rest-of-market growth standing at 7.6% according to NielsenIQ.
Key highlights from the sales performance include:
| Business Segment | Sales Increase (%) |
|---|---|
| Checkers and Checkers Hyper | 13.7% |
| Shoprite and Usave | 13.1% |
Checkers and Checkers Hyper’s sales surge of 13.7% can be attributed to the successful execution of the brand’s value proposition, along with enhancements in areas such as fresh produce, private label offerings, and the adoption of Checkers Sixty60, which experienced an impressive 63.1% increase in sales over the six-month period.
Shoprite and Usave also contributed significantly to the sales growth, with Shoprite’s acquisition of 51 stores from Massmart Holdings Ltd propelling its sales increase to 13.2%. Usave, the limited assortment discounter, achieved a sales uptick of 12.3%.
Financial Performance
The Group reported a strong financial performance, with notable increases in key financial metrics:
| Key Metrics | Change (%) |
|---|---|
| Trading profit | +10.7% |
| Operating profit | +8.1% |
| Profit before income tax | +3.8% |
| Profit for the period | +4.2% |
| Headline earnings per share | +7.3% |
| Basic earnings per share | +4.6% |
| Dividend per share | +7.7% |
The Board declared an interim dividend of 267 cents per ordinary share, representing a 7.7% increase from the previous period. The dividend will be payable to shareholders on April 2, 2024.
Investment and Growth
Despite the challenging operating environment, the Group remains committed to investing in various aspects of its business, including technology, digital initiatives, supply chain enhancements, store expansions, and employee development. Over the six-month period, the Group added a net of 197 new stores, bringing its total to 3,543 stores. Additionally, the Group created 2,617 new jobs, further demonstrating its commitment to employment growth.
Conclusion
The Shoprite Group’s impressive sales growth, coupled with its strong financial performance and commitment to investment and growth, reflects its resilience and adaptability in navigating challenging market conditions. With a focus on customer satisfaction, innovation, and community impact, the Group continues to position itself as a leader in the South African retail sector.
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