Africa-Press – South-Africa. South Africa’s biggest grocer Shoprite is paying out a record R3.54 billion to shareholder for its 2022 year, after a rebound in liquor sales and a strong performance from its core domestic supermarkets business helped lift profits by over a fifth.
Merchandise sales grew 9.6% to R184 billion in the year to 3 July and profits jumped 21.5% to R5.73 billion, Shoprite said on Tuesday, also reporting R6.2 billon worth of market share gains for its SA business.
The group’s LiquorShop segment also saw sales jump 45.4% to R10.77 billion as Covid-19 trading restrictions eased, with Shoprite raising its total dividend 10.3% to 600c per share.
Despite this, Shoprite’s shares had slipped over 6% on Tuesday morning to around R220.29, but remain positive for the year-to-date.
Shoprite, valued at about R140 billion on the JSE, also trades under the Checkers, Usave and Checkers Hyper banners, and its core SA business accounts for more than three quarters of its sales.
The SA business – 1 789 stores – grew sales by 10.1% to R147.4 billion, with Shoprite saying its focus on store upgrades at Checkers as well as its fresh-food offering, helped pay off with market share gains in the mid-to-upper segment of consumers
The group’s on-demand grocery app, Checkers Sixty60, also continued its growth, now trading from 300 stores, from 233 in the prior year, it said.
Group sales were also lifted by additional stores, with Shoprite opening 181 stores during the year, expanding its continuing operations footprint to 2 989. Store expansion helped offset the effects on sales of the civil unrest in July 2021, which resulted in 177 stores being looted, while 54 sustained fire damage. Shoprite said on Tuesday that 37 stores remain closed, and 10 of these will not reopen.
“We are proud of our 2022 financial results especially when considering our high base, the additional week included in our reporting calendar last year and the headwinds as a result of the challenging local and global context,” CEO Pieter Engelbrecht said in the results.
Shoprite was pleased to continue its growth momentum in terms of customers, said Engelbrecht, while “Checkers Sixty60 continued to innovate and grow its sales despite reporting against an incredible growth trajectory established subsequent to its introduction two years ago.”
The group said on Tuesday it plans to open a record 275 new stores in its 2023 year, while it was also pleased to see sales in its SA supermarkets business in the first month of its new financial year grow by more than the 10.1% it reported for 2022.
Shoprite said, however, its 2023 financial year is expected to remain challenging for its SA customers, who, like many around the world, are facing considerable pressure from high transport, food and borrowing costs. In addition to this, SA’s growth remains constrained by high levels of unemployment and continued power outages, it said.
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