Africa-Press – South-Africa. Despite a weak first half, SPAR expects a solid recovery in the second half of its 2025 financial year to boost its full-year results. The retailer has also made significant strides in reducing its debt.
This comes as SPAR has been implementing a turnaround strategy to revitalise its business in an increasingly competitive trading environment.
SPAR is one of South Africa’s biggest grocery retailers, competing against other giants like Shoprite and Pick n Pay.
While focused on food retail, SPAR also operates in other retail markets, including construction and pharmaceuticals. The company operates mainly in Southern Africa but also has operations in Europe and Sri Lanka.
On Wednesday, 1 October 2025, SPAR released a business update outlining its performance in the 51 weeks ended 19 September 2025.
This update explained that the trading environment remained highly competitive in 2025, with increased promotional activity across SPAR’s markets.
In this environment, SPAR saw its group sales decline slightly in the first half but recorded an uplift in the second half with 2.8% growth year-on-year.
This comes as SPAR has been in the process of refining its portfolio, with a specific focus on exiting some of its European operations.
The retailer disposed of SPAR Switzerland on 8 September 2025, which allowed it to reduce group net debt by around 30%.
“The group’s funding profile is now streamlined, with all offshore debt ring-fenced and refinancing risk being reduced,” the retailer said.
“Looking ahead, the Group expects net debt and gearing to continue trending lower, supported by stronger free cash flow, reduced finance costs and ongoing disciplined capital expenditure allocation.”
SPAR explained that the second half of its 2025 financial year has delivered tangible improvements across key regions, with stronger sales momentum attributed to focused promotional campaigns and an improvement in inland performance.
However, this positive momentum was inconsistent across all of SPAR’s business units, with Build it coming under particular pressure.
The retailer said Build continued to be impacted by the broader slowdown in construction activity, partially caused by unfavourable weather conditions.
Build it’s sales were also affected by drop shipment timing, although the retailer noted that a partial recovery is expected in the last week of September 2025.
Positive outlook
Positively, SPAR Health demonstrated robust turnover performance in Scriptwise sales, supported by strong sales within the Pharmacy at SPAR network.
SPAR also recently received the green light from South Africa’s Competition Commission to acquire Aptekor Wholesale and Aptekor Sneldiens, a pharmaceutical product wholesaler and its internal courier service.
In addition, SPAR’s Irish business demonstrated resilience in the second half, as its scale and well-established market presence continued to contribute positively to the group’s overall results.
“Overall, the group expects to end the year with improved sales momentum from continuing operations relative to the first half,” the retailer said.
“In Southern Africa, expenses were well managed with opex growth impacted as we continued our investments in strategic initiatives.”
The second half of the year also saw sales momentum in SPAR’s Groceries and Liquor segment improve, supported by stronger promotional execution and enhanced availability.
Like-for-like sales for Groceries and Liquor grew 3.5% year-on-year in the second half, with Liquor sales delivering particularly solid growth.
“We continued to see strong growth in the lower income cluster, with modest growth in the middle and upper income segments,” the retailer said.
Looking forward, SPAR said the consumer environment remains under pressure, with volume declines across Fast-Moving Consumer Goods (FMCG) markets.
“Nevertheless, the stronger top-line performance in the second half, stabilising and improving loyalty, a simpler portfolio, a stronger balance sheet and a continuing disciplined capital framework provide a solid platform for growth and returns over the medium term,” it said.
“The board remains confident in the group’s ability to deliver sustainable shareholder value.”
SPAR added that its board is considering options to return capital to shareholders, including dividends and share buybacks, although this remains dependent on trading conditions and market outlook.
SPAR’s financial results for the 52-week period ended 26 September 2025 will be released on or about 8 December 2025.
The table below shows the performance of SPAR’s business segments in its 2025 financial year.
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