Tag Archives: Shoprite

Pick n Pay CEO questions pace of new store openings in South Africa

Pick n Pay chief executive officer, Sean Summers, says the aggressive expansion across South Africa’s retail sector could undermine long-term profitability.

Speaking after the group’s earnings release on Monday, and reported by Bloomberg, Summers cautioned against retailers who are prepared to just open stores at any cost.

Retail square metreage per capita in South Africa is approaching, or even exceeding, that of the United States, he noted, expressing concern over the sustainability of such rapid physical expansion in a market with much lower consumer spending power.

Company disclosures show that the top five retailers opened more than 700 stores in 2024 and have already added 230 new outlets in early 2025, said Summers.

This comes despite the National Treasury cutting its economic growth forecast to an average of 1.6% over the next three years – down from 1.8% – due to subdued domestic demand and global trade uncertainties.

Pick n Pay’s own strategy has diverged from the expansionist trend. The company is in the midst of a turnaround plan, which has included closing underperforming stores and refocusing efforts on its value segment.

Meanwhile, rivals such as Shoprite and Pepkor continue to scale up their store networks. Pepkor, South Africa’s largest retailer by footprint, reported 168 new store openings in just six months to March 2025—an average of 28 stores per month—as it pushes deeper into value-focused apparel, electronics, and cellular categories.

Shoprite Group, Africa’s largest retailer said in its financial results for the 26 weeks ended 29 December 2024, that it opened 248 stores, with 122 more in the pipeline.

Retailers like Woolworths and Spar are struggling to keep pace. The former is with margin pressure and shifting consumer behaviour towards more affordable shopping baskets, while SPAR is battling to keep market share amid rising competition – particularly from the rapid growth of online grocery platforms.

Analysts warn that without corresponding growth in consumer demand; the sector risks a glut of underutilized retail space.

“Sales densities in South Africa must be much lower than in the US because obviously per capita spending in South Africa is well below the US,” said Charles Allen, a London-based analyst at Bloomberg Intelligence.

“It does make you wonder how people eventually are going to justify the return on the investment.”

Despite pockets of resilience in the value segment, the broader environment remains difficult. High unemployment, stagnant incomes, and slow economic growth continue to limit household spending.

Cape Town opens electricity grid to energy traders after successful pilot

The City of Cape Town is opening its electricity grid to private electricity sales and trading following the conclusion of a successful year-long electricity ‘wheeling’ pilot project.

Wheeling allows participants to buy electricity directly from Independent Power Producers or licenced energy traders using existing municipal grid infrastructure.

Over 562 800 kWhs of power has already been generated and wheeled across the City’s grid between private sector energy traders during the pilot phase.

On average, a home in South Africa uses around 4,500 kWh per year so 562,800 kWh would be enough to power approximately 125 homes for a year.

“In this next phase, the City will promote the scaling up of power trading across our electricity grid between qualifying private sellers, based on bilateral and multi-lateral trading agreements,” said mayor Geordin Hill-Lewis.

“This is the start of a changing role for municipalities in the energy space. If we consider what has been generated just in the pilot, when we scale it up, the numbers get absolutely huge so it is important that we get it right. Thank you to our City teams and private partners who have shown again that Cape Town is leading the efforts to change the energy regime,” the mayor said.

Cape Town’s wheeling pilot phase included three wheeling participants (traders), three generators and three off-takers:

  • Trader (trades the generated energy over the City’s grid)
  • Generator (generator of the wheeled energy)
  • Off-taker (receiver of the wheeled energy)

Trader: Enpower Trading
Generator: FairBridge Mall, Brackenfell
Off-taker: Shoprite Head Office, Brackenfell

Trader: Etana Energy
Generator: Constantia Shopping Mall
Off-taker: Growthpoint Properties, City Centre

Trader: Equites Property Fund
Generator: Equites Property Fund Limited, Parow Industria
Off-taker: APF Portside, City Centre

Equites Property Fund said that the transfer of electrons from its generation site in Parow Industria to the off-taker on the Foreshore enabled the company to advance its sustainability objectives.

“We are excited about the prospect of expanding our wheeling capacity beyond the pilot to serve multiple off-takers and look forward to the moderation of wheeling tariffs to encourage greater participation in this transformative initiative,” said Equites Property Fund head of Sustainability, Irshaad Wadvalla.

“By successfully delivering renewable power to Shoprite Checkers over the past year, we have shown that energy wheeling and trading is not just viable but essential to diversifying South Africa’s power supply. We commend the City of Cape Town in paving the way for energy security and economic growth and look forward to continued collaboration in expanding renewable energy access,” said Enpower Trading CEO, James Beatty.

Shoprite joins Checkers in offering Sixty60 delivery service

Shoprite Group, South Africa’s largest retailer, is set to expand its Sixty60 on-demand grocery delivery service to select Shoprite stores, targeting its lower-income customers.

This launch follows a successful pilot in Gauteng and the Western Cape and will roll out across 19 Shoprite stores in eight provinces later this month.

The Sixty60 platform, which first debuted at Checkers in 2019, has experienced a remarkable surge in popularity.

Shoprite’s decision to extend this service to its namesake stores underscores its commitment to providing convenient and affordable grocery delivery to a wider range of customers.

The rollout will be phased to ensure each new location upholds the high standards of excellence and efficiency that have become synonymous with Sixty60.

The service is already live at Shoprite’s Atlantis store in the Western Cape and its Jabulani store in Soweto, Gauteng.

The next phase of expansion will include the launch of Sixty60 in Kleinmond, Western Cape, and Ga-Nala, Mpumalanga, later this month.

Checkers Sixty60, which saw sales grow by 47.1% in the first half of 2024, now services 601 stores, up from 505 stores in the previous period.

It has become one of the key disruptors in the South African retail market, accelerating the shift to online shopping, especially post-Covid.

In a strategic move to enhance its on-demand service, Shoprite acquired an additional 50% stake in its joint venture, Pingo Delivery, on 25 October 2024.

This acquisition secures the Group’s last-mile logistics, ensuring the continued growth and reliability of Checkers Sixty60’s grocery delivery offering.

In terms of growth, Shoprite’s supermarket business saw a 6.7% increase in sales.

Over the past 12 months, the chain opened 30 new stores, bringing its total to 660 stores. During the six-month interim period, 21 new supermarkets were added to its network.

Shoprite Group plots a roadmap for future growth – and it’s a lot

The Shoprite Group announced the opening of a net total of 283 stores over the past 12 months, contrasting with its competitors, Pick n Pay and Spar, which have been scaling back operations in South Africa.

The retailer reported its interim financial results for the 26 weeks ending 29 December 2024 highlighting strong growth across all segments, with its core South African Supermarkets division surpassing R100 billion in sales for the period.

Key financial information

-Group revenue increased by 9.4% to R130.8 billion
-Group sale of merchandise increased by 9.6% to R128.6 billion
-Supermarkets RSA sale of merchandise increased by 10.4% to R107.7 billion
-Diluted headline earnings per share (DHEPS) increased by 9.9% to 659.9 cents
-Interim dividend per share increased by 6.7% to 285 cents (H1 2024: 267

The group increased its workforce by 2 989 people over the six months, to around 163,000 people.

Checkers

Excluding Checkers LiquorShop, the Checkers banner increased sales by R5.2 billion to R43.7 billion for the six months, increasing sales by 13.5%.

Checkers Sixty60, the group’s on-demand grocery delivery app increased sales by 47.1% (H1 2024: 63.1%), expanding the store base from which it serves Checkers customers to 601 stores (H1 2024: 505).

Checkers, inclusive of Checkers Hyper increased its store base over 12 months by a net of 34 stores to end the period with 339 supermarkets.

In terms of store openings and upgrade activity over the six-month interim period under review:

– Checkers and Checkers Hyper opened a net of 18 new stores, three of which were in our new smaller Checkers Foods neighbourhood format bringing the total in this new smaller format to 12 stores
– Checkers’ successful FreshX conversion programme continued with the upgrade of 29 stores ending the period with 144 stores trading in this format (approximately 40% of the Checkers store footprint)

In terms of smaller, adjacent stand-alone format stores, 54 were opened during the six months:
– 42 Petshop Science premium pet stores to total 128.
– Eight Uniq clothing by Checkers stores to total 30.
– Four Checkers Outdoor stores to total 26.

Shoprite and Usave

Shoprite and Usave, including Shoprite LiquorShop, increased sales by R3.9 billion or 7.1% to R59.2 billion, contributing 55% to the group’s core Supermarkets RSA segment’s sales.

Excluding Shoprite LiquorShop, the two banners increased sales by R3.3 billion, to R52.8 billion, increasing sales by 6.7%.

Shoprite increased sales by 6.7%. Net store openings of 30 stores over the 12-month period resulted in Shoprite ending the period with 660 stores.

Over the six-month interim period Shoprite opened a net of 21 supermarkets.

Usave, our limited assortment no frills discount supermarket, increased sales by 6.8%. Net store openings of 28 stores over the 12-month period resulted in Usave ending the period with 480 stores.

Over the six months under review Usave opened a net of 18 supermarkets

The group’s other operating segments include OK Franchise, Transpharm, Medirite in-store pharmacies, Medirite Plus standalone drug stores, Red Star Wholesale Catering Services, Computicket and the reclassified Angola and Mozambique furniture operations.

Sales generated by this segment increased by 6.2% for the period and represent 7.7% of group sales.

Sales to the retailer’s OK Franchise business increased by 8.8% and the franchise division ended the period with 623 stores.

Shoprite Group CEO Shoprite Group CEO, Pieter Engelbrecht, said: “The growth in sales achieved over this important period is the result of detailed data-led planning and execution, evidenced by our three core South African trading banners and their adjacent new formats collectively adding R10.2 billion in sales to our base for the six months.

“In the context of selling price inflation of 1.9%, this quantum of additional spend, equating to 10.4% increase in sales was underpinned by strong volume growth as a result of across-the-board gains in the number of customers; customer visits and average basket spend.”

The chief executive said that while Africa’s largest retailer welcomes tailwinds from improved consumer and business confidence, “we are not relying on cyclical factors to power our growth”.

“We expect by far the majority of our growth short to medium term will continue to be achieved by our three distinct South African corporate owned and managed supermarket businesses as they focus on their respective customer segments and in doing so increase their share of wallet.”

Whilst small relative to the group, Engelbrecht said the retailer will continue to expand its new adjacent formats – clothing, baby, outdoor and pet.

Notably Petshop Science is now at 129 stores (March 2025) with sales for the interim period increasing by 56.9%.

“Whilst presently small in the group context, our expansion into these categories is meaningful in the universe of everyday purchases for our customers and important in terms of the role they play in our ecosystem which defines our roadmap for future growth.”

Shoprite delivers strong sales growth, expands retail reach

Shoprite Holdings on Tuesday reported a strong operational performance for the six months ended 29 December 2024, noting an increase in sales and continued growth across its diverse portfolio.

For the interim period, the group recorded a 9.6% growth in sales of merchandise from continuing operations, which totalled approximately R128.6 billion. This growth was compared to R117.4 billion in the same period in 2023. After adjusting for hyperinflation in Ghana, the group’s sales from continuing operations increased by 9.5%.

Sales Growth by Segment
The Group’s growth was driven by a strong performance in its core operations, with the following segment breakdown:

Supermarkets RSA: Contributing 83.7% of group sales, Supermarkets RSA achieved a 10.4% increase in sales, despite internal selling price inflation averaging 1.9%. Notably, online sales from Checkers Sixty60 grew by 47.1%. The Supermarkets RSA segment also opened 248 new stores, bringing the total number of stores to 2,485.

Supermarkets Non-RSA: This segment achieved a sales growth of 4.1% (excluding hyperinflation), contributing 8.6% to group sales. In constant currency, the segment saw an impressive 17.9% increase in sales. The store base grew by a net 10 stores to a total of 269 across nine countries.

The group’s diverse operations, including OK Franchise, Medirite Pharmacies, and Computicket, saw sales growth of 6.2%. The OK Franchise store base increased by 18 stores to 623, while Medirite Pharmacies opened six standalone stores, bringing the total to 17.

Shoprite continued to make strategic moves to strengthen its market position:

The group acquired the remaining 50% stake in Pingo Delivery, further integrating its last-mile logistics and enhancing its e-commerce capabilities. This acquisition is expected to drive more efficient operations and increase delivery-related sales.

And in line with its focus on core operations, Shoprite entered into an agreement to sell its furniture business, including OK Furniture and House and Home, to Pepkor Holdings. This deal is pending regulatory approval but is expected to be finalized soon. The furniture business has been classified as discontinued operations.

Africa’s largest retailer continues to expand its footprint with the opening of new stores across multiple segments. A total of 248 new stores were opened over the past 12 months, including new format stores in adjacent categories such as Petshop Science and Checkers Outdoor.

During the interim period, Shoprite repurchased shares worth R997 million, at an average share price of R289.29. The group’s weighted average shares adjusted for dilution for the period will measure 544.5 million.

The group said it remains optimistic about its outlook for the remainder of the year, fuelled by its strong operational foundation, strategic acquisitions, and the expanding footprint of its store network.

Shoprite Holdings will release its interim results for the 2025 financial year on Tuesday, 4 March 2025.