Shoprite Holdings has announced its reviewed results for the 52 weeks ended 30 June 2024, showcasing a robust increase in sales across its core South African supermarkets segment.
Key Financial Highlights:
Group revenue increased by 12.0% to R246.1 billion.
Group sale of merchandise rose by 12.0% to R240.7 billion.
Supermarkets RSA, the core business, saw a 12.3% increase in merchandise sales, to R195 billion.
Group trading profit grew by 12.4% to R13.4 billion.
Diluted headline earnings per share (DHEPS) increased by 7.4% to 1,245.2 cents.
Adjusted diluted headline earnings per share rose by 10.3% to 1,273.2 cents.
Excluding the impact of hyperinflation, Group sale of merchandise increased by 12.0% to R240.8 billion, and DHEPS increased by 6.0% to 1,238.7 cents.
Full-year dividend per share increased by 7.4% to 712 cents.
The Group opened a net of 292 stores and created 6,490 new jobs, including 73 new OK Franchise stores.
Pieter Engelbrecht, Chief Executive Officer, said: "During a time when customers are incredibly pressured, this is the greatest reward for our efforts which come as a result of best-in-class execution, innovation and an unwavering dedication to serve.
"Growth of this nature, in a highly competitive market and from a high base can only be achieved as a result of across-the-board commitment."
The group generated R23.6 billion in cash from operations and invested R7.8 billion in its Smarter Shoprite strategy, including new stores, store upgrades, digital and e-commerce, IT, sustainability, and supply chain improvements.
Despite these investments, Shoprite increased its dividend by 7.4%, returning R3.9 billion to shareholders.
Supermarkets RSA
The Group’s core business, Supermarkets RSA, making up 81% of Group sales is represented by 2 322 stores across our major trading brands Shoprite, Usave, Checkers, Checkers Hyper, LiquorShop and other.
As a segment, Supermarkets RSA achieved 12.3% sales growth (first half sales increasing 14.6%, second half sales increasing 10.1%).
Internal selling price inflation averaged 5.8% for the period (2023: 10.1%) with the first half period average inflation of 7.7% declining to an average of 4.2% for our second half period.
Customer visits for the period increased by 3.7% and average basket spend increased by 8.4%.
Private label brands participate in a number of categories across all of our supermarket chains, measuring 21.3% excluding liquor for the period (2023: 20.9%).
The Checkers mid-to-upper segment supermarket chain, including its 38 larger format Checkers Hypers, increased its sale of merchandise by 12.3% (2023: 18.0%), contributing 39.9% to the group’s core Supermarkets RSA segment’s sales.
Checkers Sixty60, the group’s digital on-demand grocery delivery service increased sales by 58.1% (2023: 81.5%), expanding the store base from which it services Checkers customers to 539 stores (2023: 466 stores).
Checkers, inclusive of Checkers Hyper, increased its store base over 12 months by a net of 25 stores to end the period with 321 supermarkets.
In terms of store openings and upgrade activity over the 12-month period under review:
The smaller Checkers Foods neighbourhood format increased by two stores bringing the total in this format to nine stores;
Checkers’ successful FreshX conversion programme continued, ending the period with 115 stores trading in this format (approximately one third of the Checkers store footprint);
In terms of smaller, adjacent stand-alone format stores, 65 were opened during the 12 months:
34 Petshop Science premium pet stores to total 86;
Three Little Me baby stores to total 12;
14 UNIQ clothing by Checkers stores to total 22; and
14 Checkers Outdoor stores to total 22.
The Shoprite and Usave supermarket businesses increased sales by 10.7% (2023: 15.6%) for the period (7.9% excluding the contribution from the 52 stores acquired from Massmart), contributing 51.1% to Supermarkets RSA sales:
Shoprite increased sales by 10.3% (2023: 15.7%). Net store openings of 20 stores over the 12-month period resulted in Shoprite ending the period with 638 stores.
Usave increased sales by 13.2% (2023: 14.6%). Net store openings of 22 stores over the 12-month period resulted in Usave ending the period with 463 stores.
The Shoprite and Checkers LiquorShop business increased sales by 20.0% (2023: 30.8%).
"In addition to our investment in our business, our dividends to shareholders and distributions to our staff, we returned R16.9 billion to our 31 million Xtra Savings customers this year. Looking ahead, our focus on price and value will remain our top priority for our customers whose loyalty we appreciate and value above all else," said Engelbrecht.
Shares in Shoprite are up 19.5% over the past year, with a market cap exceeding R185 billion.
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