Shoprite is booming

Shoprite increased sales by almost 14% as its core South African supermarkets segment showed a strong performance in the second half of 2023.

Shoprite – which owns brands such as Checkers, House & Home, OK, Uniq and Computicket – released its results for the 26 weeks ended 31 December 2023 today.

South Africa’s largest retailer delivered strong financial results, increasing sales by 13.9% to R121.1 billion. 

This was a well-rounded result, underpinned by the company’s core Supermarkets RSA segment, to which all supermarket brands contributed significantly. This segment saw a 14.6% increase in sales to R97.5 billion. 

Despite reporting against an exceptionally high base of sales growth of 17.5% for the same period last year, the 14.6% increase is still significantly higher than the rest-of-market growth in South Africa for the same period of 7.6%. 

Checkers and Checkers Hyper increased sales by 13.7%, while Checkers Sixty60 increased sales by a further 63.1% over the six months.

The retailer’s 23.6% reported gross margin is also marginally higher year-on-year due to supply chain efficiencies, which allowed for increased volumes through its distribution centres, as well as the respite in fuel prices over the six-month period.

Trading profit increased by 10.7%, resulting in a trading margin of 5.5%, just below H1 2023’s 5.7%.

Shoprite said its trading profit continues to be notably impacted by the R500 million diesel expense to power generators in its South African operations due to load-shedding.

The retailer’s EBITDA increased by 10.3% and measured R10.2 billion. Shoprite generated R12.4 billion in cash in the period.

Shoprite opened 215 stores, expanding its continuing operations footprint to 3,543 stores. 

Total operations capital expenditure to continuing operations’ sales for the period was 3.1%.

Shoprite declared an interim dividend of 267 cents per share, representing a year-on-year dividend per share growth of 7.7%.