South Africa’s biggest retailer plunges as sales growth slows

Shoprite’s share price plunged by as much as 5% following the release of a disappointing trading update, despite an 8% increase in sales.

While the company’s shares have clawed back some of these losses over the course of the day, its share price is still down around 3% by the time of publication.

Shoprite is South Africa’s largest retailer, with a market cap of R165.76 billion on the JSE and a footprint of over 3,400 stores.

The company holds some of South Africa’s most well-known brands in its portfolio, including Checkers, Sixty60, Uniq and Usave.

On Monday, 10 November, Shoprite released a voluntary update for the first quarter of its 2026 financial year.

This update revealed an 8% increase in group sales. The company opened 81 stores in the quarter, the majority of which were opened in its core South African supermarkets (Supermarkets RSA) segment.

This division increased sales by 7.9%, compared to the same period last year’s 11.4%. The company said this growth reflects continued outperformance compared to the rest-of-market growth by a factor of 1.7 times.

The Supermarkets RSA segment recorded selling price inflation of 1.4%, down from 2.6% in the first quarter of its 2025 financial year. 

The company noted that this is a notable divergence from Statistics South Africa’s reported food and non-alcoholic beverages inflation of 5.1% over the quarter. 

“Notably, for the month of September 2025, selling price inflation in our price fighting banners, Shoprite and Usave, was 0% and negative 0.4%, respectively,” Shoprite said. 

“Within this sustained low inflation context, the business remains vigilant in terms of cost growth management.”

The Supermarkets RSA segment opened a net 72 stores during the first quarter, with new store openings made up of 38 supermarkets, 22 LiquorShops and 19 adjacent formats.

The group’s Supermarkets Non-RSA segment saw strong sales growth of 12.9%, or 10.9% in constant currency terms.

This segment opened three new stores during the first quarter – one Shoprite and two LiquorShop.

The group’s other operating segments reported a 4.8% increase in sales, which is down significantly from the 10.2% growth recorded in the comparative period.

This growth was driven by its Medirite business, which increased sales by 12.3% for the period, ending the quarter with 118 in-store dispensaries and 21 Medirite Plus stand-alone drug stores. 

The group’s pharmaceutical distributor, Transpharm, increased sales by 2.7%, impacted by relocating to its new, highly automated Johannesburg distribution centre.

Shoprite said it is set to get a boost in the second half of its 2026 financial year, when it will receive the proceeds from the sale of its furniture business in October 2025.

The company plans to issue its 2026 interim period sales update by the end of February 2026 and will report its 2026 interim results during March 2026.

Following the release of this update, Shoprite’s shares were down as much as 5%, as some shareholders may have hoped for higher sales growth given the company’s lofty valuation and previous performance.

Notably, while the group’s sales growth outperformed the market, it is lower compared to the first quarter of its 2025 financial year, as seen in the table below.