Pick n Pay continues closing stores as Boxer is booming

Excluding Boxer’s strong results, Pick n Pay’s sales declined for the majority of its 2025 financial year, with the retailer closing a net 32 stores.

Pick n Pay released a trading update for the 45 weeks ended 5 January 2025 on Tuesday, 4 February.

The retailer said its sales for this period increased by 3.6% and grew by 3.3% on a like-for-like basis.

However, this growth was primarily driven by the stellar performance of Boxer, Pick n Pay’s discount retail business that was spun off in November last year.

Boxer saw strong sales growth in the 45-week period, with sales up 11.4% and 6.7% on a like-for-like basis.

In a separate announcement, Boxer released its maiden trading update following its separate listing last year.

The discount retailer said its internal food inflation for the period was 6.1% compared to 5.3% in the first half of its 2025 financial year. 

However, it explained that Boxer’s reported internal inflation is based on the year-on-year change in average unit prices for items common to both periods, where the average unit price is calculated as total like-for-like sales divided by total related product volumes. 

This methodology does not normalise for mix change impacts, which are highly influenced by promotional activity. 

Therefore, normalising for mix change impacts, Boxer’s inflation for the period would be 0.0%, compared to 0.5% in the first half of 2025.

Boxer said it believes this provides “a truer reflection of underlying inflation for its customers”. 

The retailer also mentioned that its gross profit margin year-to-date is in line with Boxer’s expectations.

Pick n Pay’s stores, without Boxer, did not fare as well. The retailer’s Pick n Pay segment reported a 0.4% decline in sales and meagre growth of 1.6% on a like-for-like basis.

The retailer noted that this was progress, as the key turnaround indicator for Pick n Pay’s performance is like-for-like sales growth.

Therefore, while 1.6% growth in like-for-like sales is not high, it is an improvement from the 0.4% decline the retailer reported in the second half of its 2024 financial year.

“The group is pleased with Boxer’s continued strong performance and is driving to sustain and build on Pick n Pay Supermarkets’ improved like-for-like sales momentum by further enhancing retail disciplines and working with franchisees to drive franchise sales,” the company said.

The company explained that, for these results, the implementation of its Store Estate Reset plan resulted in total sales lagging like-for-like sales momentum.

It said this was a natural consequence of the planned store closures and conversions. 

Pick n Pay South Africa closed a net 32 supermarkets during the 45-week period – including 24 company-owned stores and 8 franchise stores – and converted 5 company-owned supermarkets to franchises.

However, the retailer’s clothing segment performed well, with clothing sales momentum improving in the latter 19 weeks of the period to 10.3%.

In addition, online sales growth for the period was 42.5%, driven by the continued growth of Pick n Pay asap! and Pick n Pay Groceries on the Mr D app.

Pick n Pay SA’s internal selling price inflation for the period was 2.4%, down from 3.4% in the first half of its 2025 financial year.