ShopeRite Holdings’ latest Earnings Report is Impressive

South Africa’s largest food retailer, ShopRite Holdings Limited, has released its half-year 2021 earnings report which showed impressive growth.

A copy of the financial statement which was obtained by Business Elites Africa, revealed that even though the number of customers declined by 3.8%, shoppers bought more items per visit. And this inevitably helped to ramp up sales.

Financial Indicators

• During the half-year period under review, ShopRite’s revenue increased by 8.1% to R171.1 billion (about $11.9 billion).
• Operating profit also increased by 19% to R9.7 billion ($681 million).
• In the same vein, profit after tax jumped by 43.9% to R4.9 billion ($349.1 million)

The company’s Chief Executive Officer, Pieter Engelbrecht, offered some explanations as to the factors that enabled the positive performance. He was quoted to have said:

“2021 was a challenging year for the countries in which we operate but as a result of the Group’s commitment and execution we increased sale of merchandise by 8.1%. In rand terms, this growth equates to an additional R12.6 billion in sales on last year’s restated base to total a record R168.0 billion in sales for the year. Adjusting for the extra week included in this year’s reporting period, on a 52-on-52-week basis our rand sale of merchandise growth on last year’s base measured R9.1 billion.

“Our core Supermarkets RSA segment reported strong sales growth of 9.3% (52 weeks: 6.9%) from a high base and after accounting for our LiquorShop business being closed for 144 days during the year. The segment’s R133.9 billion in sales was a combined effort from our Shoprite and Usave businesses which increased sales by 8.8% and our Checkers and Checkers Hyper businesses, which increased sales by 10.9%. This growth is a testament to our loyal customers and the relentless commitment of our team who ensured we delivered unsurpassed value, either in-store or digitally, throughout the year.”

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Some Background Insight

Recall that ShopRite Holdings Limited recently divested from its other African operations in places like Nigeria, Kenya, Uganda and Madagascar. The move was part of strategic restructuring that was expected to see the company focus more on its South African market. Following this development, the company opened more stores in across South African cities. This has proven to be a profitable move.