Shoprite results improve
The Shoprite Group has reported strong growth in the first quarter of its 2013 financial year despite the continuation of depressed market conditions, the mega-retailer said earlier this week at the release of its quarterly results. Total turnover increased by15,6% compared to 10,8% in the corresponding three months.
The high turnover growth was boosted by a strong performance by its non-RSA division which was also positively influenced by the weakening of the rand, as well as further market share gains in South Africa.
The Group’s core business, Supermarkets RSA, grew turnover by 12,2% with internal food inflation averaging 3,6% compared to 4,0% for the corresponding three months in 2011. Internal food inflation was below the official food inflation of 5,3% and real sales growth of 8,6% was achieved.
Shoprite CEO Whitey Basson said the performance of the Group’s non-RSA operations was boosted by the opening of 20 new food outlets since October 2011. Of these, eight were Shoprite supermarkets and 12 were Usave stores. In constant currency terms, turnover growth for the African operation was 26,4% compared to 13,9% in the corresponding three months. The increase in rand terms was 34,3% compared to 12,7% in 2011.
Although the highly competitive market conditions in which the furniture division traded remained virtually unchanged, turnover grew 11,9% despite the continuing deflationary environment. Other divisions in the Group which in addition to OK Franchise include Medirite and Computicket, grew turnover by 29%.
Basson said with consumers under increasing pressure, it was difficult to predict spending patterns going into the festive season.