South African retailer Pick n Pay reports higher annual earnings

Workers repair a logo of South African retailer Pick n Pay in Johannesburg, South Africa, April 19,2018. REUTERS/Siphiwe Sibeko

JOHANNESBURG, May 17 (Reuters) – South African grocery retailer Pick n Pay (PIKJ.J) reported a 14.5% rise in annual earnings on Tuesday, despite losing about 2.7 billion rand ($168 million) in estimated sales from last year’s civil unrest in the country and liquor sale restrictions.

Headline earnings per share, the main profit measure in South Africa, came in at 262.59 cents for the year ended Feb. 27, compared with 229.31 cents in the previous comparable period.

Group turnover increased by 5.2% to 97.9 billion rand, as cash-strapped shoppers sought value offered by Pick n Pay value and Boxer supermarkets.

Its clothing business also contributed to growth with sales rising by 21%, gaining market share for a fourth consecutive year, while the relaunch of its on-demand grocery delivery service delivered growth of more than 300% since August 2021.

This came despite losing an estimated 1.8 billion in sales from the civil unrest and 900 million rand from the trading restrictions on liquor, mainly in the first half of the year.

About 212 Pick n Pay and Boxer stores and two Pick n Pay distribution centres were damaged and looted during the July violence triggered by the arrest of former President Jacob Zuma, and a further 551 stores were closed on a precautionary basis.

The group recovered 958.7 million rand of material damage losses related to the unrest from state-owned insurer SASRIA during the financial year and received 145.2 million rand of interim business interruption insurance payments in March 2022.

Pick n Pay Chief Executive Officer Pieter Boone hailed the company’s performance in a highly disrupted year and the extraordinary recovery made after the civil unrest.

“Our sales in the fourth quarter of the last financial year, and first quarter of this financial year, demonstrate our potential,” Boone said.

($1 = 16.0659 rand)

Reporting by Nqobile Dludla; Editing by Subhranshu Sahu

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