(Reuters) – South Africa’s largest grocery retailer Shoprite Holdings SHPJ.J on Tuesday reported a 20.3% rise in annual earnings and said it hopes to conclude the sale of assets in Madagascar and Uganda during the 2022 financial year.
Shoprite, with more than 2,800 stores in 13 African countries, said annual headline earnings per share (HEPS) from continuing operations for the 53 weeks ended July 4 rose to 956.3 cents from a restated 794.7 cents in 2020.
HEPS is the main profit measure in South Africa.
Sale of merchandise from continuing operations rose by 8.1% to 168 billion rand ($11.77 billion) driven by stronger grocery sales in its South Africa business under the Shoprite, budget Usave and upmarket Checkers chains as the average basket spend increased by 13.6% despite lower customer visits.
Fewer liquor store closures as COVID-19 restrictions on alcohol sales were lifted also contributed to the overall sales performance, with continued bumper furniture sales driven by a home improvement trend.
Supermarkets in operations elsewhere in Africa continued to operate in regions challenged by macroeconomic and constraints on consumer affordability, which have been exacerbated by the impact of COVID-19 restrictions and regulations.
Notwithstanding these factors, constant currency sales from continuing operations increased by 6.8%. However in rand terms sales declined by 7.5% due to continued currency devaluation as well as the sales and closures of operations in Nigeria, Kenya, Madagascar and Uganda.
Last month Shoprite classified its operations in Uganda and Madagascar as discontinued in line with a review of its Africa portfolio which has been marred by currency volatility and lower spending.
It has five stores in Uganda and 10 in Madagascar.
