Spar liquor outlet continues strong growth

TOPS, the liquor store of the Spar Group, was the star performer during the group’s results for the year to end September, as it continued with its double-digit growth trajectory.

The liquor division increased its retail turnover by 12.4% to R10 billion and wholesale turnover by 11.2% to R5.8bn.

The group said this was achieved despite ongoing delays in obtaining liquor licences. The group opened 51 new Tops stores and closed the year with 733 stores in its portfolio.

Overall, the group also man- aged to report an increase in its different businesses portfolio.

Group turnover increased by 5.3% to R95.5bn, up from 90.7bn while profit before tax achieved a marginal growth of 1% to R2.46bn as compared with last year’s R2.43bn. Headline earnings per share (Heps) were down by 6.6% to 952.5 cents a share, down from 1 020c as compared with last year.

The group said tough overall trading conditions in southern Africa led to a 4.5% growth in turnover to R64.5bn, as compared with R61.7bn.

Chief executive Graham O’Connor said the group’s financial results were modest, with turnover increasing by 5.3% and profit before tax by only 1%.

“These results reflect the weak state of consumer buying power and confidence, which has been exacerbated by retrenchments, political uncertainty and climatic challenges in South Africa,” O’Connor said.

The group served a retail store network of 3 768 at yearend. Capital expenditure increased to R1.09bn, up from R788.7 million. This comprised R516m in southern Africa, including the expansion of the Western Cape and North Rand perishables facilities, as well as the acquisition of the West Rand property for future distribution centre development.

In Ireland and Switzerland, capital expenditure amounted to R354.1m and R220.8m respectively, which was utilised for retail store refurbishments and technology upgrades.

Its other business, Build It delivered a 4.3% increase in retail sales to R12.2bn, while same-store growth amounted to 1.1%, reflecting the tough trading environment and low inflation that is impacting the whole industry.

The board declared a gross final cash dividend of 435c a share.