Massmart wants to expand Game stores
RETAILER Massmart intended to increase the number of Game stores offering fresh produce, food and liquor in the next few years, chief executive Guy Hayward said yesterday.
Food and liquor sales comprised 21.8 percent of Game. The listed retailer said it would prioritise expansion into food retail and fresh categories through new stores.
Massmart is currently waging a battle against fellow retailers Pick n Pay, Spar and Woolworths. The group has alleged, at the Competition Tribunal, that the major retailers were frustrating Game’s national expansion ambitions as they had exclusivity clauses at major malls.
Reduced dividend
In the six months to June, Massmart’s total sales were up 8.7 percent to R42.3 billion, while operating profit before interest was R819.1 million, up 19.5 percent. Headline earnings increased by 19 percent to R320.6m. Massmart reduced its dividend per share by 49.2 percent to 74.1 cents.
In the six months, Massmart opened nine stores. On the other hand, the group closed seven stores. Hayward said some of the towns in which the group had stores had been affected by mine closures, hence the decision not to renew leases.
Massmart, owner of brands such as Game, Makro, DionWired and Builders Warehouse, said it would embark on a measured sub-Saharan Afri- can expansion through Builders Warehouse, Game and Masscash. Hayward said the company’s approach to growth into the rest of the continent had always been measured as some African markets were volatile and risky.
“Many countries in subSaharan Africa continue to struggle with the dual challenges of a strong US dollar and weaker commodity prices. A few countries saw severe currency weakness, which was compounded by shortages of foreign currency needed to settle imports into those countries,” Massmart said. It said it expected to open a new store in Nigeria later this year.
Massmart shares declined by 0.66 percent to close at R133.11 on the JSE yesterday.