Spar’s headline earnings per share increase

THE increasingly international Spar Group on Wednesday reported an increase of 22.1 percent in headline earnings per share for the year to the end of September on turnover that was also up by nearly a quarter.

The South African-based grocery chain said turnover came in at R90.7 billion, an increase of 23.8 percent on R73.3 billion the year before.

A statement from the company added that 32 percent of total turnover had been generated in foreign currency during the period under review, compared with 23.1 percent the year before.

Net asset value per share had increased by 63.3 percent, from 1 922.6 cents to 3 140.1 cents.

“Spar Southern Africa’s organic growth focus continued to pay off with positive indications of market share gains across all store formats,” the statement added.

BWG Group (Spar Ireland) had delivered “excellent growth”, underpinned by a positive contribution from all brands and store formats. The statement added that the Londis business had been fully integrated ahead of plan and was beating expectations.

The acquisition of a majority stake in Spar Switzerland, effective on April 1, added a third geographic region to the group’s portfolio.

“Although the performance for this first period of consolidation was disappointing, the group is confident of an improvement through well-defined management interventions to enhance retail performance and grow the business.”

Spar said the core Southern African business had recorded turnover growth of 9.5 percent, which had been “underpinned by aggressive promotional and marketing activity in a highly competitive market”.

The Irish operations delivered 36.8 percent turnover growth, bolstered by the acquisition of Londis.

Turnover of Spar Switzerland, consolidated for the second six months, contributed R5.9 billion.

Profit after tax improved by 27.7 percent to R1.8 billion, from R1.4 billion a year before, with Spar noting the benefit of lower effective tax rates in Ireland and Switzerland.

Headline earnings per share grew by 22.1 percent, from 835.5 cents to 1 020 cents. The weighted average number of shares had increased from 173.1 million to 179.7 million shares during the period under review following an issue to fund the Irish and Swiss acquisitions and to settle the empowerment scheme that vested in August.

The board approved a final dividend of 410 cents, resulting in a total annual dividend growth of 5.2 percent, which was largely impacted by the increased number of shares and accounting adjustments in the prior year.

The group said it would maintain its focus on the growth of its Southern African business “regardless of the uncertainty of both the economic and political landscape”.

It added the Irish economy remained robust and the BWG Group was wellpositioned to extend its strong performance. The company said it was also confident about the future of the Swiss operations.

“Management and the board believe we will continue to prosper in our chosen markets and deliver value to our shareholders,” the statement added.— African News Agency.