Stores re­fur­bish­ment dis­rupts Pick n Pay’s rev­enue growth

Chronicle (Zimbabwe) - - Business -

PICK n Pay blamed its rev­enue growth of seven per­cent to R79 bil­lion on “dis­rup­tion to trade” due to re­fur­bish­ing 62 stores and clos­ing 12 un­der­per­form­ers dur­ing the 52 weeks to Fe­bru­ary 26.

Af­ter tax profit grew a more im­pres­sive 17 per­cent to R1.2bn, and the gro­cery chain de­clared a fi­nal div­i­dend of 146.4c, tak­ing the to­tal for the year to 176.3c, an 18 per­cent in­crease on the pre­vi­ous year’s 149.4c.

Pick n Pay man­aged to grow profit faster than sales de­spite re­strict­ing its sell­ing price in­fla­tion to 6.1 per­cent for the year, well be­low pub­lished food in­fla­tion of 11 per­cent, CEO Richard Brasher said in the re­sults state­ment re­leased on Wed­nes­day morn­ing.

Fran­chise fee in­come grew 10.5 per­cent to R349.8m, re­flect­ing the 70 new fran­chise stores opened dur­ing its fi­nan­cial year. These in­cluded 32 Pick n Pay Ex­press stores on BP fore­courts. There were now 111 Pick n Pay Ex­press stores, more than dou­ble the num­ber of two years ago, Brasher said.

The group opened 68 new Pick n Pay com­pany-owned stores and 25 new Boxer stores across all for­mats over the year, in­clud­ing 14 Pick n Pay lo­cal con­ve­nience stores. New stores con­trib­uted 3.6 per­cent to turnover growth. The group added 24 cloth­ing stores and 46 liquor stores in its 2017 fi­nan­cial year. “The Pick n Pay cloth­ing busi­ness again de­liv­ered strong dou­ble-digit growth, as cus­tomers sought lon­glast­ing qual­ity at great value. The group’s liquor busi­ness grew 15 per­cent, with solid mar­ket share growth across a num­ber of key lines,” the com­pany said. Pick n Pay opened 12 new su­per­mar­kets out­side SA dur­ing the year, three in Namibia, six in Zam­bia, one in Zim­babwe and two in Botswana. The group plans to open its first stores in Ghana and Nige­ria over the next two years. “The group’s core South African op­er­a­tions de­liv­ered growth in profit be­fore tax and capital items of 20 per­cent, with tough trad­ing con­di­tions in Zam­bia con­strain­ing growth in the rest of Africa di­vi­sion,” the com­pany said. Pick n Pay’s loy­alty pro­gramme grew to seven-mil­lion ac­tive mem­bers. Brasher said this trans­lated to 20 swipes at tills ev­ery sec­ond. Its Smart Shop­per pro­gramme had been al­tered to of­fer weekly per­son­alised dis­counts tai­lored specif­i­cally to each cus­tomer on the ba­sis of their ac­tual shop­ping habits, the com­pany said. — Busi­nessDay.

Richard Brasher

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