Trade Intelligence Logo

With all the “I am just a simple man from Brackenfell” and the bluff jousting with analysts come results time, one forgets that at the heart of the Shoprite operation is a big, shiny, cold steel calculator. And then, occasionally, one is reminded of it – at results time, obviously, then again this week when the Big Red One opened its bonds for trading. In March, you will recall, they raised an extra R8billion through the offer of shares and bonds in order to raise extra cash for growth (and presumably to hedge against the onset of Wakro), which you and I could purchase in ten grand bundles at an annual rate of interest of 6.5%. Then, at any stage, we could convert them to shares – unless after three years Shoprite decided that the shares were better traded on the open market, in which case, deal's off. Fair enough.

Comment: We're sure we have a couple of those Defence Force Bonus Bonds stashed under the mattress from 1983. Might be worth a couple of bob, eh?

OK, we're confused. Last week, we reported with our characteristic lack of breathlessness that Woolies had won some species of reputation award. This week, we are happily but equally breathfully able to report that Pick n Pay have gone and done something similar. The Big Blue was number one in the retailer’s section of the Mail and Guardian's Top Company reputation Index and number 4 overall, as 26% of punters questioned spontaneously recalled it as a business with a great reputation, and a staggering  98% of them recognised the brand without having to be prompted. The Index incorporates all aspects of reputation – including brand, trust as an employer and corporate citizen, as well as trust as a source of products and services. 80% of the punterati questioned said they would specifically buy from a company that has a good reputation, whereas 51% indicated that they would avoid a company with a bad reputation.

Comment: So there you have it. Until next week.

Production was down at Illovo, with less than ideal growing conditions in the pertinent region (coughclimatechangecough! What? Oh, nothing), but did this deter the group from turning in a handsome set of numbers for the year ended March? It did not. Turnover up R1.1billion to R9.2billion, on the back of sales volumes which declined by 5% because there was simply less of the sweet, crunchy stuff to sell. No worries though: operating margin increased from 12.7% to 14.7%, with a 31% increase in operating profit from R1.03billion to R1.35billion. “Whence this splendour, this magnificence?” you enquire, and we'll tell you: sugar production to the tune of 59%, cane growing 30%, and downstream (whatever the heck that is) and power generation 11%. Malawi coughed up 39% of this, Zambia 33%, Tanzania 11%, a little place called South Africa 7%, Swaziland 6% and Mozambique 4%.

Comment: Not bad, eh? And with 2012/13 promising the bounty of mother nature herself, next year should be even more pleasing.

We hate pop-up shops. We don't know why we do, we just do. Maybe because the people who love them wear True Religion Jeans and little red oblong spectacles and also love TED. Or just the name – pop-up shop: eeeurgh! Or maybe it's because real retail, the kind that involves making a profit year after grinding year, is so much more difficult than building a little loss-making shrine to your client's brandy-wand for a couple of weeks then going on to the next big thing, and is thus more deserving of the ancient and respectable title “shop”. But having said that, we think the Jacobs Coffee Board Game pop-up shop at 69 11th street Parkhurst is a marvellous idea, beautifully executed. The idea is that you pop in and rediscover the simple joys of connecting with people over a free cup of coffee and a board game, kind of like we did at our friend Russ's house in third year, then associate that warm and fuzzy sensation with the brand in question.

Comment: So we take it back. Kind of.

Good work, Big Guy: revenue up 11% to $31.3billion, on the back of an increase on volume of 4%, with EBITA up 12%,  adjusted profit before tax up up 13% to $5billion and free cash flow, which in our house is where the pedal hits the metal certainly, up 23% to $3billion. Volumes were up 8% in Latin America and an intoxicating 13% in Africa (except in the dear old RS of A where we have moderated our view of “a night on the tiles” apparently, growing beer volumes a wussy 2%). It's in the area of operations, however, where the big wins seem to have been: the net operating benefits from the global procurement programme exceeded SAB's expectations, with a tally of $159million for the year, while the rollout of their new global IS solution is proceeding at a cracking pace, with Ecuador recently done and Poland, one of the Big Feller's biggest markets, up next.

Comment: And Australia apparently coming along pretty well too all things considered.

This is what passes for good news right now: SA's economy grew at an unexpectedly bullish 2.7% in the first quarter this year, confounding the more dismal economists who had pegged it as low as 1.9%. Breaking it down, manufacturing grew 7%, financial services and real estate 4% and retail, which includes unlikely bedfellows catering, accommodation and the motor trade just 3%. And here we take an opportunity to drop a name and quote an old acquaintance: "Growth risk remains on the downside given the global outlook, implying the Reserve Bank’s monetary policy committee will be happy to stay on the sidelines for the time being," says Bank of America/Merrill Lynch's dashing young Matthew Sharratt. Reading between the lines, we think he's implying that the repo rate will remain unchanged for the present.

Comment: Dire, but stable. Which might be a good national motto come to think of it.

You will be saddened to hear that the number of British retailers going out of business increased 38% to 670 in the first quarter of 2012, up from 486 in the fourth quarter 2011, as they battle to meet overheads – particularly rentals, which err over there on the side of exhorbitant, and meet with stony silence from the banks who are unwilling to extend credit in what has unfortunately become a double-dip recession.

In a move that nobody could have seen coming, Kraft has revealed that reluctant subsidiary Cadbury is getting right back into the popcorn market, a mere four years after its exited it with the sale of Butterkist. The new popcorn will be toffee-flavoured with the payoff line ‘Choc full of … popcorn’, and will be aimed at the lucrative and growing, or indeed overhyped,  “big night in” trend. Personally, we prefer watching Game of Thrones with a big bag full of raw meat beside us on the sofa, but that's just us.