Shoprite Proceed with Caution
Those Shoprite interims and everyone – Shoprite themselves included – are surprised that the news is not as good as it used to be in the glory days. Sales up just +0.2% in the six months through December, to R75.8bn, with like-store sales down -2.7% YoY. In the rest of Africa, the Group recorded a trading loss of R61.8m, driven largely by currency issues in Angola, as against a trading profit of R552.7m last year. The worrying performance back home was driven by DC strike action causing out of stocks which cost an estimated billion in sales, the extended SAP conversion of over half the business and the longest period of internal price stagnation in living memory. On the upside, says the trading statement, “since January 2019, an improved sales trend is evident”. But for a wrap up of the numbers, have a look at our summary here.
Comment: In the absence of the immortal wit of Whitey, here’s something from Oom Christo, who showed up at the presentation, lending some gravity to the whole shebang: “Shoprite has been through tough times before. We proceed with caution, but we are not in any form or fashion about to run away.”