Shoprite Profit Gains as Food Shoppers Spend More Per Visit
(Bloomberg) -- Shoprite Holdings Ltd. said customers numbers dropped but shoppers bought more per visit as Africa’s largest supermarket chain continues to grapple with the coronavirus pandemic.
Operating profit rose 19% to 9.7 billion rand ($681 million) in the year through July 4, the Cape Town-based company said in a statement on Tuesday. Visits declined 3.8%, while the average basket spend climbed 13.6%.
Shoprite, which has put its main focus on the South African market while scaling back elsewhere on the continent, posted strong second-half sales growth as it opens more stores. The group exited Nigeria, Kenya, Uganda and Madagascar in recent months, either selling or discontinuing operations in those countries.
The shares gained 2.9% a of 9:16 a.m. in Johannesburg. The stock has gained 31% this year, compared with an 11% gain on the FTSE/JSE Top40 Index.
The retailer is adding to its floor space through the purchase of the food units of Walmart Inc.’s South African retailer Massmart Holdings Ltd. The grocer opened 87 local supermarkets in the year and plans to add a further 131 outlets in 2022.
The owner of chains including Checkers and U-Save increased the final dividend to 3.53 rand, up from 2.27 rand a year ago.
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