South Africa’s consumers are under “extreme pressure,” and their situation may even have worsened since the six-month period to August 31, Pick n Pay’s CEO Sean Summers said Monday.
The group, which has closed a net 60 supermarkets in South Africa as it moves to regain profitability, yesterday released interim financial results that showed its turnaround gathering momentum, with trading profit up 273.5% to R310 million from R83m. This follows a turnover increase of 4.9%, with like-for-like (LfL) sales up by 4.7%.
Summers said in a telephone interview that given the pressure consumers are facing with a lack of disposable income, he was concerned that up to R1 billion a month is being taken offshore through online gambling. There are estimates that up to 20% of government social grants are spent on online gambling, which could have been used for food. He said many other countries, such as Italy, Norway, and Belgium, had taken steps this year to curb online gambling.
Pick n Pay’s share price fell hard by 7.39% on the JSE in the afternoon after it reported that the group break-even is likely to be a multiyear project.
The share price fell to R30.07, although it remained above the R26.48 that it traded at the same time a year before.
The results for the 26 weeks to August 31 showed headline loss per share marrowing by 56.2% to 59.77 cents. This was driven mainly by steady operational improvements and interest savings resulting from a recapitalisation.
Summers said the Store Estate Reset program, a key part of the Pick n Pay turnaround strategy, was now largely complete.
Pricing discipline had kept internal selling-price inflation at 2.1%, well below CPI food inflation of 4.6%, helping all customers. “We are confident our pricing is consistently competitive, which is borne out by leading independent market surveys,” he said.
“While reaching break-even remains a multi-year journey, the investments we are making to rebuild retail excellence will ensure sustainable, long-term profitability. The work we are doing now will manifest itself in the future, and every investment we make is to ensure our long-term success,” said Summers, who was specifically appointed in September 2023 to head the turnaround process.
He said the turnaround was gaining traction and they were on track with strategy. Like-for-like sales growth had accelerated, customer numbers were growing and separately listed 65%-held discount retail group Boxer continued to outperform.
Boxer had reported a 13.9% increase in turnover in the period. PnP Clothing opened its 400th stand-alone store. Online sales recorded solid double-digit growth.
Pick n Pay Supermarkets’ market share had stabilised, notwithstanding the reduction in the size of the supermarket estate, “a clear sign we are on the right path,” said Summers.
Pick n Pay SA company-owned supermarkets achieved 4.8% LfL growth, well ahead of internal selling price inflation of 2.1%.
LfL customer growth accelerated to 7.4% from 3.7% in the 2025 financial year across SA company-owned stores. Clothing turnover increased 12% (7.5% LfL).
Digital transformation remained a key growth engine. On-demand online sales continued to grow steadily, with asap! and PnP groceries on the Mr D app delivering 44% year-on-year growth. The successful migration to the new asap! grocery on-demand app had provided a more seamless shopping experience and enhanced value for customers. Pick n Pay’s online product range now exceeds 35 000 products.
The reduction in headline loss per share was driven by steady operational improvements and the interest savings resulting from the recapitalisation.
The Store Estate Reset programme, a key part of the Pick n Pay turnaround strategy, was largely complete.
“This is an important milestone. Going forward, any further changes to our store estate will simply be a normal part of assessing each store’s performance as leases come up for renewal,” said Summers.
He said their focus remained to “strengthen the customer offer, accelerate like-for-like sales, establish a sustainable future-fit business, and unlock new growth engines to support the turnaround.”
A stronger fresh product offer, more own brand lines, and customer service training for over 28 000 store employees had all enhanced the in-store experience, leading to an increase in customers turning to Pick n Pay, he said.
In addition, the improved franchise operating model combined with closer engagement and collaboration with franchise partners was driving improvements across the supermarket estate.
The group said it would invest R2.2 billion over the full financial year, focused on the expansion of Boxer and PnP Clothing, while capex on Pick n Pay Supermarkets would be prudently allocated to customer-facing initiatives and strategic store revamps.
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