South Africa’s Shoprite Holdings is undoubtedly Africa’s biggest retailer by sales. The retailer, which began as a chain of eight stores in South Africa in 1979 has 189 stores outside South Africa and is on the move for greater expansion.
The retailer, which also operates the Checkers grocery chain and OK Furniture, reported a 10.8 per cent rise in full-year earnings on 18th August , buoyed by sales growth of 13.5 per cent in stores outside its home market. Last year it opened 20 stores outside SA.
Shoprite is depending on fast growth in markets such as Nigeria and Angola where it is changing the shopping habits of Africa’s middle class.
While there are plans to open new 35 stores across Africa before the end of the year, Nigeria will get 14 new stores in the next 20 months. Shoprite is building a distribution centre in the country so as to move goods faster because imports into Nigeria can be delayed in ports.
The Group’s 189 supermarkets outside South Africa grew turnover by 13.5% in rand terms. According to its CEO, “headline earnings per share increased by 10.8% to 772.9 cents (2014: 3.3% to 697.6 cents) and the board declared a final dividend of 243 cents per ordinary share (2014: 218 cents) to bring the total dividend for the year to 386 cents (2014: 350 cents)”.
Whitey Basson said it was important to note that the growth in turnover did not come at the expense of profitability. “We achieved the 10.7% growth in trading profit through diligent cost control in all areas of the business and enhancing our end-to-end supply chain. As a result, we could maintain our trading margin at almost 5.6% which remains world-class.
“We are very proud that our ongoing growth is a key and consistent employment generator. During the past financial year we created jobs for 9 842 more people, bringing our total staff complement at the end of June 2015 to almost 133 000. About 115 000 of our staff are employed in South Africa and close to 18 000 outside its borders. In the past six years we have created a total of almost 49 000 additional jobs. Staff productivity also continues to increase and in the past year grew by 5.1%.”