Spar’s sales up 5.8% to R45.5 billion as the end of liquor restrictions give it extra cheer
|Published
Spar’s share price surged 5.1 percent in intra-day trade yesterday after the retailer saw robust trading for the 18 weeks to January 29, 2022, boosted by the lifting of liquor bans related to the Covid-19 pandemic. Photographer Ayanda Ndamane African News Agency (ANA)
SPAR’S share price surged 5.1 percent in intra-day trade yesterday after the retailer saw robust trading for the 18 weeks to January 29, 2022, boosted by the lifting of liquor bans related to the Covid-19 pandemic.
The shares later closed 3.7 percent higher at R176.80.
The group increased sales by 5.8 percent to R45.5bn for the prior comparative period.
Wholesale sales grew by 8.2 percent after the curbing of alcohol sales was relaxed. It said in a trading statement yesterday that nationwide Tops liquor stores’ sales had risen by 56 percent.
After the lifting of the Covid-19 restrictions on liquor trading, Tops at Spar liquor business had subsequently seen incredible levels of growth in liquor sales, with an increase of 55.8 percent reported for the period.
“No trading days were lost during the period, against the 58 days lost in the prior comparative period. Liquor trading for the period represents the growth of 27.9 percent against the 2020 period,” Spar said.
Alcohol sales returned to normal hours at the end of September, 2021, and the government lifted restrictions imposed on establishments serving alcohol on December 30.
Core Spar grocery wholesale business increased sales by 3.7 percent during a period where grocery retail showed signs of returning to pre-Covid-19 “normality”, and aggressive competitor behaviour continued against the backdrop of a weakened consumer.
Spar’s core business trading was also impacted by the closure of stores due to the civil unrest in July, 2021, in Gauteng and KwaZulu-Natal. “Some stores reopened at varying times during the period.
At the end of the period, 28 Spar format stores remained closed.
“It is expected that 20 stores should open over the next year, but the remaining eight stores will not reopen," Spar said.
“Considering the Covid-19 pandemic and the extraordinary effect this has had on the group over the past two years, the group continues to benefit from its diversity and has demonstrated its robustness and resilience during these disruptive times,” Spar said.
The JSE-listed group owns Spar stores in South Africa and has several European locations which include Switzerland and Poland.
BWG Foods, which is in Ireland and South West England, performed well. “In EUR terms, the Irish business increased turnover by an impressive 6.9 percent for the period, and 1.9 percent in ZAR terms, demonstrating the impact of the strengthening of the rand,” the group said
Meanwhile, Spar competitor Shoprite, on Monday flagged a profit increase of at least a fifth for the 2022 half-year.
The group, which comprises Shoprite and Usave, seems to continue to pick up market share, as it reported that its headline earnings per share were expected to increase between 20.5 percent and 26.5 percent to between 501.8c and 526.8c in the six months to end-January, the Shoprite group said.
dieketseng.maleke@inl.co.za
BUSINESS REPORT ONLINE