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TM Supermarkets lifts ‘Rest of Africa’

19 Oct, 2018 - 00:10 0 Views
TM Supermarkets  lifts ‘Rest of Africa’ Pick n Pay

eBusiness Weekly

Tawanda Musarurwa
Tm Supermarket boosted profits in the 26-weeks to August 26, 2018, contributing significantly to South African retailing giant’s Pick n Pay Stores’ financial performance during the period.

Group management attributed TM Supermarkets’ strong sales and profit growth to competitive promotions and improved on-shelf availability.

The Zimbabwean operation was the best performer within the Rest of southern Africa division (the group has an established presence in Botswana, Lesotho, Namibia, Swaziland, Zambia and Zimbabwe).

“Profit before tax was up 7,3 percent to R136,1 million, driven by an outstanding performance from the group’s associate in Zimbabwe, TM Supermarkets (TM),” said Pick n Pay chief executive officer Richard Brasher in an analysis of the results for the 26-weeks period.

“TM Supermarkets delivered turnover growth of 30,4 percent in local currency terms, anchored by improved stock availability and an effective promotional calendar.”

Pick n Pay’s share of TM Supermarkets’ after-tax earnings grew 94,5 percent on a year-on-year basis.

Pick n Pay has a 49 percent investment in Zimbabwe’s TM Supermarkets (several of which have been re-branded).

Brasher said the group’s strategy “to take a measured approach to growing operations outside South Africa” was yielding positive results.

The group operates in six countries outside South Africa on an owned and franchise basis, with a 49 percent investment in TM Supermarkets in Zimbabwe.

Pick n Pay’s African footprint consists of 144 stores, and Zimbabwe accounts for the largest share with 57 stores.

Meanwhile, the group’s profit before tax for the half-year period rose 19,1 percent to R670,2 million ($46,7 million) from R562,8 million same period last year on a normalised basis.

This was largely on the back of reduced prices.

Pick n Pay reduced prices across 2 500 every day grocery lines.

Said the CEO: “We have reduced prices of key grocery lines, delivered a more compelling fresh meat and produce offer, and given our customers simpler and more personalised promotions.”

Resultantly, like-for-like sales climbed 3,8 percent, more than double the previous half-year’s growth.

Total sales rose to R41,2 billion, up 6,4 percent.

The group’s normalised headline earnings per share was up 17 percent to 100,18 cents.

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