South African supermarket Shoprite’s Q1 sales rise 13.2%

JOHANNESBURG (Reuters) – South Africa’s biggest supermarket group Shoprite said on Monday its first quarter sales rose by 13.2% as it opened 81 new stores and continued to grow market share.

Many African households remain constrained by tight budgets amid a surge in living costs. But Shoprite’s chains that service either low-income groups or middle-high income shoppers has to an extent insulated it from these shocks.

Contributing to group sales for the three months ended September was its largest business Supermarkets South Africa, which grew sales by 13.3%. Internal selling price inflation in the quarter measured 8.3%.

Its rest of Africa supermarkets business, which trades from nine African countries, reported sales growth of 9.7% in rand terms and grew by double digits in constant currency.

Shoprite said its market share for the 52 weeks ending September 2023 increased by 124 basis points versus the year-earlier period, extending to 55 months of uninterrupted market share gains in its core South African supermarket business.

On a net basis, the group opened 81 stores, the majority in South Africa. Shoprite, which did not give its total number of stores, added that it was on track to open a planned 314 new stores during its 2024 financial year ending June.

With national electricity cuts continuing, the diesel expense to operate generators across its South African supermarket business during its first quarter amounted to 281 million rand ($15.03 million), the retailer said.

The increased cost resulted in the business incurring an additional 90 million rand charge, Shoprite added.

($1 = 18.6933 rand)

(Reporting by Nqobile Dludla; Editing by Kirsten Donovan)