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Pick n Pay earnings fall short

Oct 19 2011 09:09 Reuters

Company Data

PICK N PAY STORES LIMITED [JSE:PIK]

Last traded 0
Change 0,37
% Change 0
Cumulative volume 54902
Market cap 25.05bn

Last Updated: 22-10-2014 at 11:21. Prices are delayed by 15 minutes. Source: McGregor BFA

SHOPRITE HOLDINGS LIMITED [JSE:SHP]

Last traded 0
Change 0,6
% Change 0
Cumulative volume 262739
Market cap 82.11bn

Last Updated: 22-10-2014 at 11:20. Prices are delayed by 15 minutes. Source: McGregor BFA

MASSMART HOLDINGS LIMITED [JSE:MSM]

Last traded 0
Change -0,36
% Change 0
Cumulative volume 22416
Market cap 26.51bn

Last Updated: 22-10-2014 at 11:16. Prices are delayed by 15 minutes. Source: McGregor BFA

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Johannesburg - Pick n Pay Stores [JSE:PIK], South Africa's second-biggest grocery retailer, reported a 40% decline in first-half profit on Wednesday, hit by the start-up costs for its newly launched shopper reward programme and investments in its distribution system.

Pick n Pay said on Wednesday headline earnings per share totalled 54.7c in the six months to end-August, compared with 90.17c a year earlier.

The company warned earlier this month that profit could fall as much as 45%.

While consumers gradually warm up to spending in Africa's biggest economy thanks to lower interest rates, Pick n Pay has yet to see the benefits, as it is spending a chunk of its cash to improve its supply chain and protect market share as competition intensifies.

South African retailers are also facing tough competition from Walmart, after the world's biggest retailer took a  51% stake in local retailer Massmart Holdings [JSE:MSM] in June this year.

Pick n Pay said sales increased 7.4% to R27.1bn.

Shares in the company are down more than 24% so far this year, lagging a 15% rise in its closest rival Shoprite Holdings [JSE:SHP].

 
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