Johannesburg - Africa's biggest grocer Shoprite Holdings
[JSE:SHP] booked a 15.6% jump in first-quarter sales helped by a robust showing
outside its core South African market and favourable currency swings.
Shoprite, which operates in 17 African countries outside
South Africa, said on Monday stores in those markets grew sales by 34.3% in the
three months to end-September. It said in constant currency terms, they delivered
a sales growth of 26.4%.
The Cape Town-based company, which opened 20 stores in
several African countries since November last year, has been pushing
aggressively into fast-growing markets on the continent with a focus on
Nigeria, the Democratic Republic of Congo and Angola.
By 08:45 GMT, shares in the company were up 1.36% at 180.32,
extending gains so far this year to more than 30% and reflecting expectations
of healthy returns from its expansions in the rest of Africa.
Domestic retailers, which are also expanding into the rest
of Africa, have been the darlings of investors in recent months but most
analysts have said they have pushed shares to unjustifiable levels.
Shoprite’s mainstay South African supermarket business grew
sales by 12.2%, reflecting increasing competition in the grocery market where
Walmart’s South African unit Massmart Holdings [JSE:MSM] is
looking for a bigger presence.
The company said it was difficult to predict spending
patterns into the festive season because consumers are under pressures.
Consumers are battling with high personal debt levels,
rising electricity prices and chronic unemployment but above-inflation wage
hikes and decades-low interest rates have somewhat softened the blow.
Shoprite shares rose more than 1% to R178, becoming the
biggest percentage gainer on the benchmark Top 40 - (Tradeable) [JSE:J200]