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Johannesburg – Supermarket chain Shoprite Holdings [JSE:SHP] said on Monday group turnover was 9.7% up in the first quarter ended September 2010, in a trading environment characterised by depressed market conditions.
It said in a sales update that Supermarkets RSA, the group's core business, grew turnover by 8.5% while internal food inflation averaged -1.5% during the period. The division includes the Shoprite chain, the U-Save Shoprite format and Checkers.
Shoprite CEO Whitey Basson said judging by the growth in basket size and the increase in the number of customer transactions, the group believed Supermarkets RSA was able to make further gains in local market share.
"However, as market share information for the food retailing sector is no longer made available, this perceived growth could not be confirmed," said Basson.
The single-digit growth in topline figures confirms the tough conditions food retailers are battling, mainly arising from restrained consumer spending and low inflation.
Reporting for the six months to August, Pick n Pay CEO Nick Badminton said cautious consumers are shopping more often but buying fewer items, adding conditions are expected to remain tough for the remainder of the year.
Recessionary conditions continue to curtail economic growth in Africa while a further surge in relative rand strength placed more pressure on food exports from South Africa, Basson said.
He said in constant currency terms, non-RSA sales increased by 13.5% and in rand terms by 2.1%.
The furniture division, which includes OK Furniture and House & Home, increased turnover by 7.2% during the three-month period.
Other divisions, which combine the results of the franchise division, Medirite and Computicket, increased turnover by 46% mainly as a result of the acquisition of Transfarm Pharmaceutical Wholesalers at the end of 2009.
Basson said stores are being well provisioned for the festive season, which would be the determining factor for success in first half of the year.
- Fin24
It said in a sales update that Supermarkets RSA, the group's core business, grew turnover by 8.5% while internal food inflation averaged -1.5% during the period. The division includes the Shoprite chain, the U-Save Shoprite format and Checkers.
Shoprite CEO Whitey Basson said judging by the growth in basket size and the increase in the number of customer transactions, the group believed Supermarkets RSA was able to make further gains in local market share.
"However, as market share information for the food retailing sector is no longer made available, this perceived growth could not be confirmed," said Basson.
The single-digit growth in topline figures confirms the tough conditions food retailers are battling, mainly arising from restrained consumer spending and low inflation.
Reporting for the six months to August, Pick n Pay CEO Nick Badminton said cautious consumers are shopping more often but buying fewer items, adding conditions are expected to remain tough for the remainder of the year.
Recessionary conditions continue to curtail economic growth in Africa while a further surge in relative rand strength placed more pressure on food exports from South Africa, Basson said.
He said in constant currency terms, non-RSA sales increased by 13.5% and in rand terms by 2.1%.
The furniture division, which includes OK Furniture and House & Home, increased turnover by 7.2% during the three-month period.
Other divisions, which combine the results of the franchise division, Medirite and Computicket, increased turnover by 46% mainly as a result of the acquisition of Transfarm Pharmaceutical Wholesalers at the end of 2009.
Basson said stores are being well provisioned for the festive season, which would be the determining factor for success in first half of the year.
- Fin24
