Africa’s biggest grocer Shoprite posted slightly faster first-half profit growth on Tuesday, as debt-laden consumers took advantage of lower fuel prices and a price war between supermarket chains.
Shoprite, which focuses on staple products for low-income and working-class consumers, said diluted headline EPS rose 8.6 per cent to 370.2 cents in the six months to the end of June, slightly faster than an 8 per cent growth achieved a year earlier.
Headline EPS, the widely watched profit measure in South Africa, strips out certain one-off items.
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Shoprite, which runs nearly 200 outlets in several other African countries outside its home market, said sales increased 12 percent to 57.4 billion rand ($4.9bn).
Retailers in Africa’s most advanced economy have been struggling in recent years as consumers grapple with high personal debt and unemployment. But falling fuel prices in recent months have boosted their disposable income and reduced logistical costs for supermarket chains in competition for market share.
Industry-wide retail sales grew faster-than-expected December, official data showed last week. Shares in Shoprite were down 0.9 percent at 177.24 rand by 0831 GMT, lagging a 0.34 percent gain the JSE Top-40 index.
