Pick n Pay surges despite R2.8bn store writedown

Embattled retailer Pick n Pay warned on Wednesday it is writing down its loss-making and underperforming stores by R2.8 billion, further warning of a hefty full-year loss when it reports results next week.

The retailer, whose shares have fallen by two-thirds in the past five years, warned of a comparable loss per share of as much as about R2.81 in its year to 25 February, from earnings per share of about R2.64 in the prior year. It had booked earnings of about R1.3 billion in 2023, with the comparable metric excluding problems such as hyperinflation in Zimbabwe.

But it was also hit by gross profit margin contraction and trading expense growth exceeding sales growth in its core Pick n Pay Supermarkets business, with its SA business seeing sales fall 0.2% despite price inflation of over 7%. However, both discount chain Boxer and its clothing business fared far better in growing sales more than 17%.South Africans need to be in the know if we want to create a prosperous future.

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Sean Summers Retail

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