Latest news with #R66.1bn
Irish Examiner
08-06-2025
- Business
- Irish Examiner
Spar wants a bigger slice of Ireland's €15bn grocery market
South African headquartered Spar group, in releasing its half-year reporting last week, announced its plan to withdraw from its extensive operations in Switzerland and the UK, but in a surprising move, declared its intention to double down on its investment in Ireland. The group's decision to offload its Swiss and UK retail businesses is part of a strategic realignment towards a more profitable international presence. Spar group chief executive Angelo Swartz stated the group experienced a tough operating environment, particularly in its European operations, while the South African consumer remains under pressure as well. Spar group, which operates the eponymous business in Ireland, England, and Switzerland, as well as in its native South Africa, has reported a marginal decline in turnover, to R66.1bn (€3.26bn), in the first half of its financial year to March 28. In disposing of its Swiss operations, it will cut off €800m in sales, and a further €300m in its British operations. By comparison, Spar Ireland achieved record retail sales of €1.3bn in 2024. Spar's withdrawal from its Swiss and UK divisions highlights a broader trend of reevaluating European retail strategies amid uncertain market conditions. Spar's new business strategy, being unveiled, aims to build on the current momentum of the brand in Ireland. The strategy includes plans for new store openings, upgrading existing sites, and a new design for EuroSpar supermarkets. 'There's a cost-of-living crisis in Europe that's made those markets tougher than I can remember. And in South Africa, we've had an economy that's been struggling to grow for some time and consumers are under real financial pressure with relatively high interest rates, albeit coming down,' according to Angelo Swartz, Spar group chief executive. Commenting on Spar's apparent loss of upper-income shoppers, Swartz acknowledges the extremely competitive environment in the retail space. 'There's certainly truth in the observation that growth in our stores that cater to the lower end of the market has been more robust than at the top end,' Mr Swartz said. 'It's been more competitive at the higher end of the market, most certainly for us.' To prevent its Irish operations from following the same downward trend as its discontinued European ventures, the retailer plans to expand its private-label range, emphasising its value proposition to customers. They also plan to go further by ensuring a diverse product range that aligns with changing consumer preferences. This range must include more organic and healthier options, which will help it compete with major players like SuperValu and Centra in the Irish market. Spar operates with its local partner BWG group, as a leading convenience brand in Ireland and holds a relatively small share of the Irish grocery market, less than 1% according to Bord Bia. While this may appear minor compared to other large players, Spar have a significant presence as one of the largest convenience retail groups in the country, with more than 60 years of history and a network of 463 stores across every county in Ireland and providing employment for 14,000 people locally. Spar group's strategy for Ireland was positively impacted by gross margin increase in recent years, with local performance boosted by lower gearing and cost savings, partially offset by increased labour costs, due to the minimum wage increase. Bord Bia conservatively estimates that the Irish grocery retail market is currently valued at €15bn. The quality of food on offer is of the highest standard. However, as in the world over, current global dynamics are driving up cost of living inflation, which will impact how consumers shop and how retailers respond over the coming months. Relatively speaking, the Irish grocery retail market is quite sophisticated in terms of store design and merchandising, remaining predominantly physical, with online a very small percentage of total sales (5.8%, 12 weeks ending January 26) but it is growing according to Kantar market consultancy. Much like Spar, who plan to open 50 more stores in 2025, other retailers in Ireland are still expanding store numbers to find growth. The Irish retail market is highly competitive, with three retailers: Dunnes Stores, Tesco, and SuperValu (part of Musgrave Group) holding 67.7% of the market between them. Getting a bigger slice of the €15bn Irish market, is clearly a key strategic goal of the Spar group management, but the 'big three' supermarkets won't give up market share without a fight. Read More Irish Mortgage Corporation unveils its new joint managing directors
Yahoo
06-06-2025
- Business
- Yahoo
SPAR Group sees EPS dip despite steady H1 2025 revenue growth
Multinational South Africa-based retail chain SPAR Group's operational performance during the first half (H1) of fiscal 2025 (FY25) has shown mixed results across different regions, with headline earnings per share (EPS) from continuing operations dipping slightly by 0.4% to 450.1 cents. Revenue from ongoing operations held steady at R66.1bn ($3.72bn), with gross profit climbing to R7.1bn. Operating profit experienced a modest rise of 1.6%, reaching R1.5bn, bolstered by enhanced cost management efforts. The group's earnings before interest, taxation, depreciation and amortisation (EBITDA) also saw an uptick of 1.7%, amounting to R1.7bn. SPAR Group made headway on its strategic objectives amidst a tough market environment, focusing on five critical areas: exiting Poland, restructuring debt within the group, conducting a strategic review of European operations, expanding the implementation of SAP [systems, application and data processing], and targeting an improvement in southern Africa EBIT margin to 3%, alongside achieving a leverage ratio between 1.5 and 2.0 times by fiscal year-end 2026. During the first half of 2025, the group achieved three of these goals: finalising the sale of SPAR Poland in January, completing debt restructuring in March, and announcing plans in May to divest its Swiss operations as well as AWG in the UK after thorough strategic evaluation and consideration of capital allocation priorities and long-term strategic direction. The group is in advanced negotiations with potential buyers for these businesses. SPAR Switzerland and AWG have been classified as discontinued operations, with post-tax losses including impairments amounting to R4.4bn. The board believes that the divestments are consistent with SPAR's strategy to concentrate on strengthening its core businesses in Southern Africa and Ireland. Cash generation from total operations significantly increased 50.1% to R1.9bn. In Southern Africa, the group's wholesale turnover increased 1.7%, with its grocery and liquor segments contributing to this growth. Retail revenue in the region also saw an increase of 1.9%. The SPAR2U app's delivery volumes surged 174%, demonstrating the brand's growing on-demand presence. Build it, the group's building materials retail brand, posted a sales increase of 4.1% with strong like-for-like retail growth. In Ireland, despite a marginal local currency revenue decrease, the gross margin benefited from a favourable product mix. The minimum wage increase, however, led to higher labour costs. No interim dividend has been declared for the period, with future considerations dependent on macroeconomic and operating conditions. Looking forward, SPAR Group is concentrating on margin improvement and operational execution in its core markets. In southern Africa, SPAR aims to enhance retail segments and operational efficiencies, with initiatives such as expanding on-demand services and increasing private label product penetration. In Ireland, SPAR Group subsidiary BWG Group, a food retail and wholesale distribution company, is focusing on growing its convenience retail brands and exploring new opportunities. "SPAR Group sees EPS dip despite steady H1 2025 revenue growth" was originally created and published by Retail Insight Network, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
TimesLIVE
04-06-2025
- Business
- TimesLIVE
Supermarket group Spar reports slight drop in earnings
Supermarket retailer Spar Group reported on Wednesday a marginal decline in half-year earnings as group revenue from continuing operations remained steady at R66.1bn. The retailer said headline earnings per share from continuing operations fell by 0.4% to 450.1c in the 26 weeks ended March 28, down from 451.9c a year earlier. Group operating profit increased by 1.6% to R1.5bn, supported by improved cost discipline, with its operating margin stable at 2.2%. In Southern Africa, wholesale turnover increased by 1.7% to R49.9bn, reflecting the ongoing pressure on consumer spending, compounded by lower food inflation, Mozambique post-election unrest, the timing of Easter falling in the second half of this financial year and shop closures in Gauteng, Spar said. Combined grocery and liquor wholesale revenue rose by 1.1%, while retail revenue increased by 1.9%, with like-for-like sales up 1.6%. Growth was underpinned by strong momentum in the lower-income customer segment, while the middle and upper segments' performance lagged the market, the retailer said. Ireland reported local currency revenue fell by 0.6% in an environment where inflation is challenging volumes in the retail convenience sector.
TimesLIVE
16-05-2025
- Politics
- TimesLIVE
UAT outraged as Gauteng returns unspent R1bn to National Treasury
The United Africans Transformation (UAT) party expressed its disappointment at the Gauteng government after it was revealed that more than R1bn earmarked for critical services had been returned to the National Treasury due to underspending in the 2024/25 financial year. Provincial Treasury department head, Ncumisa Mnyani said on Monday that the department of health did not spend R724.6m of its R66bn allocated budget, while the department of education also failed to use R317.35m of its R66.1bn budget, Sowetan reported. The political party said people of Gauteng cannot continue to suffer because government officials are too slow, too disorganised, or too complacent to do their jobs. 'How does a government with a R66bn health budget fail to spend R724m, when clinics remain understaffed and healthcare infrastructure is crumbling? 'How does a department with a R66.1bn education budget fail to spend R317m, while township schools face overcrowding, poor sanitation and infrastructure backlogs?' the party said. It said Gauteng's infrastructure and services were in dire need of attention. This included roads with unaddressed potholes and maintenance needs, continuous power outages affecting daily life and economic productivity and underfunded schools requiring renovations for a conducive learning environment. 'The returned funds could have fixed our roads, schools and many more. Instead, we're stuck with potholes and darkness, crime, unemployment, lack of housing etc.'
