Shoprite's industry leading performance fueled by customer support and strategic execution

Pieter Engelbrecht, Chief Executive Officer:

The growth in sales achieved over this important period is the result of detailed data-led planning and execution, evidenced by our three core South African trading banners and their adjacent new formats collectively adding R10.2 billion in sales to our base for the six months. In the context of selling price inflation of 1.9%, this quantum of additional spend, equating to 10.4% increase in sales was underpinned by strong volume growth as a result of across-the-board gains in the number of customers; customer visits and average basket spend. Pleasingly, and in line with our data-led approach, how this result was achieved talks to the continued momentum of our ecosystem powering the business to learn and adapt its execution and in doing so, continuously improve the value, merchandise and service levels we provide our valued 32 million loyalty-base customers.

We are very proud of this performance, which like the many years now that have preceded it, and we trust, the ones that will follow, is a result of ongoing execution of a multi-year strategy, designed to grow our business and sustain our lead. This result is not due to base effects or acquisitions, in fact quite the contrary, it has been achieved against a higher base than any peers owing to years of sustained market-leading growth. We are not a single brand business operating in a single market segment. We are a multi-brand, platform business operating at scale. Importantly also, our core supermarket operations Checkers, Shoprite and Usave are corporate owned and operated. It is for these reasons that our customer focus, proximity advantage (via stores or on-demand home delivery), leading digital and data-led innovation, expertise in supply chain and day-to-day store execution can combine to consistently deliver every South African household the lowest prices, unbeatable value, best range, unmatched availability and market leading convenience to shop their everyday needs.

The level of leadership and execution across the business, in all areas from stores to shared services, whilst no different to any other period for the Group, was again, remarkable. In particular, I’d like to acknowledge the delivery of certain projects that will advance the business for years to come. Some of them years in the making, embarked from what would have been considered comfortably a market leading position, we were planning our “next”, whilst others are examples of investments made to leverage our platform advantage. Our technology team completed a seamless installation of our new point of sale system rollout across 2 450 stores, some 60 000 hours of work at night whilst stores were closed, together with in-store training of 40 000 employees. This project underscores our dedication to staying at the forefront of retail technology. Our ShopriteX digital team together with our Checkers store operations and Pingo Delivery (Pty) Ltd (Pingo) team successfully delivered millions of orders over the six months whilst concurrently re-platforming our Checkers Sixty60 on-demand grocery delivery tech stack in order to upgrade functionality and most notably, incorporate same-day general merchandise delivery to our on-demand offer. An enormously complex task done ahead of Black Friday and Christmas trade. We remain incredibly humbled by the brand advocacy from Checkers Sixty60 customers who continue to demonstrate their love of Sixty60 in the most priceless ways possible.

Our in-house Freshmark fresh produce business which serves all Group brands including OK Franchise and who over peak season in addition met the needs of the many thousands of customers who as a result of choosing Checkers as their Discovery Vitality HealthyFood partner resulted in a step change in our fresh produce growth, participation and market share. And last but not least, our incredible supply chain team, who in the period spanning our prior interim period through to this one, brought on stream two additional distribution facilities (174 754 m² in Gauteng and Eastern Cape) designed with a few factors in mind: to sustain future volume growth; enhance the Group’s logistics agility; and allow us to better serve regions where supplier service levels were unable to meet our requirements, notably in regions where our customers need us most.

Looking ahead, in the context of a somewhat uncertain global backdrop we will remain focused on our clear and meaningful purpose to improve the lives of our customers and in doing so continue to create value for our stakeholders. We are excited to build on the opportunities our Group structure, centered around our physical stores and digital platform, affords us. Whilst we welcome any tailwinds from improved consumer and business confidence we are not relying on cyclical factors to power our growth. We expect by far the majority of our growth short to medium term will continue to be achieved by our three distinct South African corporate owned and managed supermarket businesses as they focus on their respective customer segments and in doing so increase their share of wallet.

Whilst early days, we expect the addition of more than 10 000 general merchandise products to our re-platformed Checkers Sixty60 app will, over time, bolster our contribution from this category and in some respects, as importantly, continue to reshape how South Africans shop for food and everyday general merchandise. Whilst small relative to the Group, we will continue to expand our new adjacent formats – clothing, baby, outdoor and pet. Notably Petshop Science, grown organically by us, is now at 129 stores (March 2025) with sales for the interim period increasing by 56.9%. Whilst presently small in the Group context, our expansion into these categories is meaningful in the universe of everyday purchases for our customers and important in terms of the role they play in our ecosystem which defines our roadmap for future growth. In addition, the ongoing success of these aforementioned adjacent businesses are expected to support the Group’s alternative revenue growth through businesses such as Rex (our customer insights platform) and Rainmaker (our retail media network).

In closing, my thanks especially to the Group’s 32 million customers and our many stakeholders for their support, specifically those suppliers who have innovated in support of our efforts to keep the cost of food in South Africa as low as possible. This period’s result will lead to the Group having returned R1.5 billion to shareholders in the way of dividends over and above the R997 million spent to buy-back our own shares during the six months. With our Shoprite Employee Trust (SET) distribution aligned to our dividend payments, the total amount distributed to our SET beneficiaries since the Trust’s inception now measures R698 million. It is most gratifying that despite our unrelenting drive to keep selling price inflation contained that we have managed to balance the needs of so many and most notably our customers, saving them R8.9 billion through our Xtra Savings rewards programme whilst also creating 2 989 new jobs, taking our base of employees to just over 163 000. We are proudly South Africa’s largest private sector employer and aspire to remain a net creator of jobs into the future.