Overview
- The group reported weaker full-year results with turnover of R120.3 billion and group trading profit falling to R1.7 billion as the Pick n Pay supermarket division recorded a R1 billion trading loss.
- Boxer, the discount chain, grew sales by 12.3% and added about R330 million in trading profit, which helped limit the group’s overall headline loss to R363 million, an improvement of R45 million year on year.
- Management has implemented a salary freeze and cut support-office headcount under a 'future-fit' plan and has opened a formal Section 189 consultation process, facilitated by the CCMA, to address what it says are structurally high store labour costs.
- Pick n Pay says it has proposed a new, fair labour model intended to protect jobs where possible even as it seeks to align employment costs with industry peers, and it warned that external pressures such as rising fuel costs could slow recovery.
- Operational signs of progress include a 32.7% rise in online turnover, a gross margin increase to 18.8%, and 3.9% like-for-like growth in company-owned stores, but management says returning the core supermarket business to sustainable profits will take time and disciplined execution.