Despite the challenging year, we are proud to report Shoprite Group’s 6.4% increase in sales to a record R156.9 billion, says Shoprite Chief Executive Officer, Pieter Engelbrecht.
Reviewing the Group’s results for the 52 weeks to June 28, 2020, on Tuesday, Engelbrecht said despite significant COVID-19 lockdown restrictions affecting the Group to varying degrees, the South African Supermarkets operating segment posted 8.7% sales, representing R9.8 billion an increase to R122.4 billion.
The vigorous growth of 7.5 supported SA Supermarket sales increase of 8.7% for the year in the second half, despite the previous year’s high base where fourth-quarter sales were 9, 4% up.
No less, if not more difficult, circumstances stemming from the COVID-19 lockdown regulations, the second half of supermarkets outside SA saw sales grow by 0.1%, resulting in a total 1.4 % sales drop for the year, but at a constant exchange rate sale increased by 6.6%.
The Group’s other operating segments, which accounted for 6.9% of merged sales and included OK Franchise, Transpharm, MediRite Pharmacies, Checkers Food Services, and Computicket, achieved a sales growth of 3.9% in the reporting year.
In the previous year, for the application of accounting in Angola, the group reported a net cash profit of R947 million as of 30 June 2019. The R8 billion profit from trading with SA supermarkets was up 13.0% and recorded a trading margin of 6.6%.
The effective tax rate is higher than the nominal income tax rate in South Africa, mainly for the previously recognised repayment of deferred income tax assets, where the current economic environment in several countries outside the Republic of South Africa has deteriorated so much over the years that no there is more assurance whether the calculated accumulated tax losses for future use.
Cash and cash equivalents and overdrafts Net cash and cash equivalents increased by R6.4 billion due to increased cash flow from operating activities, reduced investment, less asset management, and an increase in working capital ratio.
The Group’s other operating segments, representing 6.9% of Group sales and comprising OK Franchise, Transpharm, MediRite Pharmacies, Checkers Food Services, and Computicket, achieved a sales growth of 3.9% for the year.
The effective tax rate is higher than the nominal income tax rate in South Africa, mainly for the derecognition of deferred income tax assets previously recognized, where the current economic environment of certain non-SA countries deteriorated during the year so much that it is no longer certain that accumulated assessed tax losses for future use.