Cheers for delivery app and new jobs at Shoprite but blow from July riots endures
Supermarket giant Shoprite has buffered costs related to Covid-19 and civil unrest with innovation in digital and customer rewards programmes.
Announcing an increase of 20.1% in diluted headline earnings per share to 952.5c for the year, CEO Pieter Engelbrecht said on Tuesday the group had increased sales of merchandise by 8.1%.
On the downside, the group disclosed that significant damage was caused to 231 of its stores during July’s civil unrest in KwaZulu-Natal and Gauteng. As at August 22, the group said 83 stores remained closed.
“Of these, 47 stores have been significantly impacted by fire and the process of reopening for these stores will be mixed. Some may open in the coming months, some may take a year, others will require new premises,” it said.
“Of the total stores impacted we have taken the decision to not reopen in six locations.”
Its LiquorShop sales growth of 4.4% for the year was a result of the impact of Covid-19 lockdown regulations which impacted trade, both throughout the 2021 year and during the second half base in 2020. It required the complete closure of the liquor business for 144 days (in 2020 closed for 66 days) during the reporting period.
On the upside, its Checkers supermarket chain increased sales of merchandise by 10.9%, boosted by its Xtra Savings Rewards Programme and Sixty60 app, the on-demand grocery delivery service, which “has outperformed all initial estimates”, it said.
The Sixty60 service has been rolled out to 233 stores, an increase of 146 stores since the previous financial year.
The Shoprite and Usave brands collectively increased sales by 8.8%, with accelerated growth experienced during the second half of the year achieved on the back of the launch of the Shoprite rewards card with 12.7-million sign-ups since the launch.
The team has become increasingly collaborative and innovative. This way of working influences our daily decisions across the business.Shoprite CEO Pieter Engelbrecht
“There is no doubt the digitally led future being ushered in for many as a result of the Covid-19 crisis is already a day-to-day reality for Shoprite,” Engelbrecht said.
“However, from an IT perspective, with the adoption of our single system of record a few years ago, the team has become increasingly collaborative and innovative. This way of working influences our daily decisions across the business and plays an increasing role in our ongoing success.
“In addition to transforming how we operate, our IT re-platforming has facilitated and fast-tracked our transformation as part of our digital and data-led future strategy.
“Consumer response has been unrivalled, with the Xtra Savings rewards programme signing up more than 20-million members and Checkers Sixty60 becoming the number one grocery app in the country with more than 1.5-million downloads.”
He said Shoprite, SA’s largest private sector employer, added 3,897 new jobs in the year.