By ThinkBusiness Africa
Shoprite Holdings, South Africa’s largest grocer, reported a 7.7% increase in half-year headline earnings per share to 710.5 cents on Tuesday, defying a muted festive season by aggressively cutting prices and capturing market share through its digital Sixty60 platform.
The group’s interim dividend was hiked by an identical 7.7% to 307 cents per share, reflecting a robust performance where merchandise sales grew by 7.2% to R136.8 billion despite internal price inflation being held at a mere 0.7%.
Earnings before interest, income tax, depreciation and amortisation increased by 6.7% to 12.4 billion rand ($767 million).
This growth came as Shoprite intentionally absorbed cost pressures to maintain price leadership, providing a record R9.7 billion in Xtra Savings discounts to customers during the 26 weeks ended December 28, 2025.
CEO Pieter Engelbrecht noted that the core South African supermarket business grew at 2.3 times the “rest of market” rate during the half-year. This competitive gap widened significantly during the critical November and December trading period, where Shoprite outperformed its competitors by 5.3 times, highlighting a massive shift in consumer volume toward the group’s value-focused banners.
The premium Checkers and Checkers Hyper segments grew sales by 8.9%, but the standout performer remained the Sixty60 on-demand delivery service, which saw sales surge by 34.6% to reach R11.9 billion.
Meanwhile, the group’s mass-market brands, Shoprite and Usave, focused on extreme affordability, navigating internal deflation of 0.1% and 0.7% respectively. This strategic decision to keep prices below the national food inflation rate of 4.7% resulted in a slight easing of the gross margin to 23.8%, down from 23.9% the previous year.
Looking ahead to the remainder of 2026, Shoprite expects low single-digit selling price inflation to persist.
“In terms of the remainder of our second-half 2026 period, we are of the view that low single-digit selling price inflation is likely to be sustained” ShopRite said.
With the successful sale of its non-South African furniture businesses now concluded and 273 new stores opened over the last 12 months, the retailer is positioned to maintain its dominance through both physical expansion and market-leading digital execution.
