Shoprite (SHP) investor relations material

Executive summary

• Group sales grew 8.9% to R252–R252.7 billion, surpassing R250 billion for the first time, with trading profit up 16.6% to R15 billion and gross margin improving by 40 bps to 24.3%.

• Diluted headline earnings per share (DEHEPS/DHEPS) rose 15.8% year-over-year, and return on equity reached 26.7%.

• Supermarkets RSA delivered 9.5% sales growth, outpacing the market for the sixth consecutive year, with internal food inflation at a six-year low of 2.3%.

• Market share increased by R8 billion in the supermarket segment, marking six consecutive years of gains.

• 281 net new stores opened and 8,723 new jobs created, with the acquisition of the remaining 50% of Pingo Delivery and sale of the furniture business to Pepkor Holdings Ltd.

Financial highlights

• EBITDA increased 18.8% to R23.8 billion, with a trading margin of 5.9% for the group.

• Supermarkets RSA sales grew 9.5% to R213.5–R214 billion; Checkers and Checkers Hyper up 13.8% to R95.7 billion.

• Adjacent businesses grew 39.1% to R1.1 billion; Supermarkets Non-RSA up 6.4% to R20.5–R20.6 billion.

• Final dividend increased 11.5% to R4.96, with a full-year dividend up 9.7% to R7.81.

• Inventories for continuing operations rose 4.9% to R29.7 billion.

Outlook and guidance

• Targeting 26% income margin and aiming to improve expense margin to 20%, supporting a 6% trading margin.

• 309 new stores planned for FY26, with capex targeting below 3% of sales.

• Internal food inflation expected to remain low, with July at 1.8%.

• No anticipated increase in borrowings due to expected proceeds from the furniture transaction.

• Effective tax rate expected between 27.0% and 28.0%.