Pepkor Holdings Limited (PPH) H1 2026 earnings summary

Executive summary

• Revenue grew 13.2% year-over-year to R54.8 billion, with operating profit up 9.4% to R6.3 billion and normalized HEPS up 12.1%, despite a challenging macroeconomic environment.

• 89 new stores opened, expanding the retail footprint to 6,657 stores, with market share gains and online sales up 30.9%.

• Strategic acquisitions included Shoprite furniture non-RSA, Legit, Swagga, Style, and CloudBadger Technologies, with successful integration.

• Financial services, especially FoneYam, showed exponential growth with 1.3 million activations; banking license approval received, with launch targeted for April next year.

• Shoe City operations discontinued due to underperformance.

Financial highlights

• Gross profit margin improved by 170bps to 40.8%, mainly from financial services and insurance.

• EBITDA rose 11.6% to R9.1 billion; operating profit up 9.4% to R6.3 billion.

• HEPS increased 10.3% to 93.1c; normalized HEPS up 12.1%.

• Cash generated from operations was R4.1 billion, up 15.1% year-over-year, with a 68% cash conversion rate.

• Net debt rose to R14.9 billion, with net debt-to-EBITDA at 1.22x, due to dividend and M&A payments.

Outlook and guidance

• Like-for-like sales up 3.7% in the first eight weeks post-period, with continued focus on strategic priorities, store expansion, and integrating acquisitions.

• Banking project on track for April launch, pending regulatory clearance.

• Expense growth expected to slow in H2 as M&A and project investments normalize.

• HEPS growth for the full year guided at 10%, with 10–15% targeted for the next three years.

• High growth momentum expected across all platforms, despite inflationary and geopolitical pressures.