The SPAR Group (SPP) Trading Update summary

Trading performance and sales trends

• Total sales from continuing operations declined by 1.6% for the 18 weeks to 31 January 2025, reflecting constrained consumer spending across all regions.

• Retail sales grew 3.4% across 2,029 supermarket and liquor stores, with same store sales up 3.0%, slightly ahead of national inflation.

• Lower-income grocery stores saw robust growth, while middle- and higher-end stores experienced subdued performance.

• Build it segment achieved 7.3% turnover growth; SPAR Health posted strong 13.3% turnover growth, driven by wholesaler and Scriptwise sales.

• SPAR2U, the on-demand shopping platform, recorded a 285% increase in order volumes year-on-year.

Regional performance and operational updates

• BWG Group (Ireland and South West England) sales decreased by 1.6% in EUR, impacted by cost-of-living pressures and consumer shifts to larger formats.

• SPAR Switzerland turnover fell 5.2% in CHF, affected by higher living costs and increased competition, though private-label products remain a strength.

• Operating losses from corporate grocery and liquor stores were reduced through improved performance and closure of non-performing stores.

• KZN region saw a positive recovery with improved loyalty, gross profit, and trading profit margins, achieving four consecutive months of profitability.

Strategic initiatives and outlook

• Finalisation of SPAR Poland disposal on 31 January 2025 marked a key milestone; European strategic review to be completed by June 2025.

• SAP system issues in KZN have been resolved, with further rollout planned for Build it Imports Warehouse and Eastern Cape DC in H1 2026.

• Focus remains on cost control, margin management, and strengthening the balance sheet through debt reduction and disposal of non-core properties.

• Margin recovery in Southern Africa supported by KZN DC improvements, ongoing disposal of non-performing stores, and operational efficiencies.