By Alex C
Stock price of Shoprite, Africa’s biggest grocery firm, rose impressively after the company said it had increased turnover by 12.3 percent in the quarter to September in 2014. The stock gained 7 percent during intra-day trading on the Johannesburg Stock Exchange (JSE) on Monday in what indicated that investors liked the trading update that the company had released earlier in the day.
Shoprite said it had achieved a 12.3 percent surge in turnover despite local market conditions remaining relatively unchanged with the South African consumers being under pressure.
The company has its core business in South Africa where it was first started 35 years ago. The group’s South African Supermarkets, increased turnover by 11.9 percent which is ahead of the food retail industry growth.
The group’s Non-South African Supermarkets increased turnover by 15.9 percent and in constant currency terms, by 16.1 percent. Shoprite’s growth was affected by the sale of the Tanzanian business and the loss of a store in Angola due to fire.
The performance of the Group’s non-South African operations was supported by the opening of 18 new food outlets outside of South Africa since October 2013 last year. The country’s highly-competitive market conditions in which the furniture division traded remained virtually unchanged, the group said.
A further 27 new supermarkets will be opened before 31 December this year. “Although the Group is well prepared and expects fair trading conditions in the run-up to Christmas, it is difficult to predict festive season consumer spending patterns,” the company said recently.