Pick n Pay Group said it delivered a “resilient” performance in its financial results for the year ended 26 February 2023, despite the damaging impact of load shedding on its bottom line. Its shares plunged.

The retailer said it had to contend with unprecedented levels of load shedding during the year, spending R522-million on diesel to run generators (R430-million net of electricity savings), as well as incurring planned costs in implementing its Ekuseni strategic plan.

It managed to hold year-on-year trading expense growth to just 11.9% as a result of gains from project future cost-saving initiatives.

Group turnover increased by 8.9%, with another market-leading performance from Boxer, whose sales growth in South Africa was up 20.2%. Boxer opened 60 new stores in the year, and is on track to deliver its target of opening 200 stores and doubling sales by 2026.

Online sales growth was a stunning 72%, with on-demand sales up well over 100%, driven by both asap! and the October launch of Pick n Pay groceries on Takealot’s Mr D app.

It was an intensive period for the group as execution of the Ekuseni strategic plan began, while simultaneously dealing with high levels of load shedding during the second half of the financial year. The results achieved in year one of the multi-year plan have been encouraging, particularly in respect of the growth of Boxer.

Pick n Pay said it will continue to drive its capital investment programme while carefully balancing investment against the cost of diesel to keep stores open, which naturally add to the operational challenges. It is working intensively to reduce monthly diesel costs, but the results will ultimately depend on the levels of load shedding experienced.

Read: Pick n Pay is gearing up for permanent load shedding

Pick n Pay’s share price was last quoted at R38.49 each shortly after midday on Thursday, down 6.6% on the session. The shares had earlier dipped to as low as R37.25 as investors digested the group’s numbers, including the fact that it cut its total full-year dividend by 16.3%. – © 2023 NewsCentral Media