Pick n Pay results show recovery is starting to take shape

Pick n Pay has reported a reduction in full-year losses as its recovery starts taking shape.

For almost two years, Pick n Pay embarked on a turnaround strategy to curb the losses and improve its operations. The turnaround included closing, franchising some Pick n Pay outlets, or converting loss-making stores into Boxer, unbundling Boxer into a standalone JSE listed entity and raising R4bn from shareholders. Attributable loss after tax for the year to March was R736m, down from R3.3bn the same period last year.

“There are no surprises in the result. We are meeting the guidance we have given every six months, making calm and steady progress. You cannot rely on quick wins in our situation, and it will continue to be a journey as we rebuild our institutional memory,” CEO Sean Summers said about the Pick n Pay Group results for the 53 weeks to March 2 2025 released today.

“This was an important year for Pick n Pay as we executed the first leg of our operational and financial recovery. We are exactly where we said we would be when presenting the strategy last May, and in some aspects we are tracking slightly ahead. Particularly pleasing is the reduction in our Pick n Pay trading loss by 64% after predicting a 50% reduction”

The first of its six strategic priorities announced in May last year was to recapitalise the Group. In this financial year, the Group completed its two-step recapitalisation plan, raising R12.5bn through the Pick n Pay rights offer (R4bn) and the Boxer JSE listing (R8.5bn) and restoring the Group to a net cash position of R4.2bn.

“We have started to give much-needed attention to our core Pick n Pay supermarkets and we are pleased to see the early results in reporting positive like-for-like (LfL) sales growth, notwithstanding the sustained pace of new store openings by our competitors in a restrained and competitive market,” said Summers.

Company-owned supermarkets delivered consistent gains in sales growth, improving from -0.5% in the 2024 financial year to +3.6% in the period under review.

“Our franchisees have also shown steady positive recovery and the positive LfL momentum has continued in the first eight weeks of FY26,” said Pick n Pay.

Summers said some of the loss-making stores that were converted are returning to profitability.

Pick n Pay has also started opening new stores and will increasingly refurbish its supermarkets.

Pick n Pay Clothing delivered 11.6% growth from standalone stores. It opened 30 company-owned stores during the financial year, to bring the total estate to 415 stores.

“When I returned in October 2023 I stated the recovery of Pick n Pay would be a multiyear process and that things would get worse before they got better. It is our sense that we see this unfortunate chapter bottoming out and we have recalibrated our recovery programme to break even in FY28.”

Business Times