Source: Reuters
21/10/2009
Johannesburg, Oct 21 - Africa's second-biggest grocer Pick 'n Pay plans to boost investment after posting an 11.1 percent rise in half-year headline earnings per share and an increase in turnover and market share.
Pick 'n Pay said headline EPS for the six months to end-August was 100.30 cents, in line with the company's own forecast. The group said it hoped recent rate cuts would kickstart consumer spending.
Profit before tax was 927.8 million rand ($127.1 million), an increase of 35.9 percent on the previous year, while turnover rose 12.3 percent to 26.6 billion rand.
The company, which like other South African retailers has seen sales slowing in the wake of the global financial crisis, said it planned more investment in its operations.
"We have seen substantive...investment in the business over the last three years and the period ahead will see even more," the company said in a statement.
By 0907 GMT, Pick 'n Pay shares were 0.38 percent down at 39.35 rand, underperforming the JSE Securities Exchange's blue chip Top-40 index and the General Retailer index.
RMB Morgan Stanley analyst Danie Pretorius said the results held no surprises but did show that "margins are coming a little bit under pressure."
"Because they've had to be a little bit more competitive on pricing, the growth margins have been squeezed and because of electricity price increases, the investment they've made in centralised distribution in the short term carries additional costs for them."
The interim dividend for Pick 'n Pay Stores increased 11.2 percent to 39.75 cents.
Pick 'n Pay, which competes with Shoprite, Spar and Woolworths, said continuing operations gained 0.4 percent of market share in the first half.
South African retailers have experienced a tougher year with retail sales dropping by a worse than expected 7.0 percent annually in August, raising hopes for an interest rate cut this Thursday.
Pick 'n Pay also announced that founder Raymond Ackerman, involved with the group for four decades, would retire as chairman in March 2010 and that his son Gareth would become non-executive chairman.
Pretorius saw no disruption for the group.
"This is going to be a start of a new era ... Gareth is the chairman of the Pick 'n Pay holding company and has been for many years," he said.
21/10/2009
Johannesburg, Oct 21 - Africa's second-biggest grocer Pick 'n Pay plans to boost investment after posting an 11.1 percent rise in half-year headline earnings per share and an increase in turnover and market share.
Pick 'n Pay said headline EPS for the six months to end-August was 100.30 cents, in line with the company's own forecast. The group said it hoped recent rate cuts would kickstart consumer spending.
Profit before tax was 927.8 million rand ($127.1 million), an increase of 35.9 percent on the previous year, while turnover rose 12.3 percent to 26.6 billion rand.
The company, which like other South African retailers has seen sales slowing in the wake of the global financial crisis, said it planned more investment in its operations.
"We have seen substantive...investment in the business over the last three years and the period ahead will see even more," the company said in a statement.
By 0907 GMT, Pick 'n Pay shares were 0.38 percent down at 39.35 rand, underperforming the JSE Securities Exchange's blue chip Top-40 index and the General Retailer index.
RMB Morgan Stanley analyst Danie Pretorius said the results held no surprises but did show that "margins are coming a little bit under pressure."
"Because they've had to be a little bit more competitive on pricing, the growth margins have been squeezed and because of electricity price increases, the investment they've made in centralised distribution in the short term carries additional costs for them."
The interim dividend for Pick 'n Pay Stores increased 11.2 percent to 39.75 cents.
Pick 'n Pay, which competes with Shoprite, Spar and Woolworths, said continuing operations gained 0.4 percent of market share in the first half.
South African retailers have experienced a tougher year with retail sales dropping by a worse than expected 7.0 percent annually in August, raising hopes for an interest rate cut this Thursday.
Pick 'n Pay also announced that founder Raymond Ackerman, involved with the group for four decades, would retire as chairman in March 2010 and that his son Gareth would become non-executive chairman.
Pretorius saw no disruption for the group.
"This is going to be a start of a new era ... Gareth is the chairman of the Pick 'n Pay holding company and has been for many years," he said.
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