JOHANNESBURG (Reuters) – Pepkor Holdings, owner of South African discount retailer brands PEP and Ackermans, reported a 20.1% jump in full-year earnings on Tuesday, as cash-strapped shoppers fuelled demand at its expanding chains of discount stores.
Pepkor, majority-owned by Steinhoff International Holdings, said headline earnings per share – the main profit measure in South Africa, – rose to 162.6 cents in the year ended Sept. 30, up from 135.4 cents a year earlier.
The discount fashion and homewares retailer, with more than 5,800 stores across Africa and Brazil, reported revenue growth of 5.3% to 81.4 billion rand ($4.70 billion).
While sales rose, the growth rate was slower than the 9.2% growth in the prior year due to flooding of its PEP distribution centre, which represents 40% of the PEP business’ total distribution capacity, delay in social grant payments and damaged stores, as a result of a civil unrest in 2021.
Pepkor said higher levels of inflation are expected during the upcoming winter season and the group’s merchandise teams “continue to focus on supporting customers by minimising price increases.”
Supply chain disruptions have reduced, including the cost of shipping, it added.
While its shoppers continued to shop at its discount stores, Pepkor said it was concerned about consumer spending power given the macroeconomic backdrop.
($1 = 17.3101 rand)
(Reporting by Nqobile Dludla; Editing by Tom Hogue)
