Shoprite, South Africa's biggest supermarket group, reported a nearly 14% jump in its half-year sales, supported by a record Black Friday and festive season as cash-strapped shoppers and upmarket consumers went after food deals.
The retailer, with more than 2,900 stores across Africa, said group sales for the six-month period ended 31 December rose to 121.1 billion rand ($6.44 billion). Sales in the company's second quarter, which include November and the Christmas holiday period, rose 14.6%.
Cash-strapped shoppers, hit by high interest rates and inflation, are spending less on discretionary items like clothes and shoes and more on food and essentials.
'Sustained high level of execution and continued customer momentum together with record Black Friday and festive season trade has extended the period of uninterrupted market share gains achieved by our core South African supermarket brands to 58 months,' the retailer said.
The group's core business, Supermarkets South Africa, which contributes about 80.5% to the top line, witnessed a 14.6% jump in sales, also benefiting from the acquisition of 94 stores bought from Walmart-owned Massmart. Like-for-like sales climbed 6.3%.
Sales in rest of its stores in Africa rose 6.2% in South African rand terms and by 20% in constant currency.
Like its peers, Shoprite is grappling with severe rolling power cuts, forcing it to crank up diesel generators and spend more on back-up power supplies, adding to soaring costs for raw materials, transport and packaging.
The power outages resulted in diesel expenses of 500 million rand in the reported period.
In September of last, the retail group announced plans to spend about 8.5 billion rand (€410 million) to increase supply chain capacity, add stores and strengthen its digital capability after posting a 9.6% rise in annual profit.