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Retail

Spar Group Sees Sales Up, But Faces Delays In Poland Development

South Africa's Spar Group has seen sales rise in Ireland, Switzerland and its Southern Africa base, however the development of its Polish operations has been hampered by COVID-19 restrictions, the company said in a trading update.

In an update covering the 48-week period to 28 August 2020, the group, which recently announced a number of forthcoming management changes, said that its core Southern Africa business increased sales by 4.8%, with its Spar operations growing by 8.7%, or 7.5% on a like-for-like basis.

Due to a temporary trading ban, liquor sales were down 16.4%, while its Build It home improvement chain also saw a 3.5% dip in sales.

Ireland Growth

In Ireland, despite its foodservice and cash-and-carry businesses taking a hit, its BWG Group business posted a 5.5% increase in turnover (in euro terms), with local shops reporting 'increased business activity' due to lockdown restrictions.

'This increased retail brand performance has largely compensated for the lost business in other sectors,' it said, noting that growth over the past five months was 8.0%.

'Extraordinary' Performance

In Switzerland, Spar Group said that its performance was 'extraordinary', as the business posted turnover growth of 11.4% (in CHF terms) for the period, and 19.7% growth over the past five months.

'Consumers have supported the local retailers extensively during this period and both wholesale and retail sales have increased significantly,' the group said. 'In addition, the business has also benefitted from the increased cash and carry trade as the hospitality sector reported abnormal improvements.'

Poland Frustrations

In Poland, however, the business has faced frustrations, with the 'integration and onboarding' process suffering delays due to COVID-19.

It said that trading performance is 'tracking behind expectations' in the market, with restructuring procedures also facing delays. Spar Group said that it was 'confident' that the Polish business will contribute positively to the group's sales by the end of 2021.

On a group level, Spar Group increased sales by 12.4% from R99.67 billion (€5.2 billion) to R112.04 billion (€5.85 billion) for the period.

© 2019 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.

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