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Spar’s profit growth slows

Johannesburg - Spar, a South African food and liquor retailer, said first-half profit growth slowed to 9.4 percent as demand for liquor and building materials failed to offset slower food sales.

Net income rose to 642.9 million rand in the six months through March from 587.6 million rand a year earlier, the Durban-based company said in statement today.

Profit by this measure climbed 13 percent in the first-half of fiscal 2013.

Sales increased 7.6 percent to 25.6 billion rand.

“Trading conditions remain tough with ongoing pressure on consumer spending due to rising unemployment, increasing household debt and interest rates,” the company said.

“Mine strike action has affected trading in certain rural regions through reduced disposable income.”

Spar sales of liquor and building products grew in double-digits, while food suffered from tougher competition, the company said. It declared an interim dividend of 1.95 rand a share, 8.9 percent higher than a year earlier.

South African retail sales growth slowed to 1 percent in March, from 2.3 percent the previous month, as high unemployment and inflation curbed spending. - Bloomberg News

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