Pepkor’s revenue surges to R53.9 billion despite constrained environment
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PEPKOR Holdings closed firmer on the JSE on Friday following news that revenue for the nine months to the end of June had rocketed 13.9 percent to R53.9 billion despite a constrained retail environment.
Pepkor shares closed 4.26 percent higher at R20.79 a share as the retailer said its revenue growth for the three months to the end of June had accelerated 27.9 percent.
Pepkor, a subsidiary of Steinhoff International Holdings, said the group expected the retail environment to continue to be constrained as a result of the long-term impact of Covid-19 on the economy, exacerbated by the recent civil unrest.
“The group’s unparalleled position in the discount and value retail market segments continues to be increasingly relevant in addressing consumer needs,” it said.
The retailer said after a thorough assessment, a total of 529 stores across the group has been impacted by the mayhem in Gauteng and KwaZulu-Natal earlier this month.
“Stores were burnt, looted or damaged to varying degrees. This represents approximately 10 percent of the group’s total retail store base. In addition, one of the JD Group’s distribution centres in Cato Ridge, KwaZulu-Natal,was looted,” said the group.
Pepkor said trading was disrupted, with a number of stores intermittently closed in the affected areas as a precautionary measure to ensure the safety of employees and customers.
“In addition, the group’s supply chain and distribution operations were severely disrupted in the affected areas as the group took swift action to deploy extensive tactical measures to protect and safeguard its infrastructure,” said Pepkor.
Pepkor said previously that 489 of its stores, which was equal to 9 percent of its footprint, had been damaged by the looting.
Although the company said it had the necessary insurance to cover mitigate losses incurred during the unrest, additional costs had been incurred to safeguard assets and infrastructure.
Pepkor said clothing and general merchandise revenue for the period had increased by 14 percent and 28.7 percent for the third quarter.
“Pep and Ackermans continued to grow market share on a 12-month rolling period, according to the latest Retailers’ Liaison Committee data, albeit at a slower rate, which was expected following the high base and significant market share gains achieved since May 2020. Retail space expanded by 3.2 percent year-on-year, with 56 new store openings during the third quarter,” Pepkor said.
Sales growth at Pep and Ackermans was 15.5 percent higher in the nine months ended June, and like-for-like sales growth was 13.3 percent higher.