Liquor is TOPS at Spar


Liquor is TOPS at Spar

Published Date: 2019-05-16 | Source: Stephen Gunnion | Author: Stephen Gunnion

Liquor is TOPS at Spar

The supermarket and distribution group reported strong first-half sales from its liquor and hardware segments.

Alcohol and building materials have remained the best sellers at Spar Group, with big increases in sales of both in the first half of its financial year.

Its TOPS liquor brand grew wholesale sales by 19.3% in the six months to end-March, while Build it delivered another strong performance in a weak sector with wholesale turnover up 8.3%. While they stood out, the supermarket and distribution group reported a good performance from most operations despite tough trading markets across all three geographies.

In Ireland, it said BWG Group delivered solid euro-denominated results, with all retail brands continuing to report good turnover growth. Its performance was boosted by the acquisitions of the 4 Aces wholesale business and Corrib Foods during the previous year. SPAR Ireland's retail network now includes 1,381 stores.

Although it made progress in addressing strategic issues at SPAR Switzerland, profitability fell short of expectations. Turnover improved due to an aggressive marketing campaign, but that resulted in lower margins and the operations reported a pre-tax loss of R27.4 million.

In Southern Africa, wholesale turnover rose 7.7% in what it described as a challenging environment. It said revenue was adversely influenced by the later timing of the Easter holdings, as well a tough consumer market.

Group turnover rose 8.6% to R54.3 billion in the six months to end-March, with close to a third of total turnover generated in foreign currency. Operating profit increased by 5.1% to R1.38 billion and headline earnings per share fell 3.4% to 523.6c. Normalised headline earnings per share increased by 7.5% to 525.9c. It's raised its interim dividend by 5.2% to 284c per share.

It said earnings were adversity affected by finance costs, including big foreign exchange effects on the translation of liabilities to acquire the minority interests in its Irish and Swiss businesses. These costs are excluded from its normalised numbers, which it said reflected its performance.

Its shares ended trade 0.1% up at R198 yesterday.

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