Johannesburg- Retail giant Pick n Pay this morning said it lost nearly R1 billion in lost sales during the July civil unrests that swept through the economic hubs of Gauteng and KwaZulu Natal.
This is as the group reported its results for the 26 weeks ended August.
Pick n Pay was forced to close 551 stores to protect staff and customers at the height of the unrests which also saw two of its largest distribution centres in KwaZulu-Natal looted of all stock.
The company also said government’s liquor restrictions resulted in an estimated R800 million in lost sales during the reporting period. Despite these challenges, the Group recorded sales growth of 4.1% over the period, to R46 billion.
However, the group’s gross profit decreased 3.4% to R8.4 billion, with the gross profit margin lower at 18.2% of turnover.
Despite the tough trading conditions, the retailer still recorded growth on a year-on year comparative basis, after profit before tax rose 86.3% year-on-year.
Pick n Pay CEO Pieter Boone said the group’s result reflected strong performances by its Boxer and Clothing businesses, pleasing momentum in omnichannel, and effective management of working capital and capital investment.
“I am exceptionally proud of our Pick n Pay and Boxer teams for their leadership in very difficult and unforeseen circumstances. The way you responded to the horrific events in July was inspiring. It confirms again that Pick n Pay and Boxer are great organisations, with great people at their heart. Winning through people remains at the heart of my strategy. Our sales were badly affected by the civil unrest, and also by the government’s liquor restrictions. I am encouraged that – once you normalise our performance to strip out these effects – we maintained our underlying positive momentum across the Group,” he said.
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