Shoprite’s diesel costs increased by R560 million due to loadshedding

Shoprite’s diesel costs increased by R560 million due to loadshedding

During the six-month period ending in January 2023, Shoprite spent R560 million on diesel to power generators at its local supermarkets so they could remain open during loadshedding stages five and six.

The Shoprite company said this week that its half-year total product sales grew by 17% to R106,3 billion.

During the half year ended January 1, 2023, Shoprite’s South African supermarkets generated 80.1% of its sales and recorded 17.5% sales increase compared to the half year ended January 2, 2022.

“The increase in sales reflects a record Black Friday and holiday season, underpinning 46 consecutive months of market share gains,” Shoprite stated.

As a result of Shoprite’s product mix exposure to commodities, the company’s internal selling price inflation during the first half of the year grew by 9.4%, but external selling price inflation was significantly greater.

Excluding the locations it bought from Massmart and social unrest-related store closures and re-openings, Shoprite reported that South African supermarkets grew by 191 net stores to 1,953 in 2022.

During the first half of the year, the rand-based sales of Shoprite’s supermarkets outside of South Africa climbed by 17.5%, and these stores provided 9.4% of the group’s sales. Last year, Shoprite closed all three locations in the Democratic Republic of the Congo and left the nation.

The number of international supermarkets decreased by five net outlets to 227 over the past year.

During the first half of the fiscal year, the company reported receiving an insurance claim for a profit loss of approximately R245 million.

However, Shoprite stated that the receipt would be offset by the R90 million increase in insurance expenses incurred during this period as a result of the group’s choice to purchase additional insurance coverage beyond what the South African Special Risk Insurance Association provided.

Shoprite stated that it had rebranded and merged the Massmart stores and businesses into its South African supermarket operations. 82 former Massmart locations are now Shoprite and Shoprite Liquor stores.

The Massmart purchase became effective on January 9.

»Shoprite’s diesel costs increased by R560 million due to loadshedding«

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