Good morning, and welcome to our financial results presentation for the 2023 financial year. By now, you would have become used to of our format. A bit like our strategy, doesn't often change. We stick to our plans. So as usual, I'll do a bit of an overview, then Anton will give you as much disclosure as we possibly can to ensure that you can make informed decisions from the information that we are providing. I will then just give you a little bit of a, of a view of what we currently are busy with. And, then, of course, right at the end, we will do some or take some questions. Shoprite is a very big business. It's large. It has over 3,000 stores, 150,000 people, but yet it's the small things that's important.
So today, we've selected that, I'm talking to you from the 10 Rand truck. That's the truck that we, together with our soup trucks, send out when disaster strikes. When Anton gives his part of the presentation, you will see his backdrop, our Homegrown range. That is a range specifically designed to help our small suppliers, and one of our success stories in there is our Khayelitsha Cookies. I'm extremely proud of the daily dedication of our team across the entire business, and a real sincere thank you to each and every one of you. It's the team, Team Shoprite, that makes the difference. Our people have learned to embrace resilience. Resilience, meaning fix, do something, agility, adapt to the situation, like the solar or COVID, whatever comes our way, and then staying relevant. The launch of Prime, still trying to be innovative.
Our partnership with our world champion, Brad Binder. It's our people that makes a difference. And one can look through these pictures, and you can see from the looting right through to maybe the fun side, that it's only because of the people from Shoprite that has an attitude of, "It can be done." That is what makes the difference for this organization. We have now surpassed the ZAR 200 billion sales milestone, and by quite some margin. It hasn't come just by accident. It, it came by plan, by continuous investment over the long term.
And unfortunately, the negative part of this is that the ZAR 1.3 billion is now very topical, that we had to spend on the, on the diesel to keep our stores open and to make sure our customers get product and still getting good prices, is that that is actually the money that should have gone as a profit increase for our shareholders. The ZAR 200 billion in revenue I just referenced, so the actual number was ZAR 215 billion for the year. But what makes this exceptional is that the additional revenue that that equates to, that we had to add during the year, is ZAR 31 billion. And in ZAR 31 billion is probably as large as some organizations in total.
The gross profit is also an enormously large amount of ZAR 51 billion, and you will remember that in the first six months of the year, we dropped below 24% in our gross profit percentage margin, and in the last six months, have managed to creep a little bit back so that we could end at 24.1% for the year. It is so that globally, all of our retailers has to absorb some of the inflation. The pressure on cost increases from manufacturers and all of the cost factors, especially that we are experiencing in South Africa, has resulted in that we have to protect our customers to some degree, and we've done that.
Very pleasing for me is that we are still able to increase the dividend for the year by 10.5%, illustrative of the ability of the organization to positively generate cash. Very telling is that we are still gaining in customers. Our customer visits are by 13.2%, but as I've always have explained, is that the very telling number is the volume growth. The positive volume growth that we've been able to achieve of 4.9%, which equates to more than 335 million additional items being sold during the past year. Even excluding the Massmart stores, this number is still a positive 3.8% in volume growth. This resulted in a ZAR 8.1 billion gain in market share.
It's the 5th year in a row, financial year in a row, that the group have gained market share, and also now 52 months of uninterrupted market share gains. About six to seven years ago, we very clearly have separated our consumer brands, between the Checkers, Shoprite, Usave brands, with a very clear position. And that balanced portfolio has really proven in good stead for us. If we look at the Checkers brand, ZAR 70 billion in revenue, growing a staggering 18% last year. By far, the highest growth retailer in the premium segment of the market, with a market share currently sitting at 14.8%. And on that point, I'd just like to mention that we do believe there's still a lot of headroom, given that we only at basically 15% market share.
And then, very telling in this whole scenario over the last couple of years is the 10.6 million Xtra Savings customers that we have. The data points, actually, that we have on them, and what makes it really powerful is the fact that the data is so relevant because of the frequency of interaction that customers have with our brand. Primarily because it's food-related, but the data is very current, and that drives our decision-making. And if you look at the wheel on the right-hand side, you can see that our customer value proposition is very clearly defined. I'm not gonna go in each of the detail, but you can understand that we do fit them in each of the blocks that they belong when we execute. Then the Shoprite brand, that still equates to 60% of the South African supermarket revenue at ZAR 90 billion.
That is the big one, growing at, in my view, a very solid 15.6% in the last year, which equates to just under 20% in market share. Here, even more so, the criticalness of having 17.2 million Xtra Savings members, which includes previously excluded data points for cash customers. And again, I just want to reiterate that the Shoprite Group story is not a Checkers story only. We do as much innovation. There is as much creativity going into the Shoprite brand. And if you look at that wheel again, very clear in our customer proposition, it's just different. That's why we have ZAR 5 meals, and that's why we can surprise and delight people with, here behind me, ZAR 1 biscuit, a sweet treat. You almost can't imagine you can still buy something for ZAR 1.
The year that was, was really a telling story of an industry-leading growth for Supermarkets South Africa. I'll get to the inflation graph now, but first, I just wanna mention that Supermarkets South Africa, growing at 17.8% on a very high base, really is a very, very strong result. Without any economic tailwinds, it almost feels like we have to create our own oxygen to mobilize such a growth across the entire business. Hence, again, I want to repeat that it's not only a single brand story, it's a momentum across the entire business. Even excluding the sales from the Massmart acquisition, still a combined growth of 16.2%. Liquor stores had an outstanding result this year, outgrowing the market by 1.3x .
Sixty60 stays a good story, growing 81% on top of 150% last year. Then I, I think it's important that, that the position what the Shoprite Group has always maintained is our value offer to consumers, that we could consistently, throughout the 12 months of the financial year, have been below the official food inflation. That is, meaning our own internal inflation have been below the official food inflation. Customers are really stretching their budgets, so very clearly, over the last two years, we've seen the participation of promotional items in the basket increasing by more than 5%. Clearly, customers are looking for value. Also, so the customers are starting to combine their purchases, and that's why we also have these combination purchases or deals to assist customers to get even better value.
I always say, "Don't underestimate the customer." They are very creative to make their budgets work, and because of our data and our ability, we, we use that to deliver the consumers what they expect from us. As an example, 50% of tuna that we now sell is from our Rite brand private label. Unfortunately, I have to show you this graph. We're not well-known for making excuses. We deal with what comes our way, but 88% of the last financial year, we had rolling blackouts. That now has resulted in that well-publicized ZAR 1.3 billion in diesel costs that we had to incur. I wanna emphasize here that, it's not, it's not us only as the retailer, but it's the entire value chain that gets affected by this.
So really, from farm to fork, it's additional security costs, it's the food waste. You can imagine if any production line is interrupted midway, all of that food production has to be wasted. So it's something really, really critical for the entire country, that we get this thing sorted so that we can get our economy back on track again. And then what's our promise? What is it that Shoprite does? When I talk Shoprite, of course, I include all of the consumer brands, is our unconditional savings for consumers. We don't do double points and special conditions and funny names.
We give instant cash at the checkout, and that, this year, amounted to a staggering ZAR 13.5 billion, and I believe in anyone's language, that's an incredible large amount of discounts, and we're very proud, and we're not shying away from this. The fact that consumers are actually demanding and asking for more promotions on the earlier slide, we're embracing that to entrench our position as the leading value provider for consumers in South Africa. I have mentioned earlier the ten-rand items, so we sold over 150 million under ten-rand products in the last year. And then we have this affordability obsession. We've never shied away from that. So just as an example, since 2016, we have now sold over 600 million five-rand meals and loaves of bread for seven years now with a zero inflation.
I think, quite commendable and appreciated by our consumers. When I spoke about the market share earlier, I thought this picture actually illustrates exactly what I'm trying to say. So firstly, if we look at the ZAR 8.1 billion in the black, you can see it has come from both of the consumer brands, Shoprite and Checkers, so it's not a one-pony story. But I think the graph on the right-hand side clearly shows the multi-year investment, our ability to now start utilizing the tools in which we invested in terms of pricing, whether it's personalization, et cetera, to really meet the needs of the consumers, get our pricing right, and customers are voting with their wallets, and we can clearly see that gap increasing over time.
The rest of the operating segment that we don't talk about that often, including the rest of Africa operations, where we still trade out of nine countries. We still managed to, in the last year, restrict the capital allocation to that segment, and managed to achieve our medium-term guidance that we've gave you before, just missing ZAR 600 million in profit contribution. Very happy that we are still limiting the capital allocation to that, but still achieve a decent number, yeah. On furniture, slightly flat, pretty much in line with what's happening in the industry. What development we have been improving on here is our ability to advance credit, improve the process, easier to apply, quicker turnaround time, and we've seen an uptick in the credit participation.
Although cautiously so, we understand where the credit advancement in South Africa currently is, and how in debt the consumer is. On the other operating segments, I mean, OK Franchise as a division is really becoming meaningful, 535 stores, and also innovation and development on that side of the business. Requests from our members have assisted us into creating another brand that we're trialing in terms of the franchise, and we see constantly a increase in the direct purchases from the group by the franchisees because of the partnership that we are forming with them. Transpharm and MediRite have performed fairly well, double digits. We also there are trialing some more innovation and different formats. So as I mentioned earlier, all parts of the business currently has some form of creativity or innovation.
Now, of course, this is what you've all been waiting for, the detail that Anton is gonna give you around the disclosure, so that you can, as best as you can, perfect your operating model. So I'm gonna hand you over to our very fine CFO, Anton de Bruyn.
Thank you, Pieter, for that introduction and sharing some of the insights into the operational performance of the business for the year. The group delivered a strong financial result, which I will share as part of my part of the presentation. For ease of reference, we've included additional information in the appendix that deals with the adjusted diluted EPS calculation, as well as how we look at our weighted average cost of capital, as well as our return on invested capital. Also included is a detailed analysis of items of a capital nature. My part of the presentation will deal with continued operations. During the financial year, we exited our operations in the DRC, which we now deal with as discontinued operations, and hence, also our restatement of the 2022 financial year results.
During the first half of the year, we concluded on the Massmart transaction. The effective date of the transaction was 9th of January, so as part of the second half results for the year. This number of stores acquired was 94 stores, plus one meat plant in the Gauteng region. If I look at the constituents of which the stores that form part of the transaction, we converted 51 stores to Shoprite, one store to Usave, and then 42 stores to LiquorShop. Two of the liquor stores did not trade at the end of June as a result of the fact that we couldn't get the liquor licenses in time transferred. One of those liquor license has now been transferred, and we also expect the second one to be transferred in the first half of the 2024 financial year.
The purchase consideration that was at fair value was ZAR 662 million. If you looked at what it makes up of, is property, plant, and equipment of ZAR 322 million, inventories of ZAR 367 million, and then also various, employee benefits of ZAR 27 million. The 94 leases, plus the meat plant, made up of the right of use asset of ZAR 784 million, as well as the lease liability of ZAR 784 million. The number of employees transferred as part of the transaction was 4,480, and the sales for the first half for the retail, was very much in line with what we estimated, and that was at ZAR 2.4 billion of sales. If we then turn to the financial highlights, Pieter spoke about the increase in sales.
Total income increased by 15.6%. On a normalized basis, our total income increased by 15.2%, and I will discuss later the items that impacted that. Total expenses increased by 18.6%, and again, excluding some of the abnormal items during the year, our normalized growth would have been 14.9%. What is very pleasing for management is that our total income growth still exceeds that of our expense growth. Trading profit was ZAR 11.9 billion, at a trading margin of 5.5%, representing an increase of 5.7%, and a very strong EBITDA of ZAR 18.8 billion, an increase of 13% year-on-year.
We did realize the exchange rate gain in the current year versus the loss of ZAR 259 million in the previous year, and the gain was as a result of our hedging strategies within the Angolan environment. During the year, the Angolan kwanza devalued by 68.7% against the rand, and more than 93% against the U.S. dollar. Now, as you know, we have those. We've invested in those U.S. dollar linked bonds, and as a result of the currency devaluation, it materialized a profit or a gain in the financial year, which was the majority of that gain. Earnings per share, very strong, 10% increase, with diluted headline earnings per share up 9.7%, and then also our adjusted diluted headline earnings per share up 3.8%.
As I mentioned, there's a detailed analysis of that in the appendix. Our return on invested capital, excluding IFRS 16, was 14.9% versus the prior year's 16.9%, and that was really driven as a result of the additional diesel usage during the year. Our weighted average cost of capital is 13.5%, lower than our 15.1% in the prior year, and that was as a result of how we look at our beta measurement. Our dividend per share increased by 10.5% to a full-year dividend of ZAR 6.63. Our final dividend was ZAR 4.15, which was a 13% increase year-on-year. Our return on equity for the year was 24.8%.
If we then turn to sales, Pieter has spoken a lot about what we've achieved within Shoprite and Usave, as well as in Checkers & Checkers Hyper. Maybe just a shout-out in terms of our Supermarkets RSA business, we saw acceleration of growth during the second half of the year. First half, we achieved a 17.5% sales growth. Second half, accelerated 18.2%, that gave rise to that 17.8% growth in our Supermarkets RSA. Maybe just on LiquorShop, we saw that 30.8% sales growth, driven by 112 stores opened during the financial year, which should include that 40 stores that we saw from the Massmart acquisition, but also pleasingly, is the 61 new stores planned for the 2024 financial year.
The other business units within that Supermarkets RSA business, or segment, contributed ZAR 400 million, and on my next slide, I will give some context of the new store formats that we've rolled out. Supermarkets Non-RSA increased by 16.4% on a like-for-like basis of 16.3%, and internal food inflation, we measure around 6.1%. We've spoken a lot about affordability and also, currency stability that will drive, the growth within that segment. But again, unfortunately, we saw major moves in currency and volatility in, both our Zambia, Ghana, and Angola business units. Furniture increased by 5.1% to ZAR 7 billion.
Majority of that growth is in our Non-RSA segment of our furniture business in the rest of Africa, with muted growth in the South African context, but we've seen an overall muted growth within that sector. We've managed to increase our credit participation to 14.9%, and increase it by 1.5%. Other operating segments increased by 13.3% on the back of a franchise increase of around 13.5%, now trading from 535 stores. And then we also saw our MediRite and Transpharm business increasing sales by 12.2%. We always get a question around the store footprint of the group and the different formats. We've put this slide together to give an indication of the growth that we've seen within the RSA Supermarkets environment.
We've added 301 stores during the period. Again, a lot of growth coming from our core Shoprite and Usave business, where we opened 68 new stores, with the 51 acquisition from Massmart. Checkers also opened 23 stores, and pleasingly for us, is the opening of those four Checkers Foods stores, where we see quite a lot of traction, again, within the suburban areas. Liquor Shop, very strong, 73 stores, opening more than one store a week, and the 40 stores from the Massmart transaction. And then the Petshop business, where we opened 31 stores during the year, already trading from 53 stores. And I know Pieter is chasing, the team extremely hard to reach that first 100 stores within that brand. From another business point of view, we've opened those nine UNIQ clothing stores.
We now have eight Outdoor stores and also nine Little Me stores, totaling 31 additional stores. In total, trading from a Supermarkets RSA point of view, we have 2,121 stores. If we then turn to the income statement, from a total income point of view, we saw an increase of 15.6% to ZAR 56.5 billion. Excluding the impact of the loss of profits claim that we received in terms of the civil unrest, the ZAR 222 million, our normalized total income increased by 15.2% to ZAR 56.3 billion. Our gross profit increased by 14.8% to ZAR 51.7 billion, an increase of ZAR 6.7 billion in the current year.
We did, however, see a decrease in gross margin for the full year from 24.5% to 24.1% on the back of our price investment strategies, as well as an increase, as a result of diesel in our supply chain, where we saw a 25.7% increase in the diesel price. If I then look at other operating income and the ways on how we look to unlock alternative revenue streams within our ecosystem, we saw an increase of 25.4% to ZAR 3.9 billion. Some of the major items contributing to that ZAR 3.9 billion was commissions received within our Money Markets, where we saw a 15.6% increase to ZAR 1.1 billion.
That was on the back of new products launched within our Money M arkets, as well as the increase in payouts for the government grants. We saw a close to 50% increase in delivery GRVs, driven by our more than 80% increase in our Sixty60 on-demand business unit. And then from our Rainmaker Media and insigh t data monetization products, we saw a more than 100% increase to ZAR 383 million. I've spoken about the loss of profit claim, and then from our property portfolio, we saw a 7.1% operating lease income to ZAR 468 million. Interest revenue increased by 22.2% to ZAR 665 million.
If I look at the items that contributed to that interest income, firstly, was the growth that we spoke about in terms of what we've seen within the furniture book, and the interest received on those, on the debtors. And then pleasingly also, we spoke about our Cred X business last year. We now on average have around ZAR 500 million of credit granted to our SMEs and suppliers. That also gave rise to the increase. And then, lastly, is around ZAR 153 million of that interest equates to the investment of around ZAR 1.3 billion in our government bonds, as well as treasury bills in Angola, during the year. Our share of profit of equity and account investments increased by 20.7% to ZAR 251 million.
ZAR 208 million of that is from the Retail Logistics Fund that currently houses our distribution centers and that partnership with Equites. Then ZAR 43 million w as derived through our Pingo business unit, where we have a partnership with RTT on the last mile delivery for our Sixty60 business. From a normalized point of view, total income margin that we see is continuing, is 26.2%. If I then turn to expenses, we saw an 18.6% increase to ZAR 44.6 billion at an expense margin of 20.8%. Some of the major items contributing to the expenses are depreciation and amortization, where we saw an increase of 17.1% to ZAR 6.3 billion. The ratio of depreciation to revenue is still at the 3% target that we set ourselves.
Some of the major drivers was 18.5% increase on our depreciation on property, plant, and equipment, as well as a result of that strong store opening program, as well as the depreciation on some of the IT projects that we've delivered that forms part of our intangible assets. We also saw a 15.2% increase in our right of use asset depreciation on the back of those additional leases, pertaining to the store opening program. Employee benefits increased by 15.3% to ZAR 17 billion. During the second half of last year, the group launched our Shoprite Employee Trust Scheme. We expensed ZAR 235 million in the current year versus the ZAR 128 million in the prior year. That led to an additional ZAR 107 million.
If we exclude ZAR 107 million, our growth was 14.6%. And then another anomaly that formed part of employee benefits during the current year was the ZAR 193 million included in the 2022 result as a result of that civil unrest, that was a once off. If we therefore have to exclude those two anomalies, our core growth within our employee benefits would have equated to around 13.1%. That growth was driven by the 8,131 new job opportunities created. ZAR 285 million of that growth relates to the Massmart transaction, where we added those 4,480 new staff members.
We also contributed ZAR 91 million to the government's in support of the government's youth employment scheme, where we have currently more than 2,000 participants in that program. Electricity and water increased by 36.6% to ZAR 4.9 billion. Pieter has spoken and has shown the graph on the additional diesel spend of that ZAR 1.3 billion. In the prior year, we did spend ZAR 200 million, and that's why we referred to that ZAR 1.1 billion as additional spend in the current year. Excluding the impact of that additional diesel spend, we expected our electricity and water to increase by 6.1%. Other operating expenses increased by 18% to ZAR 16.3 billion.
Some of the main drivers was, firstly, that, increase in our insurance costs, where we had to source additional insurance, giving rise to the civil unrest. We could not cover ourselves through Sasria or get fully covered through our Sasria offering in the current year, hence, the fact that we had to source additional insurance for that, and that came at a massive cost of ZAR 181 million. We also saw a 15.2% increase, within the advertising spend to around ZAR 3.7 billion for the year, which was largely, as a result of the strong sales growth that we achieved within the financial year. Our security costs increased by 12.5%.
We look at protecting our assets and in terms of loss prevention, but if we look at our historical rates, we've kept on spending around 1% increase in maintenance costs to around ZAR 2.5 billion, and that was also on the back of the load shedding that we experienced. If we therefore exclude some of these anomalies or abnormalities, our expense margin would have been 20.1%. We then turn to trading profit. Supermarkets RSA, we saw an increase of 5.6% to ZAR 10.8 billion. Still a very strong trading margin of 6.2% diesel expenditure. Supermarkets, non-RSA, very strong performance with a growth of 24% to ZAR 594 million.
Two reasons for that is, first, our investment in gross margin to stimulate sales within the South African context, and then we also had to supported by the growth in our franchise business, where we saw a 5.6% growth in profitability. Our MediRite and Transpharm business contributing very well, and then also our Computicket business, where we've seen an increase in traveling and entertainment again. Our trading margin for the year was 5.5%, and just for comparability, if we had to exclude the additional diesel expenditure, we would have achieved, again, that 6.1% trading margin that we've seen in the past few past years that we achieved.
Our net finance cost increased by 18% to ZAR 3.2 billion, on the back of a 350 basis point increase in interest rates during the year. What was very pleasing is that the increase in our interest received was in line with what we could also see in our borrowings, and that was at 67% increase. Our borrowings during the year did increase by ZAR 856 million, and our average cost of funding in terms of our borrowings is 7.9%. If we then look at lease liabilities and the finance charges related to that, we saw an increase of 16.3% to ZAR 3 billion.
That's on the back of the increase of around 15.2% in our lease liabilities, and our average cost of funding related to our lease liabilities is around 8.9%. We then turn to the balance sheet, mention the increase in our borrowings to ZAR 6.4 billion. Our borrowings to equity ratio is at 24.2%. Historically, we gave that target range of 25%-30%, but I think in the current interest rate environment, now, now is not the time to increase our borrowings, and that's why we also spend quite a amount of time looking at our capital allocation model, as well as the capital that we invest back into the business.
U.S. dollar borrowings decreased from $43 million to $29 million, and it's now at around 8.5% of our total borrowings. We saw a ZAR 3.1 billion increase in our right of use asset and a ZAR 4 billion increase in our lease liability on the back of the aggressive store opening program, and then a positive move within our net working capital. I will unpack inventory in the next slide. We saw a positive move of 10.5% in our net cash, and we ended the year on ZAR 6.6 billion. But one has to take into account, when looking at our net cash, is that we did settle ZAR 630 million relating to the Massmart transaction already as part of the financial year.
And then, as I mentioned, if we look at the Cred X business, where we on average lend around ZAR 500 million, we would have actually achieved a much better performance within our net cash for the year. Looking at our capital expenditure, our capital spend as a percentage of sales was 3.1%. Excluding the impact of initial capital we spent relating to the Massmart stores, as well as the replacement capital that we spent in terms of the social unrest, our target of 3% was achieved. That equates to around ZAR 6.7 billion in capital or 25.5% increase. How we always look at our capital expenditure. How much do we actually allocate to expanding the business versus maintaining the business?
Again, this year was no exception, where we spent ZAR 3.8 billion on expanding the business purely through sales growth, and then also our digital acceleration, where we spent ZAR 458 million. It's critical for us to also maintain our stores and to remain relevant, and there we spent an additional ZAR 1.85 billion, and on our IT infrastructure as well, an additional ZAR 190 million. An additional measure that I decided to introduce or share with the market as well, is that we must understand that not all capital that we spend in the current year, we will also realize the benefit during that year.
So 71% of the capital that we spent in the current year, we also realize the benefits, and that will be through the opening of stores or the launching of new money market items or products. But what is important to note is that a third of the CapEx that we spend in the current year will only give us benefits and improve our shareholder returns in years to come. The Shoprite supply chain is a critical part of the success of our business, and with the aggressive store opening program that we've had over the last few years, and if I also look at the next year, it was important for us to invest additional capital in also expanding our distribution space.
So that's why I'm giving you already some of the insights into what we will spend in the current year in terms of our distribution space, as well as the next financial year. So already now in October, we're taking live our additional space of around 38,000 square meters in Natal. That is funded through our retail logistics fund, where we have that partnership with Equites. The capital that will be funded through Shoprite will be ZAR 200 million, and we estimate that the additional inventory that we will report on in the first half of the 2024 financial year will be an additional ZAR 300 million. We're also investing in our Centurion transport facility, an additional 7,000 or close to 8,000 square meters, where we will fund an additional ZAR 75 million.
The CapEx to actually develop those sites will then obviously go through the retail logistics fund. If we then look at 2025, through Equites Property Fund, we will take on stream a close to 94,000 square meter distribution center in Gauteng. Shoprite, again, will fund close to ZAR 700 million, and we estimate that the inventory build will also be around ZAR 700 million. What is important to note is that although we will only start training and moving stock from that DC in the 2025 financial year, we will already start GRV-ing and taking in stock, which will have an impact on our inventory levels for the full financial year.
We're also taking live the Wells Estate in the Eastern Cape, where we currently do not have property or distribution space of this size, where we will fund ourselves around ZAR 630 million. And we also estimate that we will see an inventory build of around ZAR 600 million. That development will also take part through the Retail Logistics Fund. So over the next two financial years, we look at adding around ZAR 1.6 billion in inventory, which I will also share on the next slide. If I then turn to inventory, we saw a 14.7% increase of our inventory to ZAR 25.1 billion, it's a move of around ZAR 3.2 billion.
Majority of that stock was in the Supermarkets RSA segment, where we saw an increase from ZAR 17.2 billion to ZAR 20.3 billion. As you can see, the other segments very much stayed in line with the prior year. We are very happy with the result around our inventory to sales ratio, where we actually saw improvement from the 2022 result to the 2023 year. Supermarkets RSA is the main driver, where we saw an 11 points and a consistency around that 11.7%. We did see an improvement in supermarkets non-RSA, but that was really driven as a result of currency volatility. If we had to exclude the impact of our distribution centers and only look at the stock holding within our stores, we saw an improvement from 9.3% to 8.4%.
Within the supermarkets RSA environment, we actually—what we could see is that majority of our stock holding and acquisition, we did not do any buybacks in the 2023 financial year. And if I look at the additional CapEx that we will spend in the 2024 financial year and the additional exposure around diesel, I cannot see us doing any share buybacks also in the 2024 financial year. Talking about the CapEx, I've spoken about the investment in supply chain. We also plan to upgrade the 94 stores that we acquired from the Massmart business and during the 2024 financial year. And then we still plan to open an additional 314 stores during the financial year. All of that equates to around additional CapEx spend for the year of ZAR 8.5 billion.
If I exclude the Massmart upgrade as well as the investment in supply chain, we get back to that 3% target range that we've set ourselves internally. Currency stability and affordability remains the driving force within the non-RSA segment, and it becomes very difficult to estimate the profitability of this segment. We do expect a lower interest earned from our investment in our government bonds, purely on the back of devaluing Angolan currency against the rand. And that's why we're not changing our medium-term trading profit guidance of around ZAR 500 million-ZAR 600 million on that segment. The group plans to open 314 additional stores during the 2024 financial year, as well as 98 of our franchise stores.
Inventory for the full year, we estimate to be around 12% of sales, based on the inventory build in the new distribution centers, as well as maintaining our high in-stock levels for our customer availability. Thank you, Pieter. That is then the full financial presentation, and over to you around the strategy of the group.
Thank you, Anton. I sincerely hope that those disclosures that he's just done will assist you in making better-informed investment decisions. Just again, a reminder of what it is we stand for and why. The Shoprite purpose, defined as uplifting lives every day, and that's across the entire spectrum. No exclusions. Of late, we are very conscious that we also need to protect the planet in all of this that we do. You've become familiar also with our nine strategic priorities that guides our daily decision making. We're not known for making knee-jerk reactions. We have embarked on a strategy six, seven years ago, and we are still pretty much exactly on that journey. Mainly in three buckets: the smarter Shoprite, the headroom that we have, where we target additional opportunities, and then we wanna win in the long run.
And it's the combination of this that is delivering the results that we see today. So in the smarter Shoprite, very quickly, a truly customer-first focus, easily said, hard to execute. Very hard. But every day, that is what we drive. We have our own adage, and everybody in the company lives up to that. Creating future-fit channels, and the challenge these days is to recruit and retain the talent required to support those channels. That's why it's become a very strategic driver for us. And precision retailing, I've been talking about for years, and I think I said last time also, people frowned upon that, and now it's being used often. We've invested heavily into enabling precision retail. I have mentioned earlier about the customer data.
Let me just clarify, the customer data is around their buying behavior and the products that they do and their price sensitivity, so not about their personal data. We of course are very protective of that. Then the opportunities that we see, we have to double down, and I have something later on also about the private labels. Just purely because the sheer volume requirement that the group has on a daily basis, especially on when we're on promotion, now necessitates us to double down actually on investment on our private labels. Fresh food, our growth in the premium fresh food market has accelerated. I'll share that number with you now. And partnerships is very important to us. At the speed that it is required to grow and keep on growing in today's world, we can't do everything ourselves.
We will just be too slow. So we are very cherishing our partnerships in-store as well as externally. And then win in long run, you will notice the other income line on the income statement is now just hitting ZAR 4 billion, growing at 25%, and we have mentioned to you three or four years ago that in time to come, it will become more and more meaningful, although still today, it is, it's not really moving the dial in totality, but it is contributing and more so. Force for good, I mentioned. For us, it's not a tick anymore. I'll cover 2 or 3 points just on that to illustrate what we do, but it has now come onto the forefront of one of our strategic drivers. And then, of course, we leverage our platform. It's in our flywheel.
It will be my last slide. You're very familiar with that, that everything hangs from our core retail business. So yes, it's been a busy year. It's been very busy, but it's not true that we are so busy that we are getting distracted of what it is that we need to deliver on. I'm not gonna read all of them. I'd like to point out the Rex platform. Fantastic for us is that we don't have to guess anymore. When we sit with our suppliers, manufacturers, partners, we don't have to guess about what is right and what-- which data is correct. We're all working from the same source, and it's very current and relevant, and it really speeds up our decision-making and making sure that we're all aligned in terms of what we want to deliver.
I can point out the Sixty60 service guarantee. Yes, we are doing well, but that doesn't mean we stop innovating and improving. So we are putting our money where our mouth is. I have to call this out. In this environment, we have created over 8,000 new jobs. Very pleasing result, very happy about that, that we could make a difference in so many lives. And a personal pride of mine is the fact that our employee trust have been able to distribute over ZAR 250 million to our employees as part of their reward of delivering fantastic results. We also created Cred X, that, in particular, is how, where we advance credit to our suppliers for bridging finance. Also part of the small supplier development program. And overall, we have managed to open 382 stores for the year.
Not entirely what we wanted. We wanted 425, but these days there are obstacles like electricity connections and sewage and water, that is hampering the speed at which we do this. But for the new year, we're still planning to open 314 stores. The money market bank account required quite a bit of investment. It's complicated, it was expensive, but it's finally bedded down, and we're seeing very good traction on that. Basically, the only transaction-free bank account in the country, apart from when you withdraw cap money. That's the only time that there's a charge. And towards the end of June, we have delivered or soft launched on our subscription model on the Sixty60. As you know, even when the business does well, it also requires even more investment because we believe it can do even better.
The smarter Shoprite, this is just very quickly, in a nutshell, is maybe a, a repeat of a lot of things that I've already said, but if you just look at the sheer size of all of the transactions and the involvement, we have 415 million financial transactions, over 3,000 stores. Sixty60 now operates from over 400 stores, and possibly for me, the most critical of why I'm showing you this, is that 27.8 million Xtra Savings members. The pure fact that their usage rate is, by quite a margin, bigger or more than what the national, international standard is, is quite telling. You can see there, almost 2,500 swipes a minute. That keeps the data current in terms of how people buy and what substitution they do, and what categories they are leaving.
We share all of that data with our suppliers, and that just helps us all to make quicker and better decisions. Sixty60, our online one-hour grocery delivery business, I mean, a success story by itself. I did mention 80% growth on top of 150% last year. That graph has just continued to grow. Most people thought that somewhere we're gonna fall off a cliff, but it's absolutely not what is happening. And again, fantastic story to say that over 9,000 new job opportunities being created since the launch of this service. As I said, we don't stop. We keep on innovating. And basically, it was a soft launch. This is a subscription model, ZAR 99, unlimited deliveries.
The official launch is next week, and we have decided, each in a week's time, that we will give you a preview of what our launch commercial would look like.
Hello, South Africa. Checkers has done the impossible. Unlimited Sixty60 deliveries are here! With the new Xtra Savings Plus subscription. Get whatever you want, whenever you want, as often as you want it. For just ZAR 99 per month, you get unlimited Sixty60 deliveries for free, plus an extra 10% off one in-store shop every month. Unlimited Sixty60 with all the pluses. It's possible. The world's most famous actor telling you about it. Well... Who's signing up with me?
So you have become accustomed to a very creative Shoprite X and Sixty60 team, and I hope you enjoyed that, and so with the consumers. We do believe it is a, it's a compelling offer, that will just, again, put us ahead of what's currently in the market. The private labels I've mentioned, and in previous presentations, I have explained that we have a slightly different view on private labels than what I believe most of our competitors have, is that we always try to fill a specific need state, and not just more of the same. But there's one thing about, our private labels that stands out, is the loyalty factor that it also creates. So you can see there, 96% of all our consumers actually buys at least one of our private labels. This is an illustration of that. The contribution.
Slowly, we've been tracking that slowly up. Six years ago, we were at 13%. We're now at, let's call it 21%. But we don't make a specific set target for that. We will address it as the needs data rise, and as our data is telling us where are the gaps in the market exists. What has been very successful is the premiumization of our private labels. In that, examples would be what you probably familiar with, is Simple Truth and Forage and Feast. And what is quite telling of this is that there was a clear gap in the market from local manufacturers and even multinationals, that we had 7 premium labels in the Checkers brand that achieved almost 30% in sales growth in the last year. LiquorShop also pointed out, growing at 1.3x the market.
We've opened our 700th store, and we're not stopping. We certainly are continuing to grow that business. That team averages about one new store a week, and we hope that they can maintain that momentum. Then here's what I mentioned about the, the market share gains in the fresh food part of the business. Out of the ZAR 8.1 billion in market share gains in the last year, ZAR 2.3 billion came out of fresh foods, and we're gonna continue to push in this section of the market. We've got 87 Fresh X stores now. They're expensive, I know that the cold chain is not compromised. It's, it's something we take very, very seriously.
That there's currently no economic growth in South Africa doesn't mean we can stop investing, because if you stop investing, to start again in the future is a slow start. So we keep on investing. Our supply chain, we've mentioned before, we're adding 200,000 square meters to the supply chain. And believe me or not, but in one of the regions, we are already out of capacity just because of the exceptional growth that region has achieved in the last two years or so. So we are planning again, next round also. I mean, we are leveraging on our proximity advantage. What we mean by that is, having this very wide network of stores allows us to also experiment with some other concepts, like you've seen the Little Me, Outdoor, MediRite Plus, et cetera.
We have been doubling down on our digital investment to maximize our share of wallet. Having that 27 million Xtra Savings customers, we just so much better understand what else it is that we can offer them to either save them money, save them time, increase their quality of life. I did mention Force for Good. Force for Good is not just a tick in the Shoprite Group. We do an enormous amount for our communities. I like to say that big business can make big differences, and this is exactly what we do. There are big numbers on there. I'm not gonna read all of them, but we are supporting not only on food, but also in community development, our early childhood development centers, the food that we donate, and not to forget or underestimate the large amounts of recycling that we do.
We also do compost, and so we really feel that Shoprite is a responsible citizen, corporate citizen, in doing our part when it gets to the planet. We'd like to leave the planet a better place than what we found it. I know you're very familiar with this flywheel of ours, where at the center of everything we do is our core supermarket business, and then we build around this, all these adjacencies, in order for us to deliver on what our customers really expect from us in terms of saving them money, improving their lives, and giving them the things that they want, not what we want. Thanks for listening. Appreciate that. I'm gonna move over to Anton so that we can take some questions now, and during that time, we will show you just a few comments from our most important stakeholder, which is our customer.
Thank you. Okay, so I've made it to Anton. Very quickly, while he gets us the questions, the obvious, that guidance that or some input you would like from our side is, how has the new financial year started? So yes, we have mentioned in this morning's session also, it still remains in double digits. We have to remember that in January we peaked inflation at about—food inflation, about 12.1%, and it's come down to 8.6%. So, that by itself would mean a slight reduction in, from a percentage growth point of view. But double digits is still very good in terms of rest of market. We must also not forget, so that we, we're up against a very high base.
If you look at the entire financial year, last year, I mean, at 18%, then the base is very, very high. So for us to maintain that high level of growth is gonna take maybe more than one horse. I think you will ask... There will be some questions around Massmart. I will deal with that as they come. The diesel cost is still increasing on last year, so the expense increase on last year is in the region of ZAR 60 million for the two months. We are analyzing that high peak in the additional load shedding in September. And yes, we will continue to invest in on behalf of our customers. We have to.
We all have seen in the last week also, the levels of debt default. It is so that our consumer is distressed at the moment, and we must do everything we can to support them, and we will continue to invest in price and value. And we have seen, during the presentation, I've mentioned the increase in promotionals spend by customers. We will continue to do that. It is so that globally, assist the customer, as all of the cost pressures could not be passed on to the consumers. So, yeah, Anton, we can maybe then on that?
Yeah, maybe that's a good starting point. I mean, there's quite a few questions coming through on gross margin, and how do you think about gross margin going forward? Is it peaking? Is it something that you... You talked about price investment. Maybe just share how we think about gross margin.
Yeah, we don't give guidance on gross margin, because so many factors actually influences that. We must remember that gross margin is just purely the cost versus sell price. It is influenced by supply chain costs, the diesel we just spoken about. There's a number of factors that actually affects the gross margin. We... I did sort of allude to the fact that the 24% is where we got back to, 24.1%. But I cannot absolutely say that we will achieve that. It all depends on what gets thrown to us. I would love to give guidance, but then it's like, if you can tell me what's gonna be thrown at us tomorrow, then I can maybe tell you what the GP will be tomorrow.
Absolutely.
So there are so many variables, and currently, I mean, to tomorrow, we're gonna have a ZAR 2.80 diesel increase in price. That immediately affects the gross margin. So, suffice to say that we had a president of the Spanish Retail Association here, and he showed us the range of margins currently achieved by food retailers globally. And you're talking about between 0.7% and 2.9%, and Shoprite's RSA supermarket sitting at 6.1 s o.
A strong trading margin. Pieter, you spoke about, in the presentation, about a multi-year transformation, and I think for our overseas investors or new investors to Shoprite, maybe just share with us what you've seen during the last five, six years, as since you've become the CEO, what are our strategies? I mean, you spoke about our strategies, but maybe just give some of the highlights, has given basically a rise to the profit and what's driving the sales growth.
The transformation, not purely the investment?
Yeah, yeah. How about both?
By people.
Yeah.
So it all starts with people. I say we're in the people business, very simple. There are our customers are the people, then there are us, the Shoprite people... and they also are our shareholders, they are the people. So we're in the people business, we're a customer-facing business, very different to being a manufacturer. So it's the people first. And we've done many changes, and something like the employee trust, the fact that we pay above the national minimum wage levels, and for critical positions, differentiation, and so forth. So all around that, very critical, important. And then there was the financial investments, the CapEx that we invested. And pretty much on here, I mean, first it was the foundation that we had to put for the core system of record, SAP.
You know, there are not many good stories about first-time around implementations. We managed to bed that down first, and that formed the basis of a lot of this investments. The Xtra Savings have made a big difference. The form of Shoprite X, you've seen their creativity, the stuff that they do. With that, the data, and out of that flows the personalization, and now being able to share the data with our manufacturers and suppliers through the Rex platform. The re-platforming of the financial services sector or segment. So a lot of CapEx investment through COVID to lay this foundation for us for, as we said, winning in the long run. So these are all investments made. Not all, but a lot of the investments here are made for future growth.
Yeah. I think maybe just to add to that, there's one or two questions about our income margin. So I mean, with all these investments, we're looking at maintaining that 26% income margin. This year was an anomaly in terms of expenses. Our expense margin normally runs around 20.1%, and that's how we derive that 6.1% trading margin. So excluding the impact of the diesel, like we said, our trading margin would remain around 6%. So going forward, if we had to give any guidance, I mean, I said our core income margin, we, we still estimate around 26%, and then depending on what we will see within the diesel usage, that will determine obviously then how we look at our trading margin going forward. Pieter, lots of questions around Massmart.
So are you happy with the first half or the first half of Massmart in our base, the performance there, and how do you think around the future of Massmart? I mean, we're making additional investment in terms of capital around refurbishing those stores. So maybe just share a little bit about how you think about Massmart, the stores that we've incorporated.
I'll start with my disappointment in the fact that to get this over the line took almost one and a half years.
Now, in that one and a half years, we can understand a lot of damage was done to the equity of those sites and stores in particular. No investment, lack of stock, and a lot of suppliers, or small security people, merchandise, et cetera, lost their jobs, et cetera, which I'm very annoyed by. But we have taken it now, and there was a lot of, as I said, damage done to the equity of those stores. So we had to rebuild. Firstly, a great thank you to the fantastic effort by the Shoprite team to. On the 9th of January, when everybody was on holiday, when we took over those stores, the next day, they were all rebranded, done, painted, so and open and ready for trade. So now we have to invest.
The stock has started to flow in, and we have to build that equity back, back. So we're not right at the level where we expected to start, so we started at a lower base, but we're almost there. We guided that we were gonna be at breakeven by now at the financial year end. On EBITDA level, we're just under breakeven level.
Some of the stores are performing very well, and some are, of course, still loss-making. It goes without saying. We have to get them up to our standard, so that's why you mentioned the CapEx that we have to invest. Overall, those stores have incorporated very seamlessly within the Shoprite structures. And, for us today, there's no difference between them and the rest, and slowly but surely, we are picking up the performance in them, and I am sure in the next year, they'll be where we want them to be.
Okay, great. Thank you very much. You spoke about private label, and there's a question around, from Chris Gilmour, around the manufacturing capacity. And how do you look at manufacturing capacity, and how do you actually stimulate the manufacturing capacity within the South African environment to actually grow our private label participation and, and products?
So firstly, I just wanna put in context, it's one thing to look at percentages. So you can look at our private label participation as a percentage, roughly 21%. But if you do it in value, 21% on ZAR 215 billion is ZAR 45 billion. That's bigger than some other retail businesses in the country. So it is big by itself already. Secondly, and I've been saying this now for more than five, six, seven years, is that there is a lack of investment in manufacturing capacity in the South African environment for various reasons.
It can be the macro environment, it can be the lack of incentives to invest. Whatever the reasons are, there has not been many manufacturers that expanded in capacity, and now we have this added complexity of the load shedding and interruption that that has on manufacturing, and be able to provide the volumes that we require. So hence, we had to start help investing in capacity build with some of our own suppliers, or suppliers that already supply to us.
And we will definitely, in this year, have to increase on that, because of the sheer volume, which I did mention, that we require, especially when we go on promotion, is to get the right service levels for us, to not disappoint a customer. That is what we're about, is that we don't want the consumer to spend that money, the extra ZAR 2.80 from tomorrow a liter on petrol, on a taxi fee, ZAR 50 a single trip, and then we disappoint them because we didn't get the product. So that is what we're trying to address, is the customer's right to when they've elected to come to us, to actually get what they came for.
I think additional to that, just, Pieter, is also how we look at, obviously, our Next Capital . I mean, Next Capital obviously just don't do working capital financing, but we've also started investing actually, and giving funding to kickstart businesses. There was a question just around Sixty60. I mean, just where it doesn't roll up. So Sixty60 sales forms part of our Checkers, and Checkers Hyper sales, which forms part of the RSA Supermarkets business.
So the GP, everything just rolls through as part of that reporting, and then the delivery recovery is the ZAR 35 delivery fee that we charge to our customers, which rolls up under delivery recoveries, which I mentioned. Pieter, the furniture segment, we saw a decline in profits. There was just a question around: How do you look at this going forward, and how does it fit actually into the Shoprite business and environment?
Okay, so immediately, three things come to mind. The one is, up to now, it's been primarily a cash business. If I take where we come from last year, the shipping cost of a kettle, per kettle, amounted to about ZAR 52, now we're at ZAR 7. So the pressure on the gross margin has been incredible in the last year. Affordability for consumers in that what is not a necessity, it is, can we say, not luxury, but... I mean, it's not like food, you can maybe still cook water on the stove and not a kettle, but y ou understand what I'm saying i s that the cost drivers have changed for the better for the consumer.
The credit that, I think over time, we have not invested enough in that. And then thirdly, that brings me to the main point, basically, is that even though you've analyzed the entire ZAR 8.5 billion we're gonna spend in the next year, that still comes in a priority list.
So it is unfortunately this long multi-year investments that we have done, that furniture was put on the lower end of that investment. What have we done right now, or what are we busy with now? We've made some changes and boosted in terms of our whole management structure, how we, how we operate. Secondly, there was a complete revisit in terms of our assortment, what styles we do. So there are a lot of global trends and so that we will, we will, be introducing now, from now to the end of the year, and the increase in the credit participation. So I think a little bit more of attention that they deserve. Yeah, I expect them to deliver back to where we were.
Yeah. Thank you. Maybe just on the CapEx, I mean, there's been a few questions around the 8.5, and what impact it will have on our return on invested capital. I think, what complicates things is obviously the impact of the diesel. So if we had to exclude the diesel, at the 16.9% we achieved in the previous year, our results would have been much more in line also with achieving that 16.9%. So basically at a 2% move on ROIC, purely as a result of the diesel impact. If I look at the impact from a capital spend point of view, I did mention that our depreciation is still around 3% of our sales ratio, so that's additional spend will not have a material impact on that, and that's basically our North Star, basically, on how we spend our capital.
Looking post 2024, we will have additional capital expenditure again, so it will be higher than that 3%, purely on the back of the distribution center expansion, but that is necessary for us to supply our store growth. So yeah, I mean, that's how we look at it. Pieter, maybe just one or two last questions around UNIQ clothing. So we obviously launched UNIQ during the year. I mean, are you happy with the performance? I know it's very small, I mean, it's nine stores, but I think people just wanna know, is it contributing? What, how do you feel about it?
It's one of those things that I mean, if you look at this. It's a long-term play. I mean, it's not gonna move the dial in the next year or 2, but we're learning a lot. It's exciting. We sold out mostly. Good news is that the summer range has arrived. We start merchandising from Friday, and then the stock will be available throughout. 10th store is opening in Rosebank now. So yeah, unfortunately, or fortunately, whichever way, you can only invest in by season. Y ou can't open stores midway. Where are you gonna get the stock and the styles and that? So it's got its own rhythm as the seasons go. I know... Remember, we're not in fashion. It's fulfilling the basic, the start of your dress code, and then you go to the high fashion to round yourself off. So no, it's doing well.
Okay. I'm gonna try and see that we finish around 11 o'clock. So maybe two more questions. Just one is, now that we're seeing inflation, basically, we're seeing a retraction on inflation, how do you think around volumes, volume growth, and how that will trigger, additional volume growth within the business?
Again, separate the two consumer brands, Checkers and Shoprite, Usave. We must remember that two things is very critical here when we talk inflation and volume, is that your restricted budget persons, a budget doesn't change or ability change because there's inflation. If I'm on a ZAR 350 grant, it stays ZAR 350. Which means if there's inflation, I have to buy less items. That's why you will see in the confined budget portion of the market that you will see a reduction in volume. I have no choice.
Whereas at the higher end of the market, you've got a more flexible change from brand or category or size, product size, et cetera. So that's just the balance that from our manufacturers and load shedding, et cetera, et cetera. And then in some categories, we must understand that we over-index quite substantially i n terms of the market share on that, which brings its own challenges by itself. But I still believe that we could, in the balanced portfolio, still manage a volume increase in the year.
Thank you. I think the last question, and that is basically maybe from a positive point of view: How do you think around market share? I mean, obviously, we've gained market share now for quite a few years. So how do you see that going forward?
Yeah, I still believe there's a lot of room here. I mean, finally, I think what's illustrative of the ability that we could still gain market share is that our audience have started to understand that we must look at it separate from the two consumer brands. So at a sub-15% market share in the Checkers brand, I cannot for the life of me think that that's where we're gonna stop sub-20% for the Shoprite brand, with its strength and its penetration in the market in a very tough time when our price and value proposition is so clear and well understood, and the levels of in-stock that we are achieving do not disappoint consumers, so that you don't have to, which you can't afford to do, is shop around because the retailer that you've selected is out of stock.
So the combination of that must leave me positive that we have headroom to gain further market share.
Thank you, Pieter. I mean, the questions that we haven't answered, we will answer between Tash and myself, we will answer. But maybe just closing comments, and then you can say goodbye.
Well, I'll thank you for your attendance. I hope we have given you clarity on certainly how clear we are on what we have to do. But it would be amiss for me to once again thank you, the people of Shoprite, team Shoprite, with their dedication every day. You wouldn't understand how incredible this is unless you're on the inside. It's something very difficult to know if you just look from the outside. And we're not only about the numbers, we are definitely about the people. So thank you.
Thank you, Pieter. Thank you very much.