South Africa · Delayed Price · Currency is ZAR · Price in ZAc The SPAR Group Earnings Call Transcripts
Fiscal Year 2026
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Leadership transition is underway with a focus on execution, margin recovery, and operational efficiency. Trading remains competitive, with gradual margin recovery expected as cost initiatives and SAP transformation progress. Share buyback and portfolio simplification are key capital allocation priorities.
Fiscal Year 2025
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Turnover and operating profit grew modestly, with strong cash flow and a 40% debt reduction after strategic exits from Poland and Switzerland. SA and Ireland segments showed resilience, digital platforms scaled rapidly, and a clear path to a 3% SA margin by 2028 is underway.
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A decisive exit from the Swiss business eliminates non-core exposure, reduces group debt by ZAR 3.2 billion, and improves gearing, with a performance-based earn-out retained. Management will now focus on core markets, especially Southern Africa, and expects a clearer path to dividends.
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Profit and margin growth achieved despite weak sales, driven by cost discipline and portfolio simplification. Southern Africa and Ireland delivered resilient results, while Switzerland and U.K. are being divested following impairments. Outlook targets margin expansion and dividend resumption.
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Management is refocusing on core South African operations, reducing debt, and reviewing underperforming European assets. Growth will be driven by new store formats, digital expansion, and private label innovation, with a strong emphasis on supporting independent retailers and restoring profitability.
Fiscal Year 2024
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Turnover rose 4% to ZAR 152.3bn, with operating profit up 15% and net borrowings down ZAR 2bn. Southern Africa and Ireland drove growth, while Poland exit and SAP system fixes are on track. Margin recovery and disciplined capital allocation remain key priorities.
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Turnover rose 7.9% to ZAR 77.2bn, but profit after tax fell 10.2% due to higher finance costs and SAP issues in KZN. Poland exit is on track, with debt restructuring and margin recovery in focus. Group targets 3% SA margin by FY26 and lower CapEx.