SPAR records massive R5 billion loss as it quits international businesses
SPAR has recorded an over R5 billion loss amid the sale of its Swiss and English businesses, despite positive signs in South Africa.
In its latest financial results for the year ended 26 September, SPAR recorded a profit of R1.1 billion from its continuing operations.
However, the group’s discontinued operations, which include its Swiss and English businesses, recorded a loss of R6.1 billion.
During the period, the group stated that it had concluded its European strategic exits and continued to make progress on the disposal of AWG in South-West England.
The group sold SPAR Switzerland for a total equity value of CHF 46.5 million (approximately R1,025 million) in September.
The group is entitled to further earn-out payments of up to CHF 30 million (about R660 million) if EBITDA targets are met by 2027.
However, the sale resulted in a cash outflow of CHF 31 million (approximately R683 million) for the South African retailers, including CHF 11.5 million (approximately R250 million) to the Swiss Competition Commission.
The sale follows the group also exiting its Polish business for R185 million, but it still had to pay R2.7 billion to recapitalise the Polish unit.
During the period, the group also assessed the carrying value of certain assets. This resulted in impairments of corporate stores’ goodwill right-of-use assets in Southern Africa.
There were also impairment charges related to SPAR Switzerland and AWG.
The group stated that these actions were deliberate steps to ensure that the carrying values of assets align with their cash-generating potential and market conditions.
It said that this provides a clearer earnings base, a more representative balance sheet and improved capital structure visibility going forward.
The group stated that its net debt had reduced to R5.4 billion (FY24: R9.1 billion), primarily due to the exits in Switzerland and Poland.
However, examining the group’s income statement reveals a significant shift, from a profit of R158 million in FY24 to a loss of R5.1 billion.
The group’s earnings per share fell from 182.7 cents in FY24 to a loss per share of 2,507.0 cents. Amid this loss, the group did not declare a dividend for the period.
South African performance
Despite the issues in its international operations, Southern Africa delivered an improved performance.
This comes despite continued pressure on customers’ disposable income.
South Africa benefited from better execution at the wholesale level, enhanced retailer support programmes and reduced fuel-related logistics costs.
These factors contributed to improved operational stability and supported profitability through the second half of FY2025.
Southern Africa experienced improved growth in merchandise revenue sales in FY2025 H2, up 2.9%, which boosted full-year revenue by 2.3%.
The Groceries and Liquor business reported a year-on-year sales increase of 1.9%. Build it saw revenue increase 2.4% year-on-year.
SPAR Health continued to scale as an attractive growth adjacency with revenue growth of 13.2%, primarily by Scriptwise and the wholesale channel.
During the period, Pet Storey also acquired the Pet Masters Group businesses and formally launched the Pet Storey brand in September 2025.
Early indications suggest that Pet Storey is making good initial progress, and as of the end of November 2025, all 12 Pet Masters stores have been converted.
The concept is seeing significant interest with a strong pipeline for conversion.
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