SPAR braces for bad news
Retail group SPAR is expecting to underperform in its 2026 financial results, as boardroom drama and guild disputes have weighed on the retailer.
The company said in a voluntary update on SENS that it expected to underperform from the 2025 financial year.
It noted that operational pressure was concentrated in Southern Africa, particularly in its groceries and liquor segment.
“Operational improvements have not yet translated into sufficient earnings or cash benefits to offset that pressure,” the group said.
It noted that group sales revenue had moderated since its last interim trading period, and revenue growth in Southern Africa had been modest.
SPAR said the modest revenue growth in Southern Africa came as “wholesale volumes and trading remained subdued in a competitive consumer environment.”
“Consumer sentiment and consequently wholesale revenue continued to be under pressure with higher fuel, utility costs and elevated interest rates,” it said.
The group said it would announce its earnings per share ranges once it had reasonable certainty, in line with JSE listing requirements.
The forecast of a weak financial performance comes after SPAR has been at odds with its guild over the company’s leadership.
SPAR does not directly operate its stores; instead, it works with independent retailers represented in its guild.
In its update, SPAR said it had been working on improving the relationship between the company and its guild members.
“Collaboration between SPAR and its independent retailers continues to improve, with a greater focus on shared operational and commercial priorities,” the company said.
Earlier in 2026, the SPAR guild petitioned to remove the company’s former chairman, Mike Bosman, over a lack of belief in his leadership.
Following pressure from the guild, Bosman and deputy chairperson Shirley Zinn resigned on 17 August 2026.
The guild also raised concerns over procurement processes within the company, following distribution challenges for the retailer.
The company previously attempted to implement new SAP software at its KwaZulu-Natal distribution centre, which led to major losses and a R168 million lawsuit.
The search for new directors
In its latest update, SAPR provided an overview of the appointment process for the chairman and non-executive director positions, following the resignations of Bosman and Zinn.
“The Nomination Committee has appointed an independent search firm to support the recruitment process for these positions,” SPAR said.
“The Board aims to finalise and announce the appointment of the Chairperson and additional non-executive directors by early November 2026.”
These appointments would form part of the company’s larger turnaround strategy, which the retailer expects to build progressively through its 2027 financial year.
Other parts of this turnaround strategy include the turnaround, or potential closing, of underperforming corporate stores.
SPAR said it had also tightened its promotional discipline and would monitor key value items to ensure profitability.
In KZN, the company said it had exited its temporary overflow facility, cutting lease costs, and had completed the remediation of the province’s distribution centre flooring.
The group emphasised that KZN was a key focus, and that it was closely monitoring its performance in the province.
“KZN’s recovery remains a priority, with month-on-month improvement in gross margin being observed,” the company said.
“The Group will continue to work through the Guild and formal governance structures on the commitments arising from this work,” SPAR said.
“The relationship will be strengthened by consistent delivery and improved retailer outcomes, while difficult issues continue to be addressed directly.”
The turnaround strategy follows a difficult year for the retailer, during which its share price has plummeted since January.
In the year-to-date, SPAR has lost approximately R10 billion in market cap, and its share price has fallen by over 50%.
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