Pick n Pay closing stores across South Africa

South African retailer Pick n Pay is continuing with its recovery strategy, which has a key focus on closing or converting loss-making stores in the country.

Reporting its latest results for the year ended 2 March 2025, the group’s strategy appears to be paying off, with headline losses narrowing by over 60%.

This includes like-for-like turnover at company-owned supermarkets increasing by 3.3% year-on-year, with positive like-for like volume growth, it said.

“Steady progress has been made over the past 18 months, with like-for-like growth improving from -0.5% in H2 FY24 to 3.1% in H1 FY25, and 3.6% in H2 FY25,” it said.

Pick n Pay noted that a total of 40 loss-making Pick n Pay supermarkets were closed or converted.

25 company-owned supermarkets were closed, seven were converted to franchise stores, and eight were converted to company-owned Boxer stores.

Boxer’s results, reported earlier this month, noted that a total of 15 Pick n Pay stores were converted to Boxer stores during the year, including the aforementioned eight supermarkets and seven liquor stores.

Notably, Boxer said it experienced an uptick in business in these stores after being converted, showing that the strategy is working in the group’s favour.

As a result, the total number of Pick n Pay supermarkets, both company-owned and franchise stores, declined by a net of 45 stores to 570 supermarkets as of March 2025.

This includes 289 company-owned supermarkets and 21 hypermarkets, and 260 franchise supermarkets.

Another sign that the strategy is paying off for Pick n Pay is the reduction of about R1 billion in trading losses from the segment.

The Pick n Pay segment’s FY25 trading loss reduced to R549 million on a -0.7% trading margin from R1.5 billion on a -2.0% trading margin in FY24.

The entire FY25 trading loss reduction was driven by a significant H2 FY25 improvement, with the trading result swinging from a R864 million loss in H2 FY24 to a R170 million profit in H2 FY25.

Business picking up in other segments

While Pick n Pay’s traditional stores are still under pressure, the group is seeing significant growth in other parts of the business, including in digital and clothing.

Pick n Pay Clothing saw a net opening of 30 stores over the period, with like-for-like sales increasing 7.7%.

This brought the total to 415 stores, consisting of 396 company-owned and 19 franchise stores.

FY25 Clothing turnover growth from standalone stores was 11.6%. For the first 52 weeks of the year, turnover growth was 9.9% and 2.0% like-for-like.

Pick n Pay noted that port delays and a late start to winter drove a soft start to the year, but performance improved in the latter part of the year, with H2 like-for-like sales growth of 3.8%.

“Considering the high base, the group is pleased with the second half performance,” it said.

The group also saw a marked improvement in its online business, especially its Asap mobile app and its partnership with Mr D.

FY25 Online retail turnover, reported within PnP SA Supermarkets, grew 48.7% year-on-year (53-week basis). Turnover growth for the first 52 weeks of the period was 44.6%.

“The scale gains achieved have resulted in the Online business now being profitable on a fully costed basis,” Pick n Pay said.

While Online turnover growth was initially mostly driven by company-owned stores, Asap is now being increasingly adopted by franchisees, with triple-digit FY25 growth in franchise, it said.

“The Asap technology has been completely re-platformed over the last 18 months, and a new and upgraded Asap app was launched in April 2025,” it said.

The app now integrates Asap with Smart Shopper and value-added services and AI-driven functionality.

The group said that it will be rolling out a host of new features to fuel growth in the segment in FY2026. Pick n Pay’s website will also relaunch with the Asap on-demand service rolling out from 1 June 2025.

The new app is in Beta until the end of September 2025, it said.