Massive R4 billion loss for SPAR

The SPAR Group has recorded a R4 billion loss in its interim results, as the group looks to sell its British and Swiss businesses.

In the group’s results for the six months ended 28 March 2025, the group classified SPAR Switzerland and its British business AWG as discontinued operations.

These businesses recorded aggregated post-tax losses of R4.4 billion, which included impairments of R4.2 billion.

The group already disposed of SPAR Poland in January 2025, with the group stating that these sales form part of efforts to realise value and ensure business continuity in these regions.

On the income statement, the total loss from these discontinued operations totalled R5 billion.

Regarding the group’s continuing operations, South Africa’s revenue growth only stood at 1.7%, while Ireland saw a 0.6% decrease in local currency.

It noted that this reflects the ongoing pressure on consumer spending, compounded by low food inflation and the timing of Easter, which fell in the second half of the financial year.

The revenue growth in South Africa was underpinned by strong momentum in the lower-income customer segment.

The Build It and SPAR Health businesses continued gaining traction, supported by strong retailer engagement and category performance.

Nevertheless, the R768 million profit from South Africa and Ireland could only reduce the loss for the period to R4.3 billion.

When including gains from exchange rate differences of R300 million, the group’s total loss attributable to shareholders was R4 billion.

The group’s earnings per share also dropped by over 7,500% to a loss of 2,211.1 cents per share.

As per the group’s capital allocation priorities and ongoing restructuring, no interim dividend for the period was declared.

Future dividend decisions will be reconsidered based on future macro-economic and operating conditions.

Outlook

“Over the period, we made deliberate progress against the milestones we set to simplify and optimise our portfolio and strengthen our balance sheet,” said SPAR Group CEO, Angelo Swartz.

“This positions us well to harness future opportunities. Looking ahead, our focus remains on driving continued margin improvement, executing effectively in our core markets and delivering on the remaining elements of our strategic reset.”

The group maintained its strategic focus on driving profitability through category mix optimisation, private label growth, and improved operational efficiency.

Swartz said that there should be continued margin improvement in the second half of the year as operational efficiency initiatives gain traciton.

In Southern Africa, the group’s growth prospects are grounded in engaging various retail segments, which leverage its strategic Uber Eats and Vida e Caffèm and growing private label product penetration.

The group is also increasing its investment in customer convenience with the continued rollout of its demand digital platforms, SPAR2U and Build it 2U.

Its partnership with Uber Eats is now live in 130 stores, enabling SPAR to reach new customers and enhance customer access and experience.

Investment in pharmacist training facilities is also underway to support the growth of SPAR Health, with the hope of doubling its pharmacy network by 2028.