Get Pick n Pay for free
Pick n Pay’s market cap is lower than the value of its 65.6% stake in Boxer, which means investors essentially get Pick n Pay Stores for free if it invests in the company.
On Monday, 27 October 2025, Pick n Pay released its interim results for the 26 weeks ended 31 August 2025.
On a group level, the company saw its turnover grow by 4.9% to R58.8 billion and its trading profit improve by 273.5% to R310 million.
However, this was primarily driven by Boxer’s standout performance. It grew turnover by nearly 14% to R22.52 billion and its trading profit by over 16% to R931 million.
In contrast, the company’s core brand, Pick n Pay, proved to be a drag on the company’s latest interim results.
This segment reported that its turnover remained essentially flat at R36.3 billion and it recorded a trading loss of R621 million.
However, it is not all bad. This loss is a 13.5% improvement from the first half of the company’s 2025 financial year.
The retailer attributed its loss to a reduction in store estate, which declined by 59 supermarkets over the 26-week period.
Investors were not impressed by the retailer’s results, and Pick n Pay’s share price plummeted after the results were released.
Pick n Pay stores’ revenue remained virtually unchanged. Its revenue increased by only 0.06% from the previous interim period, growing from R36.29 billion to R36.30 billion.
This means Pick n Pay stores are not increasing their market share and seeing no real growth in revenue.
Pick n Pay South Africa, for instance, has seen its revenue on a downward trend, reporting a 0.4% decrease in revenue compared to the previous period.
Analyst opinion about Pick n Pay
Jonathan Fisher from PSG Wealth Sandton highlighted that Pick’n Pay’s financial results look good on the face of it.
However, when you delve deeper into the numbers, the performance of Pick n Pay as a standalone business does not look great.
“If you consider the trading profit, which increased by 273% to R310 million, Boxer contributed R931 million. Pick n Pay had a trading loss of R601 million,” he said.
He said Pick n Pay is still making losses. It reduced these losses somewhat, but not to the extent which management would like.
Another challenge is that the sales growth of the company-owned stores is lower than the like-for-like operating cost growth.
Fisher predicted that it would take a fair amount of time for Pick n Pay to return to profitability, which may concern many investors.
Grant Nader from Benguela Global Fund Managers agreed with Fisher, saying there are no clear signs that Pick n Pay’s turnaround strategy is working yet.
“They are doing the right things. The losses are decreasing and the retailer is sustaining some kind of margin,” he said.
This is partly driven by the strategy to close many loss-making company-owned and franchise supermarkets.
Pick n Pay’s shrinking store estate means that it has lost market share. However, this is now stabilising as the strategy to close stores is over.
Nader added that Boxer and Pick n Pay Clothing are shining lights, which bodes well for the retailer’s growth.
However, he does not like the core business model and does not see the turnaround strategy playing out yet.
Pick n Pay’s market cap
An interesting situation is that investors basically get Pick n Pay for free when they buy shares in the company.
Boxer, which is now a separately listed entity 65.6% owned by Pick n Pay, is the shining light in the group’s portfolio.
Pick n Pay’s 65.6% shareholding in Boxer has a market value of R23.4 billion, while the Pick n Pay Group’s market cap is only R22.2 billion.
This means that shareholders discounted Pick n Pay stores to less than zero, to a value of -R1.3 billion.
Loading ...