Pick n Pay narrows H1 loss by 32%
The South African retailer’s trading profit rose 58% to R490 million, while Boxer delivered 6.3% turnover growth and online sales surged 35.4% in the first half.
SOUTH AFRICA – South African grocery retailer Pick n Pay narrowed its headline loss by 32% in the first half of 2026, supported by improved margins and tighter cost controls as chief executive Sean Summers continued efforts to restore profitability and regain market share.
For the 26 weeks ended August 30, the retailer reported a headline loss of R299 million (US$18 million), down from the previous year, while trading profit increased 58% to R490 million. Group turnover rose 2.4% to R60.5 billion.
Gross margin expanded by 0.7 percentage points to 18.8%, supported by an improved product mix and supply-chain efficiencies.
The retailer has been pursuing its turnaround through cost reductions, store closures, improved inventory management and a renewed focus on fresh food. These measures have helped reduce stock holdings and release working capital.
Summers said Pick n Pay had introduced more than 50 new and upgraded fresh-food lines during the year, supporting category growth and greater customer participation.
“Customers are increasingly choosing Pick n Pay,” he said.
He added that the initial benefits of the turnaround were becoming visible in the financial results, with further gains expected over the next two-and-a-half years.
Chief financial officer Tina Rookledge said the trading environment remained challenging, with consumers under pressure and food inflation at a 16-year low. Retailers therefore needed to increase customer traffic to drive sales growth in value terms.
Summers estimated that the conflict in the Middle East, which has increased fuel costs, had reduced Pick n Pay’s sales growth by approximately three percentage points. He said each one-percentage-point reduction in sales growth cost the retailer between R140 million and R150 million in income.
The group’s performance was supported by Boxer, its value-focused grocery chain, where turnover increased 6.3%. The core Pick n Pay business recorded broadly flat sales following strategic store closures over the past year.
Boxer’s trading profit rose 8.1% to R1 billion. The retailer opened its 600th store during the reporting period. Pick n Pay retains a 53.1% stake in Boxer after selling approximately 57.3 million shares for R4.7 billion in May to help fund its turnaround.
Comparable sales at company-owned South African supermarkets increased 2.4%, exceeding internal price inflation of 1.5%, while online sales climbed 35.4%.
Pick n Pay has also agreed with labour unions on a revised store labour model, scheduled for implementation on November 1, to improve staffing flexibility and control costs.
Summers also credited the company’s sponsorship of the Springboks, South Africa’s national rugby team, with helping attract shoppers back to its stores. The agreement with SA Rugby also covers women’s and school rugby.
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