Pick N PAY Delivers ON First Year OF Multi-year Recovery Plan

“There are no surprises in this result, we are meeting the guidance that we have given every 6 months, making calm and steady progress. You cannot rely on quick wins in our situation, and it will continue to be a journey as we rebuild our institutional memory,” said CEO Sean Summers, speaking about the Pick n Pay Group results for the 53 weeks to 2 March 2025.

“This was an important year for Pick n Pay as we executed the first leg of our operational and financial recovery. We are exactly where we said we would be when presenting the strategy last May and in some aspects, we are tracking slightly ahead. Particularly pleasing is the reduction in our Pick n Pay trading loss by 64% after predicting a 50% reduction”

The first of its six strategic priorities announced in May last year was to recapitalise the Group. In this financial year, the Group completed its two-step recapitalisation plan—raising R12.5bn through the Pick n Pay Rights Offer (R4bn) and the Boxer JSE listing (R8.5bn) - and restoring the Group to a net cash position of R4.2bn.

“We have started to give much-needed attention to our core Pick n Pay supermarkets and we are pleased to see the early results in reporting positive like-for-like sales growth, notwithstanding the sustained pace of new store openings by our competitors in a restrained and competitive market.” said Summers.

The second of its priorities was to accelerate LfL sales growth, and the Group’s turnover for the 53-week period rose by 5.6%. Over the past 18 months, Pick n Pay company-owned supermarkets delivered consistent gains in LfL sales growth, improving from -0.5% in H2FY24 to +3.6% in H2FY25. Our franchisees have also shown steady positive recovery and this positive LfL momentum has continued in the first eight weeks of FY26.

The group maintained its focus on keeping selling prices down, recording inflation in Pick n Pay of just 2.1% for FY25, sharply down on FY24’s 8.2%, and well below Statistics SA Food CPI of 3.9%.

The third priority was to reset its store estate and the Group has made considerable progress either converting to Boxer, Franchising or closing those stores where there was no prospect of their returning to profitability. Importantly, a great deal of focus was put into certain of the loss-making stores, with some now returning to profitability. The retailer has also started opening and committing to new stores and will increasingly refurbish its supermarkets to meet and exceed customer expectations.

The fourth pillar of the strategy was leadership and people, with the ongoing focus on driving operational execution and restoring our Institutional Memory requiring both strong leadership and engaged employees. Key steps have already been taken, including staff training to improve the customer experience, reinstating regional leadership structures and launching a campaign to reignite employee pride and purpose.

The fifth pillar, strengthening partnerships, was clearly demonstrated in the tie-up with FNB e-Bucks, which has already helped attract customers across all segments. eBucks recently won three major awards, including best financial services loyalty programme in the world.

The new four-year Tier 1 Springbok rugby sponsorship has further amplified brand visibility and national pride and we celebrate the extraordinary role that our Springboks and sport play in unifying our country.

Lastly, Pick n Pay remains focused on innovation, adaptability and income diversification through its popular Smart Shopper programme, growing Retail Media capability, and omnichannel platforms, while expanding value-added services revenue.

More good news was a 48.7% growth in online sales for the 53 weeks, led by asap! and PnP groceries on Mr D. Pick n Pay asap! has grown to 600 locations and franchisee adoption of asap! has doubled in two years, with new growth potential unlocked with the launch of the new asap! App. The growth in scale has now resulted in achieving profitability on a fully costed basis. “We are very happy with our balance between clicks and bricks,” said Summers.

Pick n Pay Clothing delivered 11.6% growth from standalone stores in FY25 and reported market share gains. It opened net 30 company-owned stores during FY25, to bring the total estate to 415 stores.

“When I returned in October 2023 I stated that the recovery of Pick n Pay would be a multi-year process and that things would get worse before they got better. It is our sense that we see this unfortunate chapter now bottoming out and we have recalibrated our recovery programme to break even in FY28.

The journey of restoring institutional memory for long-term sustainability and success continues and we are investing ahead of the recovery ensuring a strong future-fit business with energy and conviction.

Importantly, our customer base is steadily growing as one by one they experience the change.

“It is with a passionate sense of pride and honour that I have confirmed an extension to my contract till May 2028, thereby ensuring leadership continuity in the short term followed by an orderly succession process” said Summers.