Pick n Pay’s recent financial performance indicates ongoing challenges, as the group reported a loss of R827.4 million for the 26-week interim period ending on August 25, 2024. Despite efforts to improve profitability, the company continues to face financial hurdles, although signs of strategic progress are visible.
The group’s turnover experienced a modest 3.7% increase, rising to R56.1 billion from R54.1 billion in 2023, according to the latest financial results. This growth reflects efforts to stabilize amidst a challenging economic environment. In the first half of the 2025 financial year, Pick n Pay’s supermarket division showed improvement, with like-for-like sales growth reaching 3.1%. This recovery marks a shift from the negative sales growth of -0.5% recorded in the latter half of FY 2024.
Pick n Pay’s financial report also highlighted rising expenses. Financing costs amounted to R1.13 billion, contributing to a pre-tax loss of R1.05 billion—an increase of 25.7% compared to the previous year. This surge in financing costs reflects the impact of ongoing investments in the company’s turnaround strategy and increased borrowing costs. Additionally, trading losses rose by 9.1% to R718.9 million, aligning with budget forecasts and reflecting a narrower gross profit margin for FY 2025.
“The group’s comparable loss before tax and capital items grew 25.7% year-on-year to R1.1 billion, reflecting the trading losses in Pick n Pay alongside higher borrowing costs,”
the company statement detailed.
Pick n Pay’s Chief Executive Officer (CEO) Sean Summers remains optimistic, aiming to cut trading losses in the Pick n Pay segment by up to 50% for the full financial year. Summers shared that the leadership team is fully committed to the turnaround strategy, with confidence that the company’s future performance will reflect these changes.
One of the highlights of Pick n Pay’s recent progress lies in its Boxer business, which recorded an impressive 16% increase in trading profit year-on-year. Boxer has shown robust sales growth of 12%, driven by both like-for-like sales at +7.7% and new store contributions at +4.3%. Summers emphasized that Boxer’s performance has reinforced Pick n Pay’s strategy, noting that the planned Initial Public Offering (IPO) for Boxer will be a significant milestone.
“We are excited to see it thrive as a listed entity, and it will be one of the most exciting listings on the JSE in years,”
Summers stated, underlining Boxer’s potential as a separate entity on the Johannesburg Stock Exchange.
Summers elaborated on the focus areas for the current financial year, noting that attention has been placed on strengthening the company’s balance sheet and advancing the turnaround plan. He pointed out that once the capital structure is stable, Pick n Pay will prioritize store refurbishments and expansion.
“Our focus this year has been strengthening our balance sheet, as well as implementing the turnaround plan. Once our capital is in place, we can also start investing in refurbishing Pick n Pay stores and opening new ones,”
Summers explained.
Reflecting on his decision to return to the company a year ago, Summers acknowledged that the journey was anticipated to be lengthy and challenging, with short-term financial pressures expected as part of the process.
“Exactly a year ago, when I re-joined Pick n Pay, I forecast that this would be a multi-year journey and that it would get worse before getting better. Our earnings for the first half reflect this, and I am confident that the worst is behind us now,”
he shared.
Despite the substantial loss for the interim period, Pick n Pay remains committed to its turnaround strategy, with steady improvements observed in key areas. While the impact of high financing costs and trading losses is apparent, the group’s leadership is optimistic that strategic initiatives—particularly the performance and IPO of Boxer—will contribute to a stronger financial position in the long term.
