SHP
SHP
Shoprite - Trading Update provided at AGM in Cape Town on 23 October 2006
Shoprite Holdings Limited
Incorporated in the Republic of South Africa
Registration number 1936/007721/06
ISIN: ZAE000012084
JSE share code: SHP
NSX share code: SRH
LuSE share code: SHOPRITE
("The Group")
SHOPRITE HOLDINGS LIMITED - TRADING UPDATE PROVIDED AT ANNUAL GENERAL MEETING
HELD IN CAPE TOWN ON 23 OCTOBER 2006
Group turnover grew by 12,0% for the three months to end September reflecting an
encouraging increase in basket size. The trading environment differed markedly
from that of the corresponding period of the previous financial year when
internal price inflation was considerably lower than it is currently.
The turnover of the Group"s South African supermarket operation grew 10,7% in
the first quarter which was below budget resulting from twelve weeks of
industrial action following a wage dispute, the first in the Group"s history.
This matter was resolved on 12 October when agreement was reached on a three-
year wage accord. The action disrupted trading in especially lower-income
communities and Shoprite supermarkets in particular were affected while trading
in Checkers outlets continued largely unaffected.
The Group"s non-RSA operations continued to perform well. The results being
achieved in Nigeria are most encouraging while countries such as Angola,
Mozambique and Zambia are reporting robust growth. The non-RSA business recorded
sales growth of 27,9% in rand terms.
In line with the rest of the sector, the furniture division"s sales growth
slowed further, to 11,3%. Margins remained under continuous pressure from
intense competition. These pressures are expected to increase further given more
expensive imports and higher interest rates.
Continuing its new-store programme, the Group added 8 new outlets in the first
quarter. A further 20 will be in operation by the end of December, 14 of these
within South Africa and 6 outside its borders, while 19 new outlets have been
confirmed for the second half of the financial year.
With the industrial action resolved, the Group expects to continue growing
strongly in the domestic market in the second quarter. Exciting non-food ranges
are being introduced for the Christmas season. A weaker rand will increase the
competitiveness of South African merchandise exported to the Group"s 110 stores
outside the country"s borders. Management therefore remains confident of
continued growth despite the expected slow-down in consumer spending.
23 October 2006
Sponsor: Nedbank Capital
Date: 23/10/2006 10:15:03 AM Produced by the JSE SENS Department
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