Mr Price Group reports 45.3% rise in retail sales after acquiring European company

Sales Dynamics in Africa

Excluding NKD, retail sales in Africa increased by 3.2%, amounting to 9.3 billion rand. Despite this, this figure exceeded the country's average retail sales growth, measured by the Retailers Liaison Committee (RLC), at 0.8%. Mr Price directors noted that the competitive environment during this period was marked by promotions that intensified in June. Nevertheless, the company achieved its sales growth target at a pace ahead of the market without sacrificing gross margin, as the gross margin in Africa expanded by 40 basis points.

Challenges and Forecasts

In the 2026 annual reports, the group stated that trading after the end of the year in April was challenging, although some improvement was observed in May. In Africa, retail sales grew by 2.7% over these two months, compared to a baseline growth of 11.6%. Trading in June occurred against a weaker base figure (-5.1%, due to the shift of school holidays from June to July in the previous year), and retail sales in Africa increased by 4.3%, surpassing the RLC's projected decline of 2.6%.

Directors stated that 'the operational environment for retail in both African and European markets remained unpredictable. Prolonged geopolitical uncertainty due to the conflict between the US and Iran negatively affected consumer confidence, which remained negative and contributed to cautious consumer spending.' Inflation rose in both markets, reaching two-year highs in two key countries—South Africa and Germany. Higher interest rates also impacted consumer disposable income and their willingness to spend on discretionary goods.

Overall Figures and Segments

'Economic conditions continue to strengthen the resilience of the fast-moving consumer goods retail sector. The group remains confident that its portfolio of 16 retail chains is well-positioned for success in the respective markets,' the directors said. Total retail sales grew by 3.2% to 9.3 billion rand, while same-store sales remained unchanged. Retail sales in South Africa increased by 3.5% to 8.6 billion rand, while corporate store sales outside South Africa decreased by 0.3%.

Total sales in Africa increased by 3.1%, and online sales grew by 4.7%, accounting for 2.4% of total retail sales. The retail price inflation (RSP) of 1.5% was 'carefully managed' to protect the customer value proposition amid rising inflation. Total unit sales increased by 1.7%, reaching 68.7 million. The number of stores increased by 32, and the total network expanded to 3,214 stores, with the retail area growing by 3.8%. Credit sales increased by 3.8%, and the new account approval rate decreased by 50 basis points to 22.8%, as the group continues to cautiously manage credit issuance amid constrained consumption.

Segment Performance

In the apparel segment, retail sales grew by 3.4% compared to the RLC's flat performance. Same-store sales increased by 0.6%, and unit sales volume by 1.9%. All divisions in the apparel segment showed growth against the backdrop of a high base in April and May, and sales growth improved in June, albeit against a weak base.

The home goods segment increased retail sales by 0.7% compared to the RLC's growth of 5.8%. Same-store sales decreased by 3.3%, while unit sales volume grew by 0.2%. Mr Price Home and Sheet Street, targeting value-seeking customers, competed in an environment of intense promotions. Nevertheless, their focus on profitable sales growth allowed the chains to maintain their gross profit.

Yuppiechef, catering to higher-income customers, demonstrated double-digit sales growth against a double-digit base and improved its gross profit. In the telecommunications segment, retail sales grew by 11.2% against a double-digit base. In Europe, retail sales (100% cash) amounted to 3.8 billion rand. NKD outperformed both the apparel market and the fast-moving consumer goods segment in Germany, which accounts for about 60% of its sales.

Network Management and Outlook

As part of a space optimization program, 21 stores were closed and 23 opened, increasing the total number of stores to 2,156. Mr Price directors stated that the global macroeconomic environment remains uncertain, as geopolitical tensions continue to fluctuate with low expectations of a quick resolution. Trading conditions are expected to remain challenging and unpredictable for the remainder of the financial year.