Pick n Pay holds onto dividend as core SA business barely shows growth

Retail group Pick n Pay has scrapped its interim dividend, swinging into an interim loss after blows from load shedding and increased competition, with its core namesake brand in SA barely showing any growth.

Group turnover rose 5.4% to just over R54 billion in the six months to 27 August, it said on Wednesday, reporting a R571 million loss from just over R453 million previously. Internal selling price inflation for the period was 8.3%, below food inflation of 11.4%, but also implying a significant fall in volumes.

Pick n Pay was hit by R565 million in incremental abnormal costs in the period, including R259 million for employee restructuring, R190 million net incremental energy costs, and R116 million for duplicated supply chain losses. The latter related to its switch to a new distribution centre in Gauteng, while net finance costs jumped 47.3% to R913 million.