FX-woes continue to weigh on Shoprite’s turnover in sub-Saharan Africa

South Africa-based Shoprite, the largest supermarket chain in sub-Saharan Africa (SSA) with more than 400 outlets in 14 countries (excluding its domestic market), saw sales in these markets decline by 7.7% during the 12 months to June 2019. However, in constant-currency terms, they rose by 0.9%.

Against a background of hyperinflation and currency depreciation, Angola (Shoprite’s largest SSA market) was once again the main source of weakness: Sales in this market plunged by more than a third (38.4%) in reported-currency terms and by a more modest 12.2% in constant-currency terms during this period. Excluding this market, Shoprite’s reported-currency and constant-currency turnover in SSA markets increased by 3.8% and 5.8% year-on-year (y-o-y), respectively.

Currency devaluation also impacted Shoprite’s performance in Nigeria and Zambia, with reported-currency sales flat in both of these markets but constant currency sales rising by 5.6% and 10.1%, respectively.

More detail on Shoprite’s performance in SSA markets, including Kenya (where it plans to open a third store this month and another one or two by the end of the year), will be provided by its annual report, which is due to be published later this month.

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For a more in-depth analysis of Shoprite’s development, performance, strategy, and prospects, check our Sagaci Research’s Shoprite Research Report 2019.