South Africa’s Shoprite Annual Profit Dips by 3.8%

Enterprise Television- South Africa’s Shoprite Annual Profit Dips by 3.8%

South Africa’s Shoprite reported a surprise 3.8 per cent fall in annual earnings on Tuesday, citing currency devaluation in Angola and lacklustre trading in other markets abroad.

Africa’s biggest grocery store chain reported diluted headline earnings per share (EPS) of 968.7 cents in the year ended July versus a 1,090 cents estimate in a poll of 10 analysts by Thomson Reuters’ I/B/E/S.

Analysts had expected an increase of 8.2 per cent.

Headline EPS, the most widely watched profit gauge in South Africa, strips out certain one-off items.

Sales of the Cape Town-based company rose 3.1 per cent to 145.3 billion rand ($9.9 billion).

Shoprite, which trades in 14 countries in the rest of Africa and Indian Ocean islands, said its local division reported turnover growth of 5.7 per cent, while its non-South Africa operations recorded a decline in sales of 7 per cent.

The company said its Angolan business was hit by a chronic shortage of foreign currency and devaluation, adding that the Angolan Kwanza had lost 50 percent of its value against the U.S. dollar since December 2017.

It said other markets outside South Africa “continued to experience lacklustre trading conditions and foreign exchange fluctuations.”

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