Shoprite grows sales to R270.8bn, adds Vida e Caffè to its stable

Shoprite has posted double-digit dividend growth and a R270.8 billion sales haul for the year to June 2026, but the bigger story may be what comes next. The retailer is stepping well beyond groceries, striking deals in coffee and fintech that could reshape its footprint in the years ahead. Margins improved and cash reserves swelled, even as costs crept up on several fronts. Here's what the numbers reveal about Shoprite's next chapter..BizNews Reporter.Shoprite Holdings has reported group revenue of R274.8 billion for the 52 weeks to 28 June 2026, up 7.1% on the prior year, with sale of merchandise from continuing operations rising 7.2% to R270.8 billion. The retailer's diluted headline earnings per share (DHEPS) increased 12.2% to 1,527.4 cents, while adjusted DHEPS rose 12.5% to 1,579.2 cents..Ringing it up: the headline numbersThe good: register receipts are looking healthySale of merchandise grew 7.2% to R270.8 billion, translating into an additional R18.1 billion in incremental sales versus the prior year. In line with the group's dividend cover policy, the full-year dividend rose 11.8% to 873 cents per share, with a final dividend of 566 cents payable on 28 September 2026.The bad: the comparison isn't quite apples-to-applesThe 2025 base against which these results are measured has been restated, after the group reclassified its remaining Nigerian mall investments as discontinued operations under IFRS 5. Basic earnings per share including discontinued operations rose a more modest 4.9% to 1,469.4 cents, reflecting a R159 million loss from discontinued operations in the year.The takeaway: still a solid trading yearEven accounting for the restatement, sales, trading profit and dividends all grew at a healthy clip, with headline earnings comfortably outpacing revenue growth..Shelf life: how the brands stacked upThe good: Checkers keeps climbing, Sixty60 deliversCheckers and Checkers Hyper, including their LiquorShop offering, grew sale of merchandise 10.0% to R105.2 billion, aided by 2.0% and 1.2% internal selling price inflation respectively. The on-demand delivery platform Sixty60 added a record R6.6 billion in revenue, growing sales 34.5% to R25.5 billion across 976 stores.The bad: not every banner is boomingOK Franchise, part of the group's Other Operating Segments, increased sales by just 0.6%, weighed down by a net decrease of 42 stores following the termination of a 51-store franchise agreement during the second half. Little Me, a smaller adjacent format, closed a net three stand-alone stores in favour of positioning the brand inside Checkers Hyper.The takeaway: growth is broad, but unevenThe core Supermarkets RSA segment — 84.5% of group sales — grew 7.1%, with Shoprite and Usave posting selling price deflation of -0.1% and -0.6% respectively even as sales rose 4.3%. Growth is coming from multiple brands and formats, but not uniformly across the portfolio..Counting the coins: margins, cash and debtThe good: healthier margins, fatter cash pileGross margin improved to 24.5% (2025: 24.3%) and trading margin rose to 6.0% (2025: 5.9%), lifting trading profit 8.4% to R16.2 billion. Net cash rose 60% to R13.0 billion (2025: R8.1 billion), and adjusted return on invested capital measured 19.8%, well above the group's 11.5% weighted average cost of capital.The bad: the bills are creeping up tooOther operating expenses rose 7.7%, driven partly by a 19.2% jump in electricity and water costs, reflecting the 12.7% NERSA electricity tariff increase and lower diesel costs, and an 11.2% rise in security costs. Net finance costs increased 5.0% to R5.0 billion, and the group's lease liabilities grew by R2.3 billion to R49.3 billion, pushing total debt (including leases) to R55.9 billion (2025: R54.0 billion).The takeaway: profitable growth, but costs aren't standing stillMargins and cash generation both improved, but rising lease, utility and security costs are a reminder that top-line growth alone doesn't tell the full story..Shopping spree: what's next for the groupThe good: coffee and fintech join the trolleySubsequent to year-end, Shoprite signed an agreement to acquire 100% of Vida e Caffè, South Africa's leading coffee brand with roughly 400 corporate and franchise stores, and took an initial 51% stake in payments and technology company R&A Cellular to expand its financial services reach into the informal retail sector. July 2026 trading got off to a strong start too, with group sales up 7.7% and Supermarkets RSA up 8.3%.The bad: not everything is a done dealThe Vida e Caffè acquisition remains subject to regulatory approval, with an effective date only expected in the 2027 financial year. Separately, the long-running disposal of the group's South African furniture business (OK Furniture and House & Home) to Pepkor Holdings is still awaiting South African Competition Tribunal approval, with a hearing scheduled towards the end of the first half of 2027 and an outcome expected in the second half.The takeaway: expansion continues, but on a longer timelineShoprite is diversifying beyond its core grocery business, but as with any regulated transaction, the newest deals will take time to close.Shoprite's results were reviewed, not audited, by Ernst & Young Inc., which issued an unmodified review conclusion on the condensed consolidated financial statements..Sign up for your early morning brew of the BizNews Insider to keep you up to speed with the content that matters. The newsletter will land in your inbox every morning on weekdays. Register here.Support South Africa's bastion of independent journalism, offering balanced insights on investments, business, and the political economy, by joining BizNews Premium. Register here.If you prefer WhatsApp for updates, sign up to the BizNews channel here.

Shoprite grows sales to R270.8bn, adds Vida e Caffè to its stable

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