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Shoprite defies South African downturn as domestic sales surge
[JOHANNESBURG] Shoprite Holdings Ltd reported improved trading at its South African stores even as its main customer base of lower-income shoppers battles with the impact of an economic showdown and high unemployment.
Local supermarket sales at Africa's biggest grocer rose 10 per cent in the three months through September, compared with 1.7 per cent in the same period a year ago. The owner of chains including Checkers and U-Save continues to benefit from an IT-system revamp and store openings, the Cape Town-based company said Monday.
Shoprite reported the update at the start of its annual general meeting, where Chairman Christo Wiese is expected to come under pressure from investors over his almost three decades in the role. Shareholder All Weather Capital nominated former Pepkor Ltd head Jan le Roux as a director to try and reduce his influence, and the proposal will be voted on later Monday.
Shoprite's operations in the rest of Africa continued to struggle, with sales falling 4.9 per cent in the third quarter. Management is assessing the performance, with specific reference to the return on capital invested across the continent.
The Nigerian business suffered from xenophobic attacks on stores, the company said. Those followed an outbreak of violence in South Africa against immigrants from elsewhere on the continent.