South African retail operator Pepkor has registered a 9.5% increase in group revenue for the first half (H1) of the fiscal year 2024 (FY24), reaching R43.26bn ($2.35bn) compared with the R39.52bn reported in the same period of fiscal 2023.  

The company attributed the growth to strong performance in traditional retail, particularly in the second quarter. 

Pepkor’s operating profit before capital items rose to R5.11bn in H1 FY24, up 4% from R4.91bn in the first half of the previous fiscal year.  

However, its earnings per share saw a decline of 3%, dropping to R75.4 in H1 FY24 from R77.7 in H1 FY23. 

Pepkor’s gross profit margin improved notably, increasing by 200 basis points to 38.1% in H1 FY24.  

The retailer’s retail gross margins have benefited from improved full-price sales and lower markdown activity.  

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Pepkor’s brands PEP, Ackermans and Specialty achieved double-digit sales growth and the JD Group recorded high single-digit sales growth. 

The company noted that “the performance was achieved in the context of a challenging operating environment”.  

During the period, in-store product availability was severely impacted due to import supply chain disruption. 

The group continued its retail store expansion in H1 FY24, opening 111 new retail stores and bringing the total number to 5,823. 

On 29 February 2024, Pepkor announced the divestiture of The Building Company (TBCo) to streamline the group’s portfolio, enhance return on capital and optimise shareholder returns.  

The company will use proceeds from this disposal to reduce debt and fund strategic growth and value-accretive initiatives. 

Pepcor has experienced a fluctuation in trading since March 2024, while trading across most brands strengthened in April. 

Looking ahead to the second half of the fiscal year, the company will be contending with a higher comparative base due to the inclusion of a 53rd trading week in FY23.