South Africa’s SPAR Group posted modest wholesale turnover growth over 18 weeks, with promotions lifting volumes but compressing margins in a subdued inflation backdrop.
Wholesale turnover from continuing operations rose 2.1% year on year in the 18 weeks to 30 January 2026.
Ireland (+6.1%) and SPAR Health (+23%) led growth, while Southern Africa increased 0.9% and Build it fell 2.4%.
Within Southern Africa, grocery & liquor turnover edged up 0.8%, reflecting a weak October before improving 2.3% across November to January.
Internal selling price inflation averaged 2.6%, below official food inflation of 4.3%.
Southern Africa gross margins declined due to an unfavourable sales mix, Black Friday promotions and continued investment in loyalty and margin recovery efforts in KwaZulu-Natal.
South African retail sales rose 1.9%, with like-for-like growth of 2.25%; SUPERSPAR stores performed relatively better, supported by perishables.
In Ireland, its BWG Group sales increased 3.1% in local currency, helped by higher-margin non-tobacco categories and foodservice, with retailer loyalty stable across brands.
The group said disposal of its UK subsidiary Appleby Westward Group is advancing, with transaction structure largely agreed and no additional material impairment or cash injection currently anticipated.
The sale aims to simplify the geographic footprint and reinforce the balance sheet.
Margins remain under strain from higher operating and wage costs, SAP-related spending and promotional activity.
SPAR is pursuing structural cost measures including distribution network optimisation, centralised procurement and stronger pricing governance, with benefits expected over time.
The company has adjusted its SAP rollout to separate finance from distribution-centre integration to limit disruption; a unified finance environment is planned for FY26.
It also confirmed it has received a summons regarding alleged claims tied to the SAP implementation at its KwaZulu-Natal distribution centre and will respond through legal processes.
SPAR expects first-half FY2026 operating margins to stay below the prior period, with recovery weighted to the second half as KwaZulu-Natal corrective measures take effect and volumes recover.
The group intends to appoint a dedicated managing director for Southern Africa Grocery & Liquor to speed execution.
