Pick n Pay sends a warning as losses deepen despite pockets of growth

Pick n Pay sends a warning as losses deepen despite pockets of growth

Pick n Pay has sent a clear signal to the market: the road to recovery is proving tougher than expected.

In a trading statement covering the 48 weeks to 1 February 2026, the retailer warned shareholders that its headline loss per share for the current financial year is expected to worsen by more than 20%. In practical terms, that means an additional loss of over 12 cents per share compared with the previous year.

For a brand that has been part of South African shopping culture for decades,  from corner supermarkets to family weekend grocery runs, the numbers underline just how difficult the retail environment remains.

Losses grow as turnover disappoints

In its update, Pick n Pay said the deeper loss is largely the result of turnover coming in below expectations. The group had previously guided that its 2026 trading loss would be broadly in line with 2025, but that outlook has now shifted.

“The expected increase in the FY26 loss per share versus FY25 is due to below-expectation turnover,” the group said, adding that it does not yet have reasonable certainty on what earnings per share will look like by year-end.

It’s a sobering admission in a market where consumers are still under pressure from rising living costs, interest rates and cautious spending habits.

Mixed picture on the shop floor

Zooming in on operations, the performance across the group was uneven.

Pick n Pay South Africa recorded like-for-like sales growth of 2.9%, with company-owned supermarkets performing slightly better at 3.5%. However, overall turnover in South Africa slipped by 1.4%.

That decline wasn’t entirely unexpected. The group said it was linked to the largely completed process of closing or converting underperforming stores, a painful but strategic clean-up aimed at stabilising the business long term.

Boxer continues to shine

While the core Pick n Pay brand struggles for momentum, Boxer once again stood out as a bright spot.

Boxer’s turnover surged by 11.9% over the period, with like-for-like growth of 3.9%. In a tough economy, the discount retailer’s value-focused offering continues to resonate with price-sensitive shoppers, a trend that mirrors broader shifts in how South Africans are buying food.

On social media, some shoppers pointed to Boxer’s pricing as a lifeline, while others questioned whether Pick n Pay’s traditional formats are battling to stay competitive in an increasingly value-driven market.

A soft November and cautious consumers

Looking at the final 22 weeks of the reporting period, group turnover rose by a modest 1.3%, including a 1.7% like-for-like increase. Pick n Pay said performance during that stretch was dragged down by a particularly soft November, reflecting wider market conditions felt across the retail sector.

In other words, it wasn’t just a Pick n Pay problem, consumers across the board were spending less.

Online shopping offers some relief

One area that continues to deliver strong growth is online retail.

Online turnover jumped by 31.8%, driven by the ongoing expansion of Pick n Pay asap! and grocery sales through the Mr D app. As load shedding, traffic and time pressures reshape shopping habits, convenience is becoming non-negotiable for many households.

What comes next

Pick n Pay expects to publish its full financial results around 25 May 2026. Until then, the trading statement serves as both a warning and a reality check.

The group is cutting back where it must, leaning into growth areas like Boxer and online, and trying to steady a legacy brand in a tough economy. Whether that’s enough to stop the slide and eventually return to profit is the question investors and shoppers alike will be watching closely in the months ahead.

{Source: My Broad Band}

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