Is Pick n Pay’s Turnaround Real?

What’s behind these improvements?
Several factors have driven this positive shift:

• Stronger performance at Boxer Retail Limited: Boxer continues to post steady profit growth, which helps offset losses in the broader group.
• Significant reduction in impairments: Pick n Pay cut impairments from R2.4 billion last year to less than R0.5 billion. This materially improved the balance sheet.
• Lower interest charges: Thanks to a successful recapitalisation plan, the group’s finance costs have decreased, easing pressure on earnings.
• Better trading profit at Pick n Pay: Although still loss-making, the core business showed some improvement in trading profit.

What’s still under strain?
Despite these gains, Pick n Pay made it clear: its core grocery business is still operating at a loss when accounting for lease interest. This means that even with better trading performance, the turnaround is incomplete, and will take more time and work.

What does this mean for investors?
Pick n Pay’s trading update signals a company managing its way back from a difficult period, but not yet at profitability. The sharp reduction in losses per share and lower impairments are clear positives. Boxer’s consistent profit growth remains a bright spot supporting the group.

However, the fact remains that the flagship Pick n Pay grocery chain has not returned to profitability, and the path to sustainable earnings is still uncertain.

For investors, the takeaway is cautious optimism: the business is stabilising, but the turnaround is far from complete. Monitoring future earnings releases and operational updates will be key to assessing whether Pick n Pay can sustain and build on this progress.

The company released its audited full-year results on Monday, 26 May 2025, followed by a webcast presentation. You can find the details and replay on the Pick n Pay Investor Relations website.

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