Spar (SPP) 1H23 – Results Snapshot

Diluted HEPS 447.7cps (-30.2% y-y).
Turnover growth +7.9% y-y, with SA +5.6%, Ireland +8.8% (EUR), Switzerland -4.3% (CHF) and Poland +4.9% (PLN).
GPM increased from 11.9% in 1H22 to 12.1% in 1H23 with improved margins in all regions except Switzerland.
Expense-to-sales ratio increased from 11.3% to 12.0% with expense growth of 14.7% y-y. High growth in fuel and energy
costs, and IT (SAP-related) costs.
Operating margin dropped from 2.7% to 2.1%.
No dividend (1H22: 175cps).
Capex of R1.1bn and capex to sales ratio at 1.5% (1H22: 1.1%).
Gross debt increased from R6.8bn to R8.5bn, and net overdraft increased from R2.7bn to R4.2bn. Weakening rand coupled with
lower profitability caused a breach of the group’s leverage covenant in Mar 23. Financiers approved waiver of breach of
group leverage covenant.
Results impacted by cost pressures, SAP go-live issues at KZN DC and subsequent loss of turnover.