Massmart says it lost out on R2.3bn in liquor sales in April and May
The retailer says total sales for the 23 weeks to June 7 fell 10.3% year on year, but it is continuing its organisational shake-up
Retailer Massmart, which has brands that include Makro and Game, says SA’s Covid-19 lockdown resulted in about R2.3bn in lost liquor sales in April and May.
This is based on comparable sales in 2019, the group said, as it warns that the pandemic has worsened losses this year, though pent-up demand had helped sales as SA’s lockdown has eased from level 5.
The group said in a trading update that it expects its headline loss per share for the 26 weeks to end-June 28 to be at least 50% worse than the headline loss per share of 364.7c previously.
Total sales for the 23 weeks to June 7 amounted to R34.8bn, which is 10.3% lower year on year. Sales from its SA stores amounted to R31.3bn, 11.5% lower than last year.
The group said operating costs in line with higher safety protocols amounted to about R50m, but that it is comfortable with its balance sheet, and has secured a R4bn inter-company loan from parent Walmart.
The retailer is implementing an organisational shake-up that has seen its four divisions reorganised into two business units. It said on Wednesday it was continuing this plan.
Massmart Retail will comprise the Builders, Game, DionWired and Cambridge Food trading brands.
Massmart Wholesale will take in Makro, Shield and the group’s wholesale cash brands.
In morning trade on Wednesday, Massmart’s share price was up 6.2% to R24.85, putting it on track for its best one-day performance in over a week.
Update: June 17 2020
This article has been updated with additional share price information.