Can Spar deliver against the tide of low-cost competition?
The retailer made more out of every rand it sold in the half-year to March, but it will have to regain the volume it lost in the South African market
After offloading its loss-making Polish unit in January, Spar has put two more underperforming European operations — Spar Switzerland and the UK-based Appleby Westward Group — up for sale.
This time it shouldn’t have to repeat the Poland fiasco of paying a buyer to take the business, yet the R4.2bn impairment of the Swiss and UK assets shows that any sale proceeds will be modest. The real win lies in removing roughly R3bn of debt and easing leverage to about double earnings before interest, tax, depreciation and amortisation. This is still steep for a low-margin grocery wholesaler, but a clear step in the right direction...
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