The SPAR Group Limited (“SPAR” or “the Group”) today reported a resilient performance underpinned by significantly improved second-half trading, disciplined cost management, robust cash generation and a materially strengthened balance sheet, as the Group concludes a pivotal year of strategic simplification.
“This year represents a reset for SPAR. We have taken purposeful steps to reduce debt, simplify the Group, improve operational efficiency and restore resilience across the Group, laying a stronger foundation for sustainable growth. The momentum we saw in the second half, combined with improved cash generation and lower leverage, gives us confidence in our ability to restore shareholder returns while continuing to invest responsibly in the business,” said The SPAR Group CEO, Angelo Swartz, at the release of Group results for the 52 weeks ended 26 September 2025.
SPAR’s financial position improved meaningfully over the year, with Group net debt reducing by 40% to R5.4 billion from R9.1 billion in 2024 and leverage improving to 1.74x. This was primarily due to the strategic disposals of Switzerland and Poland and improved working capital management. Cash generated increased to R5.4 billion, up from R4.8 billion in the prior period.
Comparable Group revenue increased by 1.6% for the year, accelerating to 3.5% growth in the second half, while gross profit from continuing operations was resilient, increasing 3.3% and gross profit margin improving 20 basis points to 10.8%. Operating expenses remained well contained, supported by lower fuel costs, enabling operating profit (excluding extraordinary items) to increase to R2.8 billion. The Group’s operating margin of 2.1% was maintained broadly in line with the prior year, demonstrating earnings resilience in a constrained trading environment.
The BWG Group in Ireland remains stable and strategically valuable and delivered an operating profit margin above 3% despite the impact of wage and overhead inflation. This performance, alongside stronger trading in the second half of the year, reflect a business that remains well positioned with strong retailer relationships and leading brands.
Southern Africa delivered modest top-line growth of 2.3% for the year impacted by a subdued retail environment. Notably, the second half saw a marked improvement in sales momentum, rising by 2.9%. Operating profit increased by 6.8%, supported by improved wholesale execution, supply-chain efficiencies and strict promotional discipline. Retailer loyalty remained resilient at 78.6% while on-demand channels continued to gain momentum, with volumes increasing by 136% year-on-year. To further empower consumers with more choice in how they shop, a partnership with Uber Eats was entered into in March 2025, which has already shown strong uptake.
Growth adjacencies continued to gain traction, with SPAR Health delivering 13.2% growth and the formal launch of the Pet Storey franchise opening a new specialist retail platform with strong early interest. Performance in SPAR Health was driven primarily by the wholesale channel growing 9% and the ongoing success of Scriptwise, which grew by 20%, supported by the expansion of chronic medicine programmes. Build it reported stable revenue, with a 2.4% year-on-year increase; retailer loyalty stood at 67.8%, a slight decrease from 68.4% the previous year. The business benefited from strong retail performance and the sustained provision of microloans to consumers within the industry, most notably by Capitec.
As South African households continue to face relentless cost-of-living pressures, SPAR has focused on helping grocery budgets go further and enhancing lives. Even as food inflation remains elevated and consumers grow more price-conscious, SPAR is helping put nutritious, affordable meals on the table every day, with the launch of ‘Super Savings’ and the revamped SaveMor format, ensuring that families can stretch their budgets further without sacrificing quality. “Our unique independent retailer model remains the engine of SPAR’s innovation and customer closeness,” said Swartz.
The recent opening of the first-ever SPAR Gourmet store at Zimbali Oasis, demonstrates the strength of partnership-led growth, where national capabilities and local entrepreneurship combine to create new, high-quality shopping experiences. From luxury to last-mile convenience, SPAR continues to serve every South African in every community.
“We have also ensured that value stays at the centre of key trading moments. This year’s Black Friday campaign prioritised discounted staples and household essentials, enabling customers to build a multi-meal grocery basket for less than R375. It is a clear example of how SPAR uses scale, data and a growing digital ecosystem to support households through tough times,” noted Swartz.
While no distribution was declared, the Board reiterated its commitment to reinstating shareholder returns in the short to medium term as leverage continues to normalise.
Looking ahead, management remains focused on accelerating technology rollout to enable more innovative retail, achieving margin recovery in Southern Africa, maintaining ongoing balance sheet deleveraging, and practising disciplined capital allocation. Furthermore, SPAR is committed to enhancing service delivery across rural and township markets, recognising both its responsibility and unrivalled opportunity to uplift communities and small businesses.
“In every decision we make, whether in pricing, innovation or investment, SPAR is delivering progress with purpose. With a stronger balance sheet, improving trading momentum and a simplified operating footprint, we are focused on delivering consistent earnings quality and rebuilding shareholder returns. We remain dedicated to supporting our independent retailers, customers, and fostering retail growth alongside community wellbeing,” concluded Swartz.
Mule Skinner
Stock market II: According to the Economist (2016), the JSE ranks 18th in terms of “largest market capitalisation” out of 140 countries. Even during these difficult economic circumstances it is interesting to note that South African companies are still deemed valuable and are resilient during tough times. This resilience indicates that one can still start-up a dream business in these conditions.