Cape Town - Supermarket chain Shoprite would open its first store in Nigeria, Africa's most populous country, on Monday, Whitey Basson, the chief executive of Shoprite Holdings, said yesterday.
Speaking at the company's annual general meeting, Basson said Shoprite, which already has stores in 14 African countries and Indian Ocean islands, was considering opening one in the Democratic Republic of Congo, "which seems to be stabilising ... We are waiting for its banking and information technology systems to stabilise."
The group would expand further in the rest of Africa by opening more stores in some of the countries where it was already trading, starting with Tanzania and Madagascar, in each of which it had seven stores, and Mauritius, where it had one at present.
But Basson said countries in west Africa with oil reserves seemed to be stabilising. After an initial period, the chain achieved higher returns from stores in other African countries than in South Africa.
Christo Wiese, the chairman, said Shoprite's first franchise store in Mumbai was doing well and it was considering several invitations to take up space in new shopping malls in India.
In a trading update, he said that in the first three months of the current year total turnover rose by 11.8 percent compared with the same period last year.
Although food price inflation had increased marginally, it remained well below the consumer price index, with many staple products selling at prices below those of a year ago. Operating profit and margins were on budget.
The Shoprite, Checkers and Usave chains returned solid growth - with Shoprite, in particular, reporting increases in basket size and the number of customer transactions - and market share increased marginally.
Wiese said the furniture division was starting to reflect a slowdown in consumer spending, with a turnover growth of 13.9 percent. The group's operations outside South Africa recorded turnover growth of 12.9 percent in rand terms.
In the first three months of the current financial year, eight supermarkets and five Usave stores were opened. Twenty more stores would be opened in South Africa by the end of December and 12 outside its borders.
Wiese warned that although the group was confident that the growth trend in the first quarter would continue in the second quarter "a decision by government to interest rates could curb such expectations.
In that case, the sale of durable and semidurable goods would be affected more than that of food as the lower-income groups tend to be less affected by such changes." Shoprite shares rose 0.63 percent to R16.10 yesterday. The food and drug retailers sector fell 0.18 percent.