Spar warns 2026 performance will lag 2025 as turnaround progresses

Spar says it is working hard to identify a new board chair and will do so in an “independent, rigorous and transparent manner”, while suggesting its main southern African business continues to struggle and will earn less in its latest financial year than in 2025.

Moneyweb recently reported that on 10 September, the Spar Guild wrote to the board backing turnaround specialist Phil Roux, former Nampak CEO, for the position of chairperson, and suggesting some shareholders were also supportive of Roux.

Roux told News24 he would consider the position. Chairperson Mike Bosman and deputy chairperson Shirley Zinn resigned with immediate effect on 17 August.

Spar said all candidates are being assessed through the same process and it has received representations from shareholders and retailer representative structures.

“The board remains committed to conducting this process in an independent, rigorous and transparent manner, and will update shareholders further as and when there are material developments.”

Spar said it aims to finalise the appointment of the chairperson and members to the board by November 2026.

Business challenges being addressed

Spar did not give specific earnings figures, as these are not yet required by JSE listing requirements, but said its results for the financial year 2026 ending late September will lag that of 2025.

It said “management’s immediate priority is to improve profitability and cash generation in southern Africa while maintaining appropriate levels of support for retailers”.

While working to improve the business, its earnings do not yet reflect the implementation of operational turnaround plans.

It has had to renegotiate debt covenants with lenders and will meet these new covenants. While its net debt is expected to reduce in its second financial half starting in March compared with the 2026 first half, provisions are pressuring debt levels.

Provisions are money a company sets aside on its balance sheet to cover likely future costs or losses. Some of the provisions are expected retail credit losses. As a wholesaler, Spar sells goods to retailers on credit, meaning some are possibly unable to pay their debts.

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It said that for the 48 weeks ended 28 August 2026, its southern Africa business recorded modest revenue growth as wholesale volumes and trading remained subdued in a competitive consumer environment.

Spar said revenue was under pressure as consumers were struggling with higher fuel, electricity costs and interest rates.

Other updates

• The Spar Guild letter detailed there had been conflict between retailers and Spar management. Spar said it was “working closely with retailers and had exchanged views transparently, worked through practical obstacles and agreed on shared accountability”. “There is a renewed commitment to strengthening the Spar system in Southern Africa.”
• It is also repositioning its private label product, as these are usually more affordable for consumers, and said it wanted to improve margins across the value chain.
• Its delivery service SPAR2U has been refreshed in partnership with a retailer advisory group, with a pilot rollout planned for December. Spar is facing pressure from Shoprite’s on demand service Sixty60, and Spar stores convenience model –based on being close to suburbs – is under pressure as consumers turn to delivery.
• Its SAP finance software system is now live and stable at its central office and four distribution centres, three of which
  went live in early August.

Spar share price