TM Pick n Pay Returns To Profit As Volumes Rise

Supermarket chain TM Pick n Pay returned to operating profitability in the year to February 2026, after increasing sales volumes, improving margins and maintaining tight cost control, despite subdued consumer spending and a difficult trading environment.

The retailer posted an operating profit of ZiG63.7 million in its supermarket division, a significant turnaround from an operating loss of ZiG516.3 million recorded in the previous year.

In United States dollar terms, the segment generated an operating profit of US$2,0 million, reversing a loss of US$15.9 million in 2025.

In its annual results, the retailer said the recovery was driven by disciplined execution of its business strategy, coupled with improved procurement efficiencies and prudent cost management.

This enabled it to post stronger financial and operational performance while funding expansion entirely from internally generated resources.

The improved performance came even as revenue declined by 5 per cent to ZiG12.3 billion, from ZiG12.9 billion in the previous year.

The company said the drop was offset by a 6 per cent increase in units sold, reflecting resilient consumer demand and market share gains achieved during the second half of the year.

Increased customer traffic into its stores was offset by lower average spending per shopper.

A key driver was the shift towards foreign currency sales. The proportion of United States dollar-denominated sales almost doubled during the year, averaging 45 per cent compared with 23 per cent in the previous financial year.

According to TM Pick n Pay, the higher foreign currency contribution improved procurement efficiency, enhanced stock availability and eased pressure on working capital requirements.

“In US dollar terms, operating profit reached US$2.0 million, reversing a loss of US$15.9 million recorded in 2025. Improved pricing discipline and a more stable operating environment lifted the gross profit margin from the previous year, while operating expenses rose as management maintained a strong focus on cost containment and operational efficiencies,” said chairman Fayaz King.

The retailer noted that several operating costs remain higher than regional benchmarks, although the Government’s review of selected statutory and municipal charges could provide some relief in future.

Earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 49 per cent to ZiG320.4 million, from ZiG215.1 million, with the EBITDA margin improving to 2.62 per cent from 1.78 per cent. In US dollar terms, EBITDA rose to US$10.1 million from US$7.2 million.

Loss after tax narrowed by 49 per cent to ZiG117.2 million, from ZiG228,5 million recorded in the previous year.

In US dollar terms, the after-tax loss declined to US$3.5 million from US$6.7 million, reflecting stronger underlying trading performance after the prior year’s results were affected by significant non-cash charges.

The company said its balance sheet remained robust throughout the year, with no utilisation of overdraft facilities or bank borrowings.

Capital expenditure of US$3.2 million was fully financed from internally generated cash flows, demonstrating strong cash generation.

The business also strengthened its footprint during the year with the opening of a new supermarket in Shurugwi.

More: Chronicle

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