Africa’s largest food retailer, Shoprite, is planning to exit the Nigerian market after posting a continuous decline in sales from its operations.
In a trading update filed at the Johannesburg Stock Exchange (JSE) on Monday morning, the retail giant said it was planning to discontinue its operations in Nigeria.
“Following approaches from various potential investors, and in line with our re-evaluation of the Group’s operating model in Nigeria, the Board has decided to initiate a formal process to consider the potential sale of all, or a majority stake, in Retail Supermarkets Nigeria Limited, a subsidiary of Shoprite International Limited,” the update read.
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“As such, Retail Supermarkets Nigeria Limited may be classified as a discontinued operation when Shoprite reports its results for the year. Any further updates will be provided to the market at the appropriate time.”
In Nigeria, sales declined by 6.3 percent in the 2020 fiscal year.
Shoprite launched in Nigeria nearly 15 years ago, opening its first store in Lagos in December 2005.
That chain has grown from one to more than 25 retail stores across Nigeria — including some of the biggest retail stores in west Africa.
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Outside South South Africa, Shoprite sales grew by only 0.1 percent in the second half of the year under review.
“In equally, if not more difficult circumstances resulting from COVID-19 lockdown regulations, Supermarkets Non-RSA’s second-half reported an increase in sales of 0.1%,” the company said.
This resulted “in an overall decline in sales of 1.4% for the year but in constant currency increased by 6.6%.”
According to The Cable, the company suffered from the devaluation of the naira against the US dollar.
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