NKD drives Mr Price’s Q1 sales growth
· Citizen
The Mr Price Group says the first quarter of the financial year ending 3 April 2027 kicked off to a strong start after reporting a 45% jump in retail sales to R13.1 billion in the first quarter (Q1). Other income grew 12.5% to R352 million.
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This performance includes the contribution from the controversial acquisition of the NKD Group. Mr Price acquired NKD earlier this year in a move that prompted jitters for shareholders, causing a massive market selloff for the retail major.
The retailer issued a voluntary update for the 13 weeks ended 27 June 2026 on Thursday. It’s likely to be a redeeming moment for the group’s management amid a bid to ensure the NKD acquisition pays off, despite skepticism.
Mr Price’s retail sales
Excluding NKD, retail sales in Africa outpaced the market and increased 3.2% to R9.3 billion.
This comes despite the retail operating environment in both African and European markets remaining unpredictable.
Prolonged geopolitical uncertainty arising from the US-Iran conflict weighed on consumer confidence, which remained negative and contributed to cautious consumer spending.
Mr Price Group remains confident
Inflation rose across both markets, reaching two-year highs in two key countries, South Africa and Germany. Higher interest rates also impacted consumers’ disposable income and willingness to spend on discretionary categories.
“Current economic conditions continue to reinforce the resilience of the value retail sector. The group remains confident that its portfolio of 16 trading chains is well positioned to outperform in its respective markets,” the group said in a Sens.
It expects trading conditions to remain challenging and unpredictable over the balance of the financial year.
Q1 performance: Africa, excluding NKD
The group reported in its 2026 financial disclosure that post-year-end trading was challenging in April, with some improvement into May.
Africa recorded retail sales growth of 2.7% in these two months combined, against growth in the base of 11.6%. Trade in June was against a weaker base of -5.1% (prior year school holiday shift from June to July).
During the period under review, South African retail sales grew 3.5% to R8.6 billion while non-South African corporate-owned store sales decreased 0.3%.
Total store sales increased 3.1% while online sales increased 4.7%, contributing 2.4% of total retail sales.
Cash sales, which constitute 87.5% of total retail sales, increased 3.1%, while credit sales increased by nearly the same.
Retail sales across the apparel, homeware, and telecoms segments all grew, helping the business exit winter in a clean stock position.
Q1 performance: NKD (Europe)
Retail sales (100% cash sales) in Europe totalled R3.8 billion.
Mr Price group said NKD outperformed both the total apparel market and the value segment in Germany, which accounts for approximately 60% of its sales
“Management is confident of achieving its annual store growth targets.
“NKD management is focused on operational excellence and delivery of strategic objectives. The process of reducing NKD’s cost of debt is well advanced,” it added.
In line with its space optimisation programme, 21 stores were closed during the period, and 23 opened, increasing the total footprint to 2 156 stores.
This article was republished from Moneyweb. Read the original here.