Pick n Pay's turnaround strategy: now aiming for profitability by 2028

The group's pre-tax and capital items loss improved to R237 million for the 52 weeks ending March 2

- EDWARD WEST

PICK N Pay's turnaround is taking shape, but initial estimates predicting the retailer would reach breakeven in the 2027 financial year have proven over-optimistic. The group now forecasts this milestone will only be achieved in 2028.

The group's pre-tax and capital items loss improved to R237 million for the 52 weeks ending March 2, compared to a R1.4 billion loss in 2024. This improvement was driven by a R1bn reduction in the Pick n Pay segment trading loss, supported by a 27.3% decrease in interest paid as the recapitalisation began to impact debt service costs.

CEO Sean Summers, who announced on Monday that he has extended his contract until May 2028, said in an interview the initial target date of 2027 was an uninformed estimate. The group now has a clearer understanding of what is required to return to profitability.

Summers said that he extended his contract to ensure continuity. If he were to leave in October next year as initially planned, he would have needed to start searching for a new CEO in six to nine months, which he felt was too soon during the turnaround process.

"There are no surprises in this result; we are meeting the guidance we have provided every six months, making calm and steady progress. You cannot rely on quick wins in our situation, and it will continue to be a journey as we rebuild our institutional memory," said Summers.

He emphasised their strategy is to build "muscle memory for long-term success," saying that there would be no "quick fixes." The group now anticipates reaching trading profit breakeven in the 2028 financial year, compared to the previous forecast of 2027.

Analysts