The retailer, which also posted an interim loss last year, is on track to achieve profitability with its new plan over the medium term, says CEO Sean Summers - and the market seems to be buying it: the share price was up by 6.3% in midday trade.

Pick n Pay is zoning in on its leadership structure, underperforming stores and operating model, and attending to its critical funding needs, after posting dismal results on Monday, 27 May.

The retailer has reported a R3.19-billion loss for the year ending 25 February 2024, which dims the otherwise stellar performance of the group's discount Boxer business.

Group turnover has grown by 5.4%, driven by Boxer, which is up 17.3%, and the Pick n Pay Clothing standalone stores, up 17%.

But gross profit was down by 3.1% year on year and trading expenses rose by almost 12%, attributable to what it said was substantially higher debtors' provisioning and R307-million of employee restructuring costs.

Trading profit was down by 87.4% to R385-million as PnP posted a R1.5-billion trading loss and Boxer made a R1.9-billion profit (up from R1.8-billion in FY23).

Most of its losses were caused by flat sales (+0.3%) at PnP, trading expenses exceeding sales growth, and a contraction of gross profit margins.

Adding to its woes is a 198.8% increase in net interest paid (to R701.8-million), due to higher gearing and increased interest rates. Pick n Pay is highly leveraged.

Combined, a loss before tax and capital items of R1.4-billion...