JSE-listed Pepkor Holdings Limited has announced record
profit growth for the year ended 30 September 2025, delivering a strong financial performance
underpinned by diligent operational execution and the successful implementation of key
strategic initiatives. The group reported a 12.0% increase in revenue to R95.3 billion, while
operating profit increased by 13.2% to R11.1 billion.
Driven by market share gains in its core retail business and a surging performance in its FinTech
segment, the group declared a dividend of 53.0 cents per share, up 9.2%. Normalised headline
earnings per share (HEPS) grew by 23.4% to 161.0 cents, highlighting the group's ability to
generate sustainable value despite a dynamic economic landscape and while executing a
number of strategic initiatives.
Pieter Erasmus, Chief Executive Officer of Pepkor Holdings Limited, said, "We delivered record
profit growth in the 2025 financial year. These results evidence the successful execution of our
strategy to entrench our unique business model, leveraging our physical retail footprint to fuel a
digital ecosystem anchored in solving customer needs."
He adds, "We continue to build a unique position of trust among millions of our customers,
solving their needs and making life's essentials affordable and accessible. Our core retail
business outperformed the market, while our strategic focus on digital inclusion and fintech
has added scalable future growth opportunities that are now delivering tangible results."
Financial highlights
● Revenue up 12.0% to R95.3 billion
● Operating profit (before capital items) increased 13.2% to R11.1 billion
● Gross profit margin expanded by 150 basis points to 39.8%
● Headline earnings per share (HEPS) increased 14.8% to 161.0 cents (+23.4% on a
normalised basis)
● Cash generated from operations remained strong at R10.9 billion
● Return on net assets increased to 24.0%
● Dividend of 53.0 cents per share declared
● 6 000th store opened during the period
● R60 billion throughput enabled by Flash
Market-leading retail performance
Pepkor's core retail businesses delivered consistent performance, expanding market share
across key categories. Group merchandise sales increased by 8.8%, with like-for-like sales
growth of 6.5%. The group's store footprint expanded by 4.1%, surpassing the 6 000-store
milestone.
Trading in South Africa benefited from the introduction of the two-pot retirement system in the
first half of the financial year, while improved product availability and price execution
supported performance throughout the period.
PEP, the group's largest brand, increased sales by 10.8% (like-for-like +9.3%) and opened 95
new stores. The brand maintained its 'Best Price Leadership' position, gaining market share in
Babies, Kids, School, Adult and Home categories (RLC). PEP Home continued its strong
trajectory, opening 45 new stores to reach a total of 468.
Ackermans increased sales by 7.2% (like-for-like +7.1%) and ended the year with a clean stock
position. The brand achieved market share gains in the Kids category during the fourth quarter
and expanded into menswear, with plans to launch a beauty range in FY26.
The Speciality division increased sales by 8.3%. Tekkie Town delivered a strong recovery in the
second half, while Refinery expanded its footprint. The newly launched adult womenswear
brand, Ayana, was rolled out to 32 stores.
Additionally, the acquisition of Choice Clothing, implemented in June 2025, marked the group's
strategic entry into the off-price retail market, performing well in its first four months.
Lifestyle (including Rochester, Bradlows and Incredible Connection) increased sales by 7.2%,
with online sales +15%. The division continued to leverage its logistics capabilities, launching
the Skooch courier business to distribute PAXI parcels, driving efficiency.
Accelerating fintech and digital inclusion
The FinTech segment was a standout performer, increasing revenue by 31.1% to R16.6 billion
and operating profit by 52.3% to R2.2 billion.
Flash, the group's informal market platform, increased throughput by 23% to R60 billion. With
170 000 active traders, Flash continues to drive financial inclusion, increasing tapped value by
37.6% to R21 billion.
In the connectivity space, Pepkor solidified its strong market position, selling 13.5 million
handsets (+17%) and now accounting for eight out of every ten prepaid handsets sold in South
Africa. FoneYam, the group's cellular handset rental product, surpassed 2 million active
customers, effectively lowering affordability barriers to smartphones.
The A+ retail credit book increased to 3.5 million active accounts. A record 1.3 million new
accounts were added during the year, yet the group maintained a conservative credit-granting
approach, with the proportion of customers able to make purchases remaining stable at 74%.
Strategic execution and future outlook
Pepkor implemented several significant strategic initiatives post-year-end to diversify its
portfolio and expand its customer reach.
● Home expansion: The acquisition of the Shoprite furniture business (OK Furniture and
House & Home) adds scale in the furniture, bedding and appliances market. The nonRSA component of this transaction was implemented on 1 October 2025.
● Adultwear expansion: The acquisition of Legit, Swagga and Style, implemented on
2 November 2025, adds 469 stores and significantly boosts Pepkor's presence in the
adultwear market.
● Financial services: The group received Section 13(1) approval from the Prudential
Authority to establish a banking presence in South Africa. Furthermore, the acquisition
of Cloudbadger on 1 October 2025 provides a modern fintech software platform to
support this ambition.
Erasmus noted that this year hasn't been without its difficulties, but the group has continued to
grow, adapt and innovate. He says the improving economic indicators, particularly declining
food inflation and more stable electricity supply, support a positive outlook.
"In the year ahead, our focus will be on integrating recent acquisitions, consolidating new retail
formats, and expanding our digital and omnichannel capabilities. We plan to open between 250
and 300 new stores in FY26. With a strong operational base and clear strategic focus, Pepkor is
well-positioned to continue providing easy access to everyday products and services at
affordable prices," he concludes.