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Audited Group financial results for the twelve months ended 30 June 2024
CHOPPIES ENTERPRISES LIMITED
Registration number BW00001142508
ISIN: BW0000001072
BSE SHARE CODE: CHOP-EQO
JSE SHARE CODE: CHP
Tax Reference Number: C08710401018
("Choppies" or "Company" or "Group")
AUDITED GROUP FINANCIAL RESULTS FOR THE TWELVE MONTHS ENDED 30 JUNE 2024
The board of directors of Choppies ("Board") announces the results of the Group for the 12 months ended 30 June
2024 ("FY2024").
Continuing operations (audited) 2024 2023 Change
Pula Millions Pula Millions
Revenue 8,541 6,486 31.7%
Retail sales 8,477 6,433 31.8%
Gross Profit 1,745 1,359 28.4%
Operating Profit 321 274 17.2%
Operating margin 3.79% 4.26% (47 bps)
Profit for the period 164 150 9.3%
Profit for the period excluding Zimbabwe segment 195 158 23.4%
Basic earnings per share 8.8 Thebe 10.9 Thebe (19.3%)
Headline earnings per share 8.8 Thebe 11.1 Thebe (20.7%)
Net cash flows generated from operating activities 663 484 179
Cash and cash equivalents at end of the period 125 143 (18)
Total operations including continuing and discontinued operations
Basic earnings per share 7.6 Thebe 10.9 Thebe (30.3%)
Headline earnings per share 7.6 Thebe 11.1 Thebe (31.5%)
FY2023 per share information is based on a lower weighted average number of shares than in FY2024 due to the
June 2023 rights issue. As a result, per share earnings shows a significant reduction. The profit after tax from
continuing operations expected range is reflective of our true performance.
The Kamoso general merchandise business, Kamoso South African liquor business and Kamoso Mediland business
were discontinued during the reporting period.
Financial highlights
The Group results for the period were positively impacted by the Kamoso acquisition while the economic situation
facing the Choppies Zimbabwe segment negatively impacted results. The growths in the key performance indicators
are set out below as follows: excluding Kamoso, excluding Zimbabwe and excluding both Kamoso and Zimbabwe.
As reported - excluding As reported - excluding As reported - excluding
As reported Kamoso Zimbabwe Kamoso & Zimbabwe
% % % %
BWP millions Jun-24 Jun-23 Growth Jun-24 Jun-23 Growth Jun-24 Jun-23 Growth Jun-24 Jun-23 Growth
Revenue 8,541 6,486 32% 7,252 6,486 12% 8,000 6,083 32% 6,711 6,083 10%
Sales 8,477 6,433 32% 7,192 6,433 12% 7,939 6,032 32% 6,654 6,032 10%
EBIT 321 274 17% 294 274 7% 335 290 16% 308 290 6%
Adjusted EBIT 280 245 14% 269 245 10% 334 252 33% 323 252 28%
Profit before tax 207 165 25% 194 165 18% 229 182 26% 215 182 18%
Profit after tax -
continuing operations 164 150 9% 153 150 2% 195 158 23% 184 158 16%
Profit after tax -
discounted operations (28) 0 0% 0 0 0% (28) 0 0% 0 0 0%
Profit after tax - total
operations 136 150 (9%) 153 150 2% 167 158 6% 184 158 16%
EBITDA 622 467 33% 544 467 16% 597 479 25% 519 479 8%
Adjusted EBITDA 566 489 16% 504 489 3% 596 492 21% 534 492 9%
Notwithstanding the weak performance from the Zimbabwe segment as well as excluding the Kamoso acquisition, the
Group's performance was strong. The discontinued operations relate to businesses acquired as part of the Kamoso
acquisition and discontinued in the current financial year.
The commentary below further explains the performance of the Group.
The Group's retail sales increased by 31.8% to BWP 8 477 million (2023: BWP 6 433 million), driven by 1 new Choppies
stores, the acquisition of 108 liquor and hardware stores from Kamoso, the other segments in Kamoso and inflation
and volume growth. Choppies segments saw combined volume growth of 17% despite Zimbabwe experiencing
negative volume growth. Choppies segments achieved price growth of 0.2% mainly due to weaker translation
exchange rates. Choppies segments sales volume for like-for-like stores increased by 21.0%.
The gross profit margin declined by 50 basis points to 20.6% (2023: 21.1%), due to lower margins in the Choppies
segments due to competitor discounting and the dilutionary impact of the Kamoso acquisition which has lower
margins. Choppies Botswana, Choppies Zambia and Choppies Zimbabwe experienced lower gross profit rates while
Choppies Namibia's gross profit rate improved.
In Pula terms, gross profit increased by 28.4% to BWP 1 745 million (2023: BWP 1 359 million) despite the competitive
and challenging economic environment.
Expenses increased by 30.8% due to new stores, inflation, and the acquisition of Kamoso. Expenses excluding the
following items increased 37.3%: foreign exchange losses on lease liabilities of BWP 17 million (2023: BWP 31 million)
and foreign exchange gains on Zimbabwean legacy debt receipts of BWP 55 million (2023: BWP 11 million), the profit
on sale of the Mediland business of BWP 16 million and impairment of goodwill in the Zimbabwe segment of BWP 15
million.
Operating profit (EBIT) increased by 17.2% from BWP 274 million to BWP 321 million. In contrast, Adjusted EBIT, which
excludes foreign exchange gains and losses on lease liabilities, movements in credit loss allowances and Zimbabwean
legacy debt receipts, the profit on sale of the Mediland business of BWP 16 million and impairment of goodwill in the
Zimbabwe segment of BWP 15 million increased by 26.6%.
Net finance costs were higher than last year due to the inclusion of finance costs relating to Kamoso. Choppies
segments net finance costs reduced by BWP 11 million due to lower borrowings offset by higher interest on leases
due to new stores.
The effective tax rate of 20.8% (2023: 9.1%) is higher than last year due to the impairment of Choppies Zimbabwe's
deferred tax asset of BWP 9m (2023: raised P9m deferred tax asset) and Botswana becoming more profitable. The
rate of 20.8% is lower than the standard rate mainly due to the legacy debt receipts from Zimbabwe that are exempt
from income tax and the raising of deferred tax on carried forward tax losses in the Choppies Zambia segment. We
raised a further deferred tax asset of BWP 12 million (2023: BWP 15 million) for Zambia as we are confident that this
segment will generate taxable profits in the foreseeable future.
The Board has declared a final dividend (number 08) of 1.4 thebe per share (2023: Nil). A separate announcement
relating to the salient dates and the tax treatment of the ordinary dividend will be released on the BSE's X-News and
on the JSE's SENS.
Short-form announcement
This short-form announcement is the responsibility of the Board. It is only a summary of the information contained in
the Group's full FY2024 annual financial statements which are available on the X-News and on the JSE cloudlink at:
https://senspdf.jse.co.za/documents/2024/JSE/ISSE/CHP/CHPJUNE24.pdf and on the Group's website:
https://choppiesgroup.com/investor-relations/.
Audit Opinion
The Group's full FY2024 annual financial statements have been audited by Forvis Mazars who issued an unmodified
audit opinion. Forvis Mazars' audit report is available along with the FY2024 annual financial statements, on the
abovementioned websites. The financial information in this short form announcement has not been reviewed or
audited by the Group's external auditor, however it has been extracted from the FY2024 audited annual financial
statements.
The Company has a primary listing on the BSE and a secondary listing on the JSE.
25 September 2024
BSE Sponsoring Broker JSE Sponsor
Motswedi Securities (Pty) Ltd PSG Capital
Date: 25-09-2024 03:30:00
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