However, Spar’s net debt reduced by 40% to R5.4 billion from R9.1 billion in 2024.
One of South Africa’s largest retailers, Spar, has recorded another year of losses as it exits its Poland operations.
This is not the first international market the retailer has exited. Earlier this year, Spar began offloading its Spar Switzerland and Appleby Westward Group (AWG) business.
Spar released its financial results for the year ended 26 September 2025 on Monday, which showed mixed results for the period.
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Spar’s debt
According to the financial results, Spar’s debt has increased since 2024 because of Poland’s operations. “Southern African debt has increased since 2024 due to the business funding the exit of Poland to conclude the disposal,” reads the results.
However, Spar’s net debt reduced by 40% to R5.4 billion from R9.1 billion in 2024 and leverage improved to 1.74x. “This was primarily due to the strategic disposals of Switzerland and Poland and improved working capital management. Cash generated increased to R5.4 billion, up from R4.8 billion in the prior period.”
During the financial year, Spar continued with its strategic review of the European operations.
As part of this process, as at 28 March 2025, the Switzerland and the United Kingdom (UK) subsidiaries met the criteria for classification as held for sale based on approved disposal plans, the active search for buyers, and the expectation that the disposals would be concluded within 12 months of classification.
Completion of disposing Spar Switzerland
The results show that on 8 September 2025, the disposal of the Switzerland subsidiary was successfully completed.
“The results of the Swiss operation up to the date of disposal, as well as the loss on disposal, have been presented as discontinued operations in accordance with IFRS 5,” reads the results.
“The UK business continues to be classified as held for sale at 26 September 2025, as the group remains committed to a plan to sell this operation and an active process to locate a buyer is ongoing. The associated assets and liabilities continue to be presented as held for sale, and the financial effects of the UK operation have been presented as discontinued operations in accordance with IFRS 5.”
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Revenue increases
The results further showed comparable Spar revenue increased by 1.6% for the year, accelerating to 3.5% growth in the second half, while gross profit from continuing operations was resilient, increasing 3.3% and gross profit margin improving 20 basis points to 10.8%.
Operating expenses remained well contained, supported by lower fuel costs, enabling operating profit (excluding extraordinary items) to increase to R2.8 billion. The group’s operating margin of 2.1% was maintained broadly in line with the prior year, demonstrating earnings resilience in a constrained trading environment.
“The BWG group in Ireland remains stable and strategically valuable and delivered an operating profit margin above 3% despite the impact of wage and overhead inflation. This performance, alongside stronger trading in the second half of the year, reflects a business that remains well-positioned with strong retailer relationships and leading brands.
“This year represents a reset for SPAR. We have taken purposeful steps to reduce debt, simplify the group, improve operational efficiency and restore resilience across the group, laying a stronger foundation for sustainable growth.
“The momentum we saw in the second half, combined with improved cash generation and lower leverage, gives us confidence in our ability to restore shareholder returns while continuing to invest responsibly in the business,” said The Spar Group CEO, Angelo Swartz.
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