Spar Group's COO invests R1 million in shares amid European exit strategy

Spar's chief operating officer Megan Pydigadu has snapped up nearly R1 million worth of shares in two tranches this year as the retailer accelerates its exit from struggling European operations.

Pydigadu, who joined the grocery giant in November 2023 from technology group EOH, made the purchases as Spar reported steady progress on its five-point turnaround strategy during a challenging first half.

The executive's share buying signals confidence in the group's strategic shift toward its core South African and Irish markets, with three major milestones already achieved including the January disposal of loss-making Polish operations.

Spar completed its debt restructure in March and sold its Swiss operations in September. It also announced it would sell UK-based AWG, following a comprehensive review of capital allocation priorities.

The board believes ditching these European assets aligns with the group's strategy to focus on Southern Africa, where it's targeting a 3% operating margin, and Ireland.

Group revenue from continuing operations held steady at R66.1 billion for the 26 weeks to March, while operating profit edged up 1.6% to R1.5 billion despite headwinds from lower food inflation and post-election unrest in Mozambique.

The retailer's digital transformation is gaining momentum, with its SPAR2U delivery app recording a massive 174% surge in volumes and the Uber Eats partnership now live in 130 stores.

Southern African wholesale turnover increased 1.7%, with retail revenue up 1.9% despite store closures in Gauteng and challenging trading conditions that particularly hit middle and upper-income segments.

Build It, the group's building materials chain, bucked the trend with 4.1% sales growth and 5.4% like-for-like retail growth, while SPAR Health revenue jumped 13.7% driven by wholesale and Scriptwise gains.

Pydigadu, who describes herself on LinkedIn as a change agent specialising in professionalising organisations for growth, has experience in strategy implementation, financial restructuring and guiding companies through major transitions.

Spar’s shares were trading at R104.87 on Tuesday afternoon, somewhat down on the day.

IOL Business