PICK N PAY STORES LIMITED — Call Transcript 2025

Okay, are we almost ready? Okay, good morning and welcome everybody to our HYN FY 2026 results presentation. A special warm welcome, Mrs. Ackerman, good morning, welcome, Gareth, and all my colleagues from Pick n Pay, and everybody both online and here in the auditorium. It's great to have you with us this morning. As part of the introduction, I just want to quickly flip over and just give it a little bit of an overview of where we find ourselves now on our journey in Pick n Pay. It's been quite an interesting 24 months since I returned, and it's been a bit of a compacted time period. In some dimension, it feels like I never ever left Pick n Pay, but the last two years have really, really flown and gone by fast. The great thing for us is that if we have to sit and really be truly honest with ourselves and we cast our minds back about 18 months ago, not even 18 months, maybe 15, 16 months, when we put forward the business plan in May of what we were going to do in terms of restoring the fortunes of Pick n Pay, I can say with all honesty that there is not much that we would have done differently. For me, honesty, as you know, is the only thing that you can deal with in life. We continually are asking ourselves the question, are there any other levers we can find? Are there any other levers we can pull? There certainly are not. All of the levers that we've identified, all of the levers that we are busy pulling and pushing and juggling, are absolutely on track at this stage. Would we like things to be faster? In fact, I was sharing with my colleagues when we were here yesterday preparing for this, I would rather have been racing up the hill in Cape Town and the hill climb than being in the room over here, because that's how I like life. I like things to be much faster. Certainly one needs to be considered as well, because otherwise you don't get to the top of the hill. That's our journey that we're on. I think very importantly, let's jump straight into the numbers. I'd like to call in Lerena, please come up. Lerena, thank you. Thank you, Sean. Good morning, everybody, and thank you for joining us here in person and also online. Following the completion of the successful recapitalization program in our previous financial year, our focus is now squarely on operational execution. I'm very happy in this result to focus on operational metrics. The group delivered a solid result for this half. We have successfully executed across various strategic priorities. The group's turnover grew 4.9%, 4.7% on a like-for-like basis. We delivered meaningful improvement on all of the key metrics. We've improved our headline loss by 45%. This improvement was driven by a trading profit improvement of ZAR 227 million, coming from both Boxer and Pick n Pay, and it was definitely supported by the positive swing in interest of ZAR 537 million. We ended on a balance sheet that is strong with ZAR 5 billion of cash. We've again increased our segmental disclosures in this result. We've expanded some lines on the P&L that we do per segment, and we've also added for your benefit into Appendix 1, EBITDA and trading profit after leases per segment. For the purpose of this result, Boxer has already presented their results two weeks ago, so I will briefly touch on Boxer, but the focus will be Pick n Pay. Both Sean and I will focus on the Pick n Pay result. This is our primary goal, to turn the business successfully around. Our strategic priority remains growing our like-for-like sales growth across both our franchise and our own stores. For this half, our company-owned stores grew 4.8% on a like-for-like basis, and our franchise business 1.7%. What is important is that we now have three consecutive periods of continuous growth improvement. We've delivered positive like-for-like growth of 2.2%, and our internal selling price was contained at 2.1%, well below CPI food of 4.6%. I'm also happy to report that this momentum does carry through into the second half. Of specific importance for me is the improvement in our franchise issues, up 1.7%, compared to the decline of 1.4% in the preceding half. Our franchise business is extremely important to us. They remain a critical growth driver for us, and the improvement in franchise issues reflects the improvements we are making in our franchise model. Our omnichannel grew 34%, 44% up in Pick n Pay ASAP! and Mr D. Our clothing business continues to grow. They're up 12% in a very, very tough market. Hazel and her team opened nine more stores in this half, bringing the total estate to 424 stores. The Pick n Pay segment itself delivered ZAR 36.3 billion worth of turnover. That is the same number as last year. This is notwithstanding the closing of 59 stores as part of our store estate reset program. Sean will give more detail on this, but this is now largely completed with only a few more stores coming through in the second half. The actual turnover achieved reflects our relentless focus on operational and customer-facing initiatives. The Pick n Pay business is not smaller year-on-year, and as the store closures are now largely in the base, we will continue to grow into the future. As I've mentioned in my opening remarks, we have again segmented Pick n Pay and Boxer and will be presenting the results separately in this presentation. I will now take you through the results of each of them individually. The group now owns 65.6% of Boxer, post the IPO in November 2024. Our Boxer business grew turnover by 13.9% and delivered a trading profit improvement as consolidated by the group of 16.2%. They maintained a trading margin at 4.1%, aligned with the business philosophy to reinvest any gains in their customer offer. Marek and David presented these results on the 13th of October, and I would really like to congratulate them on a job well done. They are now looking like seasoned result professionals. The full Boxer result is available on their website. There we go. The Pick n Pay key metrics reflect progress across all our strategic initiatives. All of these are needed to achieve our goal of getting the business back to profit and cash flow break-even. There were two main drivers of the improvement in the Pick n Pay result. There is an interest benefit year-on-year. As a result of the recapitalization program, the number in the Pick n Pay segment is ZAR 598 million, and we had an improvement in our trading loss of ZAR 97 million. I will unpack these two individually in the following slides. The ZAR 97 million improvement in a trading loss delivered a trading loss of ZAR 621 million. Our trading margin improved by 30 basis points. This was supported by a 40% improvement in our gross profit margin, and I will unpack that in the next slide. A slight increase in our trading expenses, up 20 basis points as a percentage of turnover, and a pleasing increase in our other income, up 2.7%, supported by our increase in commissions and other income of 6.3%. This is very pleasing for us given the fact that the group's turnover was flat year-on-year. We have successfully executed our store reset program. There's only a number of stores that will still come in the future. We have avoided losses of close to ZAR 100 million in this result. These were reinvested to support building the muscle we need to create retail excellence for our Pick n Pay turnaround plan. It is very important to note that to achieve this remarkable like-for-like improvement, we needed to make sure that we've got the right skills on a store and operational level. That is what we need to ultimately deliver on our turnaround plan. In this half, we've delivered on the like-for-like sales growth. We've delivered on our gross profit margin improvement. We have reinvested the savings we've made out of the successful store reset plan in key retail skills in our business. As a result, our like-for-like expenses grew 6.2% compared to our turnover of 4.4%. That is the reason why the progress on the strategic plan is not yet making a material improvement on the trading loss in the business. We have made great progress, but we have more to do, and it will take time. We are focused on building a sustainable business. We will not chase quick wins just to make the results stronger in the short-term. We are building a long-term profitable business. As a result of this, the improvement in the trading expenses will come, but it will take time as we execute our future-fit strategic initiatives. The gross profit margin increased by 40 basis points, as I've mentioned, up to 16.9%. This was supported by key improvements in category mix, specifically in General Merchandise, Clothing, and our Fresh Range. We had a notable reduction in our waste, specifically in fresh, as in-store operations improved. We've also improved our buying and our logistic efficiencies. Notwithstanding these improvements, we also made investments. Pick n Pay is price competitive. We have achieved this while improving our customer offer. We now offer an increased range at better prices without compromising on our inventory control. We have also invested in our franchise model. We have reduced the sales margin to our franchisees to ensure that these very important partners improve their underlying profitability. The improvement of the 40 basis points on this line item is therefore a very strong achievement, considering the investments that we made during the period. Our trading expenses are up only 0.9%. This reflects the impact of the store reset plan. On a like-for-like basis, the increase is up 6.2%. The increase in like-for-like expenses was driven by the building blocks of the future-fit business. We continued selective hiring in key skills to drive turnover. We have increased store training in a focused and effective manner. We've increased brand investment. I'm sure most of you would have noticed. While we are focusing on spending in the right areas, the remaining expenses remain well controlled. As I've mentioned before, we are acutely aware of the need to ensure that our like-for-like expenses increase by a rate less than our like-for-like turnover growth, and this remains a key focus area for us. Pick n Pay's net finance cost reduced by 60% for the period. This is a result of the FY 2025 debt paydown. This, alongside a reduction in our net lease interest of 2.2%, reflecting the successful store reset plan, has really supported the year-on-year profitability of this result. The group's headline earnings per share showed significant improvement, up 56.2%. This, as I've mentioned before, was supported by the interest swing on a group level of ZAR 537 million. Two additional items impacted year-on-year comparability. We've got a 25% increase in our weighted average number of shares as a result of the rights offer in August 2024. We also now have a controlling interest of Boxer of 34.4%, post the IPO in November 2024. Excluding these items, alongside the interest saving, our headline earnings per share increased 27.8%, reflecting the trading result improvement in both Boxer and Pick n Pay. Pick n Pay ended the half with ZAR 3.9 billion of cash on balance sheet. The cash utilized from operations of ZAR 0.8 billion is in line with what we've done last year. The improvements delivered through the store reset plan were reinvested, and therefore it's reflective in the year-on-year EBITDA number being flat. To build retail excellence, we need to deliver this plan. We absolutely have to invest in these skills to drive top line across FY 2027 and FY 2028. Interest received for the year was just over ZAR 100 million, reflecting the improvement of ZAR 0.5 billion year-on-year. The working capital and CapEx movements I will unpack in the next slides. The net result was a free cash flow utilization of ZAR 0.3 billion for the year, in line with our plans. I guided at the full year FY 2025 result that we are aiming to halve the cash burn for the Pick n Pay segment of last year of ZAR 2.6 billion. We are now forecasting that the cash burn for this year will be approximately ZAR 1.6 billion. The group released working capital of ZAR 1.7 billion for the half. This is across both Boxer and Pick n Pay. This is in line with our normal H1, H2 seasonality, and this benefit will be absorbed during the second half of the year. There is some cutoff as well, but both the cutoff and the seasonality will unwind in the second half of the year. What is important to note is Pick n Pay's continued working capital improvement. Our inventory declined by 3.5%, notwithstanding the fact that our turnover year-on-year was flat and we reinvested in our ranges. There has been a continuous focus on optimizing inventory in the business. We've also seen a continued improvement in our franchise debt as the impact of the new franchise model is supporting our franchisees. I am very comfortable with the working capital levels of both Pick n Pay and Boxer. The group invested ZAR 0.9 billion during the first half of this year. Both Boxer and Clothing continue to invest to support their growth ambitions. Pick n Pay's forecasted spend for the full year is ZAR 0.9 billion. This is an increase from the ZAR 500 million of last year. The Pick n Pay spend remains measured. We are spending on key revamps where we know we can get the maximum ROI and critical repairs and maintenance. Our focus remains in investment in OpEx, in the skills we need to drive our like-for-like turnover growth. The group ended with cash reserves of ZAR 5.1 billion, ZAR 3.9 billion in Pick n Pay, and ZAR 1.1 billion in Boxer. Pick n Pay itself has got ZAR 3 billion worth of working capital facilities. These are unutilized, unsecured, and not guaranteed by Boxer. Our balance sheet is strong. It will support Boxer's growth and Pick n Pay on its turnaround path. I now hand over to Sean to take you through the operational review. Thanks, Lerena. As we see, it's definitely work in progress, and as I've said, it's a case of just steadily putting one foot in front of the other as we continue in our journey. There are just a couple of specific call-outs that I would like to make in this regard. We said that in terms of strengthening our core customer offer, we would apply a lot of our energy and effort in terms of ranging in the store, and we can see that the ranges are dramatically improved and enhanced at store level. It's one of the reasons why we are driving our like-for-like sales growth, because when you look at our absolute numbers in the total stores that we've closed over the period of time in the last two years, 18 months that we've been going at this project, we have, while we've been taking some sales out of the business in the closed stores, managed to re-inject like-for-like sales growth back into the stores again with enhanced ranging. On a quality basis, we've applied a lot of our energy and attention as to what happens at store level operationally with skills and injecting knowledge back into the business again. We can see that on the value front, from a marketing perspective, we have really, really put our strong foot forward in terms of marketing. Our relationship with FNB eBucks continues to be a fantastic relationship that we have, and all of the work that we've been doing with the Burger Fridays and the work that we do on Saturdays and Sundays and all of these promotions that we're doing has really been driving a good value proposition across the business. On the service front, we have been applying a lot of our energy and effort into training of our people again and actually getting and creating schools for blockmen, bakers, and re-getting these skills back into the company again, because these skills are not just freely available. It takes time to train these people up. A lot of focus, and you know, if you go back, Pick n Pay was always known as the Fresh Food people, and to a large degree, we had lost that. This is one of the major journeys that we're on at the moment, reinvigorating our whole fresh offering in the company and getting back onto this virtuous circle. We're starting to see the rewards coming out of this now in terms of the work that's been done under Pieter and the Fresh Food team. In terms of online and what we do with ASAP!, we relaunched the ASAP! app this year, and we have consolidated everything into the one app to make it far more user-friendly. We now have to arrange 35,000-odd products in ASAP! ASAP! continues to be a very important part of the offer that we have in the company. For those customers who want their goods delivered home, we will do it gladly with the greatest of pleasure. Our primary focus as a retailer still remains, number one, on having great stores with great product, great people, and great shopping experience as the backbone of what we do. Franchise, I'm pleased to report that our franchise has moved positively into, I think it's from about -1.4%, now up to 1.7% like-for-likes in franchise, and that's moved forward strongly. We had a fantastic franchise conference two weeks ago in Johannesburg, and I'm pleased to say that our relationship with our franchisees today is as strong as it's ever been. The changes that we've made on the franchise model are working very, very well. In general, you just get a good feeling when you go around the company and you visit with the franchisees. It's just extraordinary. We had two of our great franchisees this year that won the awards, came from STUTTERHEIM and [Würpstadt.] If you look at STUTTERHEIM, our franchise family in the area of STUTTERHEIM, they almost run that town in terms of the work that they do with council and community and everybody. It's just extraordinary to see how these families really, really operate in these marketplaces. It's just too beautiful. Our hypermarkets is another key area of focus for us, where we are really putting the real essence of hypermarkets back into hypermarket again. We're seeing great success in this regard. Some of our larger stores, where we sort of got a 6,000 sq m GL, well, not GLA, we've got 6,000 sq m trading on the floor, 5,000 sq m on the floor that we're converting this over to hypermarkets. We're putting enhanced GMD ranges back in there again, and we're getting extraordinary success with this format. I see Gareth sitting over there. Well done. We're really getting good traction there. If we look at where we are and we have a look at our acceleration in like-for-like sales, it really is extraordinary in a very, very constrained market. I think one needs to be realistic in life about the marketplace that we do operate in. It's interesting in this marketplace because at the moment we have a retail space where we're still seeing a lot of doors being opened by our competitors. One of them alone was over 300 new doors in the last year. You take that against us closing 50, 60-odd stores over 18 months. If you just have a look at the dynamic of optionality for consumers to shop elsewhere, it really is extraordinary that we've managed to grow the like-for-like sales to the degree that we have. I'm always realistic about these things. If you ask me, what is one of the real pleasant surprises that really surprised me, it's actually been our ability to show this level of like-for-like sales growth. I'm realistic about these things because you can never, ever fool yourself and end up in a sort of a fool's paradise because people tell you what you want to hear. Sometimes when you sit with suppliers, vendors, landlords, they also tell you what they think you want to hear. You need to keep your feet on the ground. We have various ways that we can read markets. There are certain market surveys and stuff that are done out there. I'm just really so astounded by the fact that our continual market share decline that we were in has in fact bottomed out, started to solidify, and is starting to move in the right direction again. That's in the market, and that's total market. That's moving into a market where we're just seeing so much other optionality that's available out there. It's extraordinary in this regard. Hopefully, this trend will continue to move forward in this direction. We obviously have some challenges in this marketplace as well. We're now coming to annualize on the two-pot release that happened last year. It's going to be interesting to see what effect that's going to have in the next weeks and months as that starts to annualize and move through. Obviously, a very tough market that we're in. In terms of establishing a future-fit business, as I said at the opening, if we went back with the benefit of hindsight and looked at what we've done in the company, what would we do differently? There would not be much that we would actually be doing differently. In all of these metrics that are over here, there are two that I'd like to specifically call out. The first one is the store estate reset, which is nearing completion. Now, it's always fascinated me how Pick n Pay closing stores has predominated in all of the media, and everything you read is Pick n Pay is closing, Pick n Pay is closing. No, we got rid of stores that were no good. That's just the simple truth of it. It is something that every single retailer does. We hadn't done enough for a long, long period of time. The journey is done. There will be a few more left that we're going to mop up at the end. The great thing here is if you have a look at 27 of the stores that were originally identified, they have actually either turned to profit or are coming back, getting close to turning to profit again. Even at a break-even level, at a store level, it still contributes to the center. This thing is neither. It's a very dynamic process, and it's not necessarily linear or binary. This journey is done. From here on in, as we review leases as they come up, we will continue to assess each lease on a store-by-store basis. In some places, demographics change, the center of what's happening, a taxi rank moves, stores are now rendered no longer in the right place, and that'll just be part and parcel of what we do. I'm pleased to say that this is basically done, which is fantastic. The other really great one is our strategic supplier partnership that we have here. As we know, our eSport distribution center, which is the most extraordinary facility. As I said to Marcel, I think Marcel, I saw you walking in earlier. There's Marcel sitting there. As I said to Marcel in the beginning, don't be defensive of this, Marcel, because in the brief that you were given, you achieved 11 out of 10. You built a magnificent facility there. Unfortunately, for the wrong company, it was too big, way too big. I'm pleased to say that we've signed our MOU with DP World, and the eSport facility has now moved off to DP World, and we will be getting those savings and start to get those savings almost with immediate effect. It's an extraordinary job of work that has been done, and I'm pleased to say that eSport is now currently almost fully utilized because they have the ability to put some of their existing clients that they have into the building, and some of those people are in fact Pick n Pay suppliers. It's even more efficient because the stock is now actually in the building. It's a win-win across all the pieces of work that we're doing there. That's another fantastic, huge piece of work that we've got done and ticked off. Our digital transformation, and the reason why I call this out is just simply that there's a lot of talk around what is going on in this marketplace in terms of digital transformation and retail media and all of this. We've been in this for ages. In fact, we started selling our data at the end of my days in my previous life at Pick n Pay already. This is nothing new. It continues to evolve. It's a very, very important part of the business, and we will continue to grow this. In all of these areas, retail media and data analytics for our suppliers, this we will continue to grow. As we do, Smart Shopper, very, very important to us. It's a key part of our business, as I said before. Obviously, our value-added services. We've received quite a lot of rewards and awards and accolades for the advertising and marketing that we've done. I think you will see in the company that our marketing is a lot crisper, it's a lot clearer, and it's a lot more targeted and directed than it used to be. Clothing, our clothing continues to perform fantastically and just extraordinary, where Pick n Pay has really found a segment in the marketplace that Hazel and her team have clearly really been able to identify what it is that their customers are looking for in terms of value and in terms of fashion, and it continues to grow strongly. Boxer, Marek and his team have, they've just done the most extraordinary, extraordinary job of work. As you say, Lerena, they're now experienced results and roadshow presenters. Marek phoned me this morning to wish me well because he had a week like I'm going to have two weeks ago. Boxer truly is an absolute, absolute gem. They're just in the right spot and their virtuous circle is incredible. To Marek, to you and your entire team, all I can say is well, well done, my friend. We're very, very proud of you and very privileged to have you as a part of us. Supporting our communities, notwithstanding the fact that we are busy working our way back into the sunshine and busy working our way back into profit, we have doubled down on our efforts in terms of what has always made Pick n Pay what it is. When Raymond and Wendy started Pick n Pay, there was always the fundamental belief that this is a company for the people, by the people, and that you invest in society, you invest in community, and it is something that we have doubled down. You know, we have a CSI WhatsApp group, and I'm just astounded every week, every weekend during the week at the updates that just continually get flicked through, where right across the length and breadth of this country, our people just do the most extraordinary acts of help, of reaching out to community and supporting people in need. It's really magnificent. This has been one of the really wonderful things for us and a great privilege for us to have been a sponsor of the Springbok. You know, at the start, it was always a case of the Springbok being the one thing in this country that unites South Africa and pulls South Africa together, because if ever this country needed to start pulling together, it's now. That's why for us, in the first instance of the Springbok, it was more than just about sponsoring the Springbok. It was a symbolism of actually taking what it is that unites this country and brings it together and also making a statement that Pick n Pay is here. Pick n Pay is going nowhere. As we say, South Africa, we've got your back, and hopefully South Africa's got ours and is starting to show in the footfall in the stores. More importantly, it's not just about sponsoring the Springbok. It's about the work that's been done at grassroots level in rugby. We don't realize just how important rugby is amongst the youth in this country today. You can go across the length and breadth of South Africa and see how rugby is really becoming a force for good and a force for getting the country together. We're massively involved down at the grassroots level in rugby as well. It's fantastic. Just a couple of closing remarks here. As I said in the beginning, our strategic priorities that we put in place, we've kind of been working our way through them, and we've got most of it ticked away. When we look at leadership and people, there's still obviously the issue of succession. I'm still here for another two and a half years, and it is something that is top of mind for us. We're busy working at all of our succession programs in that regard. Also about building leadership within the company from within the company again, because that's what retail is. It's about growing your own people. Accelerating our like-for-like sales, as I said, we're still working hard at that, and we'll continue to work hard at that. We continue to strengthen our partnerships across the Board and to work with our landlords very, very importantly, and to make sure that that moves in the right direction, as well as our supplier base. We reset the store estate. That's kind of done. The future-fit structure is still work that is underway. That's having a look at what are our store OpEx structures, what are our support OpEx structures, and those are things that are just work in motion as we go forward day-to-day. I really just want to thank all my colleagues in the company that I'm privileged to work with and to be a part of. I can feel, you know, I had an interview with Alec Hogg before I came here earlier this morning. Alec asked me, you know, what does it feel like, Sean, when you're going to the company, when you're going to the stores, compared to when you came back two years ago? I think that I can say without any fear of doubt that this is a different company today. Are we where we want to be? Hell no. Are we well on the way on this journey? Absolutely. I've said before, this is like climbing Mount Everest. I said our journey is up Mount Everest. Alec asked me this morning, if you think of Table Mountain and not Mount Everest, where are you in Table Mountain? I said, Alec, we're solidly at the cable station at the bottom there. We've bought our ticket, and the cable car's on the way. We know where we're going, but we've got a journey to get there. We know what it looks like. We know how to get there. I want to thank everybody for their support, not only the people inside this company, but very, very importantly, the investors in this company who stay the hall with us, stay the long haul with us, the family, Wendy, Gareth, the Ackerman family, for the support that they've given, both myself and the company. It's a great privilege to stand here as CEO of this wonderful organization. Thank you very much. I don't know if there are any questions. Yes, sir. Can you hear me? I'll speak for now. Yeah. Thank you, Sean, Lerena. First of all, well done on the great work you've done so far in this later on strategy. It's been difficult decisions to make along the path. I think for the first one, you've mentioned a lot of you want to add new skills into the, or reintroduce the skills into the business. Could you elaborate on what skills you're looking for, what positions, and then how far along that journey are you? Do you still have a lot more people to hire? Yeah. The whole issue of skill, you know, retail is, it's a beautiful business. When you ask yourself the question, where do you find retailers? I mean, you can't go to a college, you can't go to a university and go and find retailers. Retail by its very nature is something that you learn on the job. We had, for a protracted period of time, done away with all of our training modules and our trainee manager programs that we had in place. Tembi's over here. Tembi heads up People for the group. We've reinstated all of these things back in. One day Wendy asked me the question, just put in sort of not simple terms, Wendy, but Wendy said, Sean, just try and give me an understanding of what's really happened in Pick n Pay. I said, I'll give you an analogy that Raymond would understand because he was a keen golfer. In years by, if we went to our stores, our leadership teams in store levels were all good single handicap golfers. Today you go into stores and there are most probably 16, 18 handicaps, 20 handicap golfers. You can't blame the people because everybody starts, if you play golf, you start with a really lousy handicap and then you work on improving it. It's exactly the same in retail. It takes time to reinstall and reinstate these skills at store level. It's an operational thing at store level. It's a case of ownership that managers truly understand. This is my store. I take total responsibility for it. You've got to find great bakers, great butchers, good blockmen, because these are the skills and the artisans that one needs to put back into the business again. Otherwise, what are you? You're not really doing a great job. We have to reinstate and rebuild all of those skills back into the business. We're making really good, solid progress now of creating these bases where we've taken in every single region now, we have identified stores where we're doing butchery training, bakery training. You've got to train these people and then you've got to make sure that they stay. You have to create an environment that makes sure that it's conducive for them not only to learn the skills, but that they don't get poached and leave. You've got to create an environment where they want to stay as well. Somebody said to me once that, you know, you spend a lot of money on training. You know, is it really sort of, you know, worth it? I said, yeah, I think so. They said, what happens if you train them and they leave? I said, what happens if you don't train them and they stay? It's an investment that one needs to make, and we're on that journey. Just on the franchise, the franchise is starting to pick up. Yeah. We heard there was a new agreement that came in about a year and a half ago. Now there's another new agreement. What are the changes you've been making to reinforce that growth? The changes fundamentally for the franchise in that agreement really are just dealing with widening their margin. It's giving them more of a margin of profit for the individual franchisees and operators. When we have a look at our aging debt and stuff in franchise, we've got hold of that. It's in a much better way around than it has been for a long, long time. That's all to do with the health of their income statement at franchise level. That's where we've been applying a lot of attention. No further questions. Anything online? Tam, yes. A question from Paul Stehers. What is your outlook for Pick n Pay internal inflation for the remainder of the financial year? We're sitting at the moment at about 2.1%. Lerena, is that right? I forget. I have so many numbers in my head at the moment. We're sitting at about 2.1% at the moment. I think that one may see that there's certain commodities like rice and maize that are in fact coming down, which means that poultry prices should also come down. I think that inflation may actually go down. I think it may get closer to 1%. In some of the basic categories, you may even see it getting closer to a bit of deflation. If you look at the GDP, what is the GDP? It's about 0.6%. You clever people in the room should know this. I think that the forecast was to be circa 2.2% or 2.3%. We can look just from that perspective as well as not only inflation down, which obviously creates another level of challenge for us, but the GDP is also down. I come back to this really, really constrained market. This market is tough. When you sit and speak to the major manufacturers, and I spend a lot of time talking to the big suppliers, all suppliers, for them, they look at the total market. If you speak to the two sugar suppliers, you've basically got sugar done. When you have a look at the total market and the dynamics that are there, there are certain categories in this country where people are trading down dramatically. We can see it in Boxer, where we can have a look at the profiles of what protein is being bought there. You can see that things like Russians, Viennas, Polonies, you can see how those are just soaring in terms of sales because people are just battling to afford normal protein, red meat and chicken. These are dynamics. The market is really constrained. Inflation, I think, will actually go down, not up, would be my prediction. Another question from Paul Stehers. Please, could you explain how you calculate your like-for-like growth for Pick? Do you strip out those stores that are to be closed or converted to Boxer? Yes, those come out, and like-for-like sales is purely like-for-like stores. That gets stripped out. Sorry, Lerena. Sean, you pass the desk. Checking with the headmistress here. Just checking with the headmistress, my Chief Sales Prevention Officer. This is. A question from Titanium Capital. The Pick n Pay gross margin is 16.9%. Can you please provide a separate gross margin percentage for corporate and franchise operations? No. You know, there's levels. When we come to segmental disclosure, there's levels that one goes to. I know that you'd like to have the P&L for every single service area and every single store and build it up from there, but that won't be happening anytime soon. Noted. From Reuters. Could you please explain when the group expects to reach break-even and how this will be done? Our guidance is for us to get to those objectives by FY 2028. It will be done through the initiatives that actually are still projected on the slide. It effectively looks to growing the business through like-for-like sales as a first step. As I think both Sean and I have mentioned, the store closures are now largely in the base. From now on, one would start to see positive sales growth momentum. We have just improved our gross profit margin, and we do believe there is more to be had as we go on the journey. There are the initiatives across the entire expense base. The MOU that we've just signed with DP World is a very, very important strategic pillar. We expect to see those efficiencies coming through over the next 24 months as they unfold. It literally is driven by each of our future-fit initiatives. I think importantly, Lerena, to add to that, our margin has widened this year by the amount that it has. We've given more margin to our franchisees and we're absolutely price competitive in the marketplace. If you look at the independent pricing surveys that have been done, they all absolutely bear that out. It's not us marking our own homework, which would show you that 18-odd months ago, when I returned here 24 months ago, our buyers and merchants in the company were more focused on recovering money than actually trading. I said this must come to an end. We must get back to trading and buying and selling and doing what buyers should be doing. I think that this is most probably the greatest manifestation of the success that's been had in that regard. We're just back to being good basic retailers again when it comes to buying and selling. Question from David Fraser at Peregrine. From a strategic point of view, do you envisage holding onto the Boxer stake indefinitely or would you consider unbundling it down the line? We are very, very happy with the Boxer performance, and we are very, very happy to own 65.6% of Boxer. As a matter of fact, you know, we would have loved to have still 100%. We are definitely very happy with the performance and what the team is delivering for Pick n Pay shareholders. Another question from Cabela Moshecha. Post the completion of the hiring process, will the like-for-like employee cost growth revert closer to inflationary levels? Is there more investment required post this period? I think the way you need to think about it is our objective to get our like-for-like expense growth below our like-for-like turnover growth. That is what our key initiatives will deliver, and that will include efficiencies in employee costs. Sean spoke to support office initiatives, looking at efficiencies in store, et cetera. As this unfolds over the period of the plan, you would see that like-for-like number coming down. A question from [Priyotha Drozd] from Varushan Fund Management. Would you be willing to consider a Pick n Pay share buyback as the turnaround strategy continues delivering results? I think where we are currently, we are focusing on our target to get the business to cash flow break even. Once we have achieved that, one will consider future options. I think one must also add to that that as we get back into a stronger financial health and cash generative again, we need to continue investing inside the company and getting our estate back to the condition that it needs to be in. Question from [Kuba Salir] from Value Capital Partners. Wanted to know something about the overlaps between Pick n Pay and Boxer. Given the procurement processes for the two companies are independent, are there any specific important overlaps between the two entities? No. One of the things that we did is drew a real clear line between what Boxer does and what Pick n Pay does. Boxer's philosophy, how they buy, how they go-to-market, is so far away from what Pick n Pay does. We don't want to mix. We don't want to confuse that in any way, shape, or form. On a piece of paper, sometimes these things look like they make sense. In reality, when you actually come to implement it, it doesn't work. Another question from Paul Stehers. Please talk to the additional investments you have to make that cause Pick segment loss to not improve in FY 2026 versus FY 2025. I mean, I think we have discussed them now in the Q&A. Largely, a lot of them will definitely be the key skills we need at an operational level to ensure that the in-store execution keeps on driving our like-for-like sales. Question from Ya'eesh Patel at SBG Securities. Please, can you speak to the CapEx cadence in the Pick n Pay stable? Is there not an element of underinvestment which could bite over the medium-term? How should we think about this? We are very, very careful to ensure that we spend where we get returns. The question is a very valid one. We also need to make sure that our operational excellence on a ground level is established to ensure that we get the returns. We are measured still in our spending, but we have got the ZAR 3.9 billion on balance sheet, and where we believe that it can unlock returns, we will definitely spend the money. I think another point to that, Lerena, is it's not just about spending money on stores. You know, you can build the greatest brand new, swanky store, but if you don't have the right people in the store and the product's not there, you're still not going to do the business. It's not that the whole of the Pick n Pay real estate is broken. Not at all. I mean, we have a lot of great stores in this company. Certainly, there are some key stores that need some work done to them. That is an absolute fact. I mean, there's also a big chunk of our estate that's great. We mustn't have a look at Pick n Pay and think that the whole thing is broken. It ain't. Another question here. What is your view on the amount that is being spent on online gambling and its impact on disposable income? This is a really, really current topic, and one can see that there's been commentary from virtually every financial institution. There's been so much talk about it. I think context is always important. If we have a look at the, I don't know, ZAR 1.6 or ZAR 1.7 trillion that is churned over in the space of gambling in South Africa, there's somewhere north of about ZAR 70 billion that is being taken out of this market at the moment in terms of profits that are being taken in the gambling industry, the bulk of which is in the online gambling space, not in the casinos and horse racing and the like, where employment is created, at least in casinos. You've got hotel rooms and crew pairs and cleaners and all of that. In the horse racing industry, you've got a whole industry there. If one looks at online gambling, they don't create any jobs. These program writers are all sitting in other places offshore. ZAR 70 billion a year. If you think of ZAR 70 billion a year, that's basically Pick n Pay's total revenue. We're still a big company. It's the equivalent of everything that's sold by Pick n Pay. It's taken out by a few people in profit every year in a highly constrained market. It's over ZAR 1 billion a week is just being hoovered out of the economy. It's difficult. On a lot of the research work that's been done by some of the institutions, it would appear that north of 20% of SASSA grants are going straight into gambling. It's horrendous. It's horrendous. Now, how does one deal with it? Smoking was a cancer, and then one of the ways that they dealt with it was that they banned all marketing and promoting of cigarette products and tobacco products. I think we need to give serious consideration in this country to a similar move, that all marketing and advertising should be banned forthwith, the same as you did with smoking. It's not a crazy thought. You look in Europe, in Belgium, Holland, Italy, there's no marketing of gambling. It's illegal. Even if you look in the United Kingdom, from next year it now will be not possible to put a gambling logo on the front of a soccer jersey. Even in countries like the U.K., it's starting to move. I think this is an industry that is totally out of control. I think that the poor and the vulnerable, and you know, even kids, I mean, all you need is your mom and dad's ID number, sign up on the app, put in the ID number, and you're off to the races. I speak to people that are teachers at schools and what have you, and they tell me about the stress that's happening amongst kids, where kids are sitting at school gambling on the apps on the phone. It's a problem. It's a huge problem. I think a serious consideration needs to be given to what is actually happening inside society in this regard. It's not just about the greed of chasing the profit. A question from Nick Webster at HSBC. There's no mention of liquor performance in the presentation. Could you give us some color here, and if it's accretive to the Pick n Pay like-for-likes? Yeah, Pick n Pay liquor like-for-like sales continue at a similar pace as the rest of our like-for-like sales, and liquor continues to grow. It's also a fantastic category for us. We just wanted in this presentation not to get too granular in terms of calling out everything and just really get to the headline stuff that really people want to know about. That is what's happening to the core underlying Pick n Pay at a top line level. Another question from Johannesburg. What is your opinion on Walmart entering the South African market? What do you believe will be the impact on S.A. retail in the short-term? I think it came about 17 years ago, 16 years ago, didn't they? They arrived here 16 or 17 years ago. It's not like they've just arrived and cleared customs. I know it's quite slow to get through the airport, but they've been here for a while. It would appear at this stage, and one is never sanguine about these things because they obviously are a mighty force globally. From the stores that we've seen that have been identified, it's more of a rebranding exercise than anything else. It would appear that there's some of the real estate that they'll rebrand, and we'll keep an eye on them. They've always been here, always been here. Another question from Ya'eesh Patel at SBG. Please, can you speak to any dynamics over the past six months in the chicken category? Any shortages for Pick n Pay experienced? Yeah, we had the problem with the MDM issue out of Brazil because, you know, a lot of product that comes into this country, MDM is the backbone of what happens for the lower-end proteins, Russians, Viennas, Polonies, and all of that. That has a profound effect on that. Obviously, chicken feet as well is a massive piece of the market for Boxer and the like, and even in some of our Pick n Pay stores. On poultry in general, you know, we had the foot-and-mouth issue on red meat. We had a spike in red meat prices, which obviously then put more pressure on poultry. We had poultry shortages. The poultry market has been under a lot of pressure as well. Question from [Keenan] at Investec. Are you seeing a highly promotional environment in Pick n Pay Clothing? You know, the clothing market is interesting because obviously you've got our friends from Shein and the like that are sort of playing silently in this space, but growing enormous volumes in this country, absolutely enormous volumes. If we have a look at our clothing offer within Pick n Pay, we're really not that promotional because, I mean, when I say we're not that promotional, we have a value proposition and we present fair value to the consumer. Our clothing is not massively price-driven. The textile market, as you know, you can see from the results of the other retailers, has been under pressure in the last while. It's going to be interesting to see, as I say, as we annualize through the two-pot system now, because a lot of the two-pot spending that actually went back into the market didn't really go into food. A lot of it went more into sort of clothing and housewares. Let's see how that annualizes out. Question from Thishan Govinder, at Truffle Asset Management. Any guidance on when core Pick n Pay is expected to be free cash flow neutral? What is the top line like-for-like, gross profit margin, and OpEx needed to get there? Shall I just pull out my spreadsheet, Sean? Yeah. It's in the dictionary under N. Our guidance remains on the full cash burn for the Pick n Pay segment towards FY 2028. Ultimately, the way you need to think about it is that we need to get our trading profit after lease margin to zero. To do that, about half we believe will come from our gross profit and the other half from our trading expenses. A question from Citi. Can you provide some color on clothing post-period trade? Our clothing post-period trade continues to show the similar trend pre. We haven't seen any marked drop-off from before. We're really, really happy with the progress that Hazel's making, the new stores that are opening. From an excess merchandise markdown perspective, we've really done a great job of getting ourselves a lot more efficient and cleaner in that area. We're very positive about where we are at the moment in our clothing business. Obviously, the Springbok Apparel and Merchandise is another great thing for us in that area. We do an unbelievable amount of business in Springbok Apparel and Merchandise. I have two more questions. One from Daniel at Ashburton. Could you speak to the outlook for cost growth into H2, including Boxer? Boxer will continue to grow as they're opening their store estate. You will see similar levels of growth in the Boxer business. I think the Pick n Pay shape will also reflect the first half. A last question from Nick Webster at HSBC. Could you comment a bit more on your enhanced private label offering in terms of categories and current penetration to Pick n Pay? Yeah, certainly. We've done a lot of work in the last while of cleaning out a lot of house brand product that was in store that was not particularly well conceived at the point in time when those ranges are put together. We've taken No Name brand again, and again we've cleaned up the No Name and brand range. We've got a lot of items that should never have been a No Name and brand. No Name and brand was always understood to be in certain categories and in certain commodity groups and present a certain value profile to our customers. We're busy refocusing that again at the moment. We've got new packaging that's going to be coming forward that will be taking us and really putting No Name brand back as the hero that it should be and a very, very well-known house brand in the country, one of the leading ones. On the Pick n Pay brand specifically and Live Well, there's work that's been done behind the scenes there as well. As I say, we've been getting cleared of a lot of product that was just not really serving the purpose that it should serve. I think within the next 12-18 to 24 months, you will see quite a radically revamped and repositioned house brand range in the market. Our front door always in this company has been branded goods, you know, at prices really low. That's always been the key hallmark of our success in the company, and that's our backbone. Your house brand sits on the side of that and performs a very, very important function. Obviously on the other side of that is Fresh, which obviously a lot of that is house brand just by nature, but a massive amount of energy and effort going into Fresh. A lot of stuff happening. Come in from David Fraser at Peregrine. Is Pick n Pay core profitability during or at the end of 2028? During. Morning, David. Hi. It's Chris Logan. Very well done on all the notable improvements. If we consider the competitive environment you faced with and your trading expenses as a percentage of sales at 22.2%, they're very high historically, and they're high in relation to your GP of 16.9%. Are you not going to need to take more radical steps to get your trading expenses in line? You see, the critical thing, and thanks for that question, because that's the vital journey that we're on. The two key metrics in this business obviously are your top line sales and then your margin, and then obviously your trading expenses. Your trading expenses, if you look at your trading expenses, a lot of them are not that variable. When you take cost of occupancy and rates and taxes and rents and all of those kind of things, a lot of that outflow, the only real variable you got there is kind of sort of your wages and stuff that you know you can flex. Yeah, it's absolutely the nub of where we are. Top line is everything because if you lose the momentum on the top line, there's no way that you can cut your expenses as a rate to offset loss of momentum at the top line level. That's why one of the constraints currently in this marketplace is top line sales. I don't sit here, we don't sit here in Kenilworth and have this set of circumstances, the macroeconomy looking at us. Our colleagues down over the hill over there, or nearer to that side of the mountain on the other side over there, they have a different set of dynamics. They're operating in the exact same market that we're operating in. These things are common to all. The pressures we feel, they feel as well. You see, our expenses, if we can get our top line growing at the rate that can continue to show these trends, your expenses of your wage expense and your fixed cost expense all comes down as a proportion of it. The work that we are doing currently to do the OpEx reset, to have a look at the store labor reset and all of that stuff that we're doing, this is all work that's happening quietly behind the scenes. It's ongoing. It's ongoing. Sure. Good luck. Thank you. We just need your support in the store shopping with us, and then it'll help us get there. Sorry, Sean, one more question. Is the group break even including Boxer for the full year? It's specifically focused on Pick n Pay. Okay. The last question, can you clarify if the full year guidance for F 2026 is on the trading profit pre-leases level? It is on the trading profit pre-leases level. And that's it from [Joburg]. Okay. Yes, sir. One of the important slides you presented are the social welfare benefits you bring to the country. Why isn't this more promoted? I mean, with all the problems you're resolving, don't you think we should be more aware of the benefits you're bringing to the society? Good question from one of our faithful long-term shareholders, private shareholders. We appreciate it, and I appreciate that question. You know, there's a famous saying in life that the hand of the receiver should never know the hand of the giver. It's something that we also believe in in the company. I think just to continually quietly invest in community and do what you do creates far more long-term loyalty and sincerity with the communities that we deal with because I know that we're there for them. It's always been a philosophy of ours and a belief of ours that we just quietly get on with it, and we just change lives in communities. In fact, we've got Suzanne sitting here. She's been at the forefront of a lot of this too, and a lot of that instilling that culture into the company. Doing good is good business, as our Chairman taught us, Chairman and Founder. Thank you very much indeed. Wish you all the best. Have a great week. Mine's going to be spectacular. Thank you.

Speaker 6: Okay, are we almost ready? Okay, good morning and welcome everybody to our HYN FY 2026 results presentation. A special warm welcome, Mrs. Ackerman, good morning, welcome, Gareth, and all my colleagues from Pick n Pay, and everybody both online and here in the auditorium. It's great to have you with us this morning. As part of the introduction, I just want to quickly flip over and just give it a little bit of an overview of where we find ourselves now on our journey in Pick n Pay. It's been quite an interesting 24 months since I returned, and it's been a bit of a compacted time period. In some dimension, it feels like I never ever left Pick n Pay, but the last two years have really, really flown and gone by fast. Okay, are we almost ready? okay are we almost ready Okay, good morning and welcome everybody to our HYN FY 2026 results presentation. okay good morning and welcome everybody to our hyn fy 2026 results presentation A special warm welcome, Mrs. Ackerman, good morning, welcome, Gareth, and all my colleagues from Pick n Pay, and everybody both online and here in the auditorium. a special warm welcome mrs ackerman good morning welcome gareth and all my colleagues from pick n pay and everybody both online and here in the auditorium It's great to have you with us this morning. it's great to have you with us this morning As part of the introduction, I just want to quickly flip over and just give it a little bit of an overview of where we find ourselves now on our journey in Pick n Pay. as part of the introduction i just want to quickly flip over and just give it a little bit of an overview of where we find ourselves now on our journey in pick n pay It's been quite an interesting 24 months since I returned, and it's been a bit of a compacted time period. it's been quite an interesting 24 months since i returned and it's been a bit of a compacted time period In some dimension, it feels like I never ever left Pick n Pay, but the last two years have really, really flown and gone by fast. in some dimension it feels like i never ever left pick n pay but the last two years have really really flown and gone by fast The great thing for us is that if we have to sit and really be truly honest with ourselves and we cast our minds back about 18 months ago, not even 18 months, maybe 15, 16 months, when we put forward the business plan in May of what we were going to do in terms of restoring the fortunes of Pick n Pay, I can say with all honesty that there is not much that we would have done differently. For me, honesty, as you know, is the only thing that you can deal with in life. We continually are asking ourselves the question, are there any other levers we can find? Are there any other levers we can pull? There certainly are not. The great thing for us is that if we have to sit and really be truly honest with ourselves and we cast our minds back about 18 months ago, not even 18 months, maybe 15, 16 months, when we put forward the business plan in May of what we were going to do in terms of restoring the fortunes of Pick n Pay, I can say with all honesty that there is not much that we would have done differently. the great thing for us is that if we have to sit and really be truly honest with ourselves and we cast our minds back about 18 months ago not even 18 months maybe 15 16 months when we put forward the business plan in may of what we were going to do in terms of restoring the fortunes of pick n pay i can say with all honesty that there is not much that we would have done differently For me, honesty, as you know, is the only thing that you can deal with in life. for me honesty as you know is the only thing that you can deal with in life We continually are asking ourselves the question, are there any other levers we can find? we continually are asking ourselves the question are there any other levers we can find Are there any other levers we can pull? are there any other levers we can pull There certainly are not. there certainly are not All of the levers that we've identified, all of the levers that we are busy pulling and pushing and juggling, are absolutely on track at this stage. Would we like things to be faster? In fact, I was sharing with my colleagues when we were here yesterday preparing for this, I would rather have been racing up the hill in Cape Town and the hill climb than being in the room over here, because that's how I like life. I like things to be much faster. Certainly one needs to be considered as well, because otherwise you don't get to the top of the hill. That's our journey that we're on. I think very importantly, let's jump straight into the numbers. I'd like to call in Lerena, please come up. Lerena, thank you. All of the levers that we've identified, all of the levers that we are busy pulling and pushing and juggling, are absolutely on track at this stage. all of the levers that we've identified all of the levers that we are busy pulling and pushing and juggling are absolutely on track at this stage Would we like things to be faster? would we like things to be faster In fact, I was sharing with my colleagues when we were here yesterday preparing for this, I would rather have been racing up the hill in Cape Town and the hill climb than being in the room over here, because that's how I like life. in fact i was sharing with my colleagues when we were here yesterday preparing for this i would rather have been racing up the hill in cape town and the hill climb than being in the room over here because that's how i like life I like things to be much faster. i like things to be much faster Certainly one needs to be considered as well, because otherwise you don't get to the top of the hill. certainly one needs to be considered as well because otherwise you don't get to the top of the hill That's our journey that we're on. that's our journey that we're on I think very importantly, let's jump straight into the numbers. i think very importantly let's jump straight into the numbers I'd like to call in Lerena, please come up. i'd like to call in lerena please come up Lerena, thank you. lerena thank you

Speaker 4: Thank you, Sean. Good morning, everybody, and thank you for joining us here in person and also online. Following the completion of the successful recapitalization program in our previous financial year, our focus is now squarely on operational execution. I'm very happy in this result to focus on operational metrics. The group delivered a solid result for this half. We have successfully executed across various strategic priorities. The group's turnover grew 4.9%, 4.7% on a like-for-like basis. We delivered meaningful improvement on all of the key metrics. We've improved our headline loss by 45%. This improvement was driven by a trading profit improvement of ZAR 227 million, coming from both Boxer and Pick n Pay, and it was definitely supported by the positive swing in interest of ZAR 537 million. We ended on a balance sheet that is strong with ZAR 5 billion of cash. Thank you, Sean. thank you sean Good morning, everybody, and thank you for joining us here in person and also online. good morning everybody and thank you for joining us here in person and also online Following the completion of the successful recapitalization program in our previous financial year, our focus is now squarely on operational execution. following the completion of the successful recapitalization program in our previous financial year our focus is now squarely on operational execution I'm very happy in this result to focus on operational metrics. i'm very happy in this result to focus on operational metrics The group delivered a solid result for this half. the group delivered a solid result for this half We have successfully executed across various strategic priorities. we have successfully executed across various strategic priorities The group's turnover grew 4.9%, 4.7% on a like-for-like basis. the group's turnover grew 4.9% 4.7% on a like-for-like basis We delivered meaningful improvement on all of the key metrics. we delivered meaningful improvement on all of the key metrics We've improved our headline loss by 45%. we've improved our headline loss by 45% This improvement was driven by a trading profit improvement of ZAR 227 million, coming from both Boxer and Pick n Pay, and it was definitely supported by the positive swing in interest of ZAR 537 million. this improvement was driven by a trading profit improvement of zar 227 million coming from both boxer and pick n pay and it was definitely supported by the positive swing in interest of zar 537 million We ended on a balance sheet that is strong with ZAR 5 billion of cash. we ended on a balance sheet that is strong with zar 5 billion of cash We've again increased our segmental disclosures in this result. We've expanded some lines on the P&L that we do per segment, and we've also added for your benefit into Appendix 1, EBITDA and trading profit after leases per segment. For the purpose of this result, Boxer has already presented their results two weeks ago, so I will briefly touch on Boxer, but the focus will be Pick n Pay. Both Sean and I will focus on the Pick n Pay result. This is our primary goal, to turn the business successfully around. Our strategic priority remains growing our like-for-like sales growth across both our franchise and our own stores. For this half, our company-owned stores grew 4.8% on a like-for-like basis, and our franchise business 1.7%. What is important is that we now have three consecutive periods of continuous growth improvement. We've again increased our segmental disclosures in this result. we've again increased our segmental disclosures in this result We've expanded some lines on the P&L that we do per segment, and we've also added for your benefit into Appendix 1, EBITDA and trading profit after leases per segment. we've expanded some lines on the p&l that we do per segment and we've also added for your benefit into appendix 1 ebitda and trading profit after leases per segment For the purpose of this result, Boxer has already presented their results two weeks ago, so I will briefly touch on Boxer, but the focus will be Pick n Pay. for the purpose of this result boxer has already presented their results two weeks ago so i will briefly touch on boxer but the focus will be pick n pay Both Sean and I will focus on the Pick n Pay result. both sean and i will focus on the pick n pay result This is our primary goal, to turn the business successfully around. this is our primary goal to turn the business successfully around Our strategic priority remains growing our like-for-like sales growth across both our franchise and our own stores. our strategic priority remains growing our like-for-like sales growth across both our franchise and our own stores For this half, our company-owned stores grew 4.8% on a like-for-like basis, and our franchise business 1.7%. for this half our company-owned stores grew 4.8% on a like-for-like basis and our franchise business 1.7% What is important is that we now have three consecutive periods of continuous growth improvement. what is important is that we now have three consecutive periods of continuous growth improvement We've delivered positive like-for-like growth of 2.2%, and our internal selling price was contained at 2.1%, well below CPI food of 4.6%. I'm also happy to report that this momentum does carry through into the second half. Of specific importance for me is the improvement in our franchise issues, up 1.7%, compared to the decline of 1.4% in the preceding half. Our franchise business is extremely important to us. They remain a critical growth driver for us, and the improvement in franchise issues reflects the improvements we are making in our franchise model. Our omnichannel grew 34%, 44% up in Pick n Pay ASAP! and Mr D. Our clothing business continues to grow. They're up 12% in a very, very tough market. Hazel and her team opened nine more stores in this half, bringing the total estate to 424 stores. We've delivered positive like-for-like growth of 2.2%, and our internal selling price was contained at 2.1%, well below CPI food of 4.6%. we've delivered positive like-for-like growth of 2.2% and our internal selling price was contained at 2.1% well below cpi food of 4.6% I'm also happy to report that this momentum does carry through into the second half. i'm also happy to report that this momentum does carry through into the second half Of specific importance for me is the improvement in our franchise issues, up 1.7%, compared to the decline of 1.4% in the preceding half. of specific importance for me is the improvement in our franchise issues up 1.7% compared to the decline of 1.4% in the preceding half Our franchise business is extremely important to us. our franchise business is extremely important to us They remain a critical growth driver for us, and the improvement in franchise issues reflects the improvements we are making in our franchise model. they remain a critical growth driver for us and the improvement in franchise issues reflects the improvements we are making in our franchise model Our omnichannel grew 34%, 44% up in Pick n Pay ASAP! and Mr D. our omnichannel grew 34% 44% up in pick n pay asap and mr d Our clothing business continues to grow. our clothing business continues to grow They're up 12% in a very, very tough market. they're up 12% in a very very tough market Hazel and her team opened nine more stores in this half, bringing the total estate to 424 stores. hazel and her team opened nine more stores in this half bringing the total estate to 424 stores The Pick n Pay segment itself delivered ZAR 36.3 billion worth of turnover. That is the same number as last year. This is notwithstanding the closing of 59 stores as part of our store estate reset program. Sean will give more detail on this, but this is now largely completed with only a few more stores coming through in the second half. The actual turnover achieved reflects our relentless focus on operational and customer-facing initiatives. The Pick n Pay business is not smaller year-on-year, and as the store closures are now largely in the base, we will continue to grow into the future. As I've mentioned in my opening remarks, we have again segmented Pick n Pay and Boxer and will be presenting the results separately in this presentation. I will now take you through the results of each of them individually. The Pick n Pay segment itself delivered ZAR 36.3 billion worth of turnover. the pick n pay segment itself delivered zar 36.3 billion worth of turnover That is the same number as last year. that is the same number as last year This is notwithstanding the closing of 59 stores as part of our store estate reset program. this is notwithstanding the closing of 59 stores as part of our store estate reset program Sean will give more detail on this, but this is now largely completed with only a few more stores coming through in the second half. sean will give more detail on this but this is now largely completed with only a few more stores coming through in the second half The actual turnover achieved reflects our relentless focus on operational and customer-facing initiatives. the actual turnover achieved reflects our relentless focus on operational and customer-facing initiatives The Pick n Pay business is not smaller year-on-year, and as the store closures are now largely in the base, we will continue to grow into the future. the pick n pay business is not smaller year-on-year and as the store closures are now largely in the base we will continue to grow into the future As I've mentioned in my opening remarks, we have again segmented Pick n Pay and Boxer and will be presenting the results separately in this presentation. as i've mentioned in my opening remarks we have again segmented pick n pay and boxer and will be presenting the results separately in this presentation I will now take you through the results of each of them individually. i will now take you through the results of each of them individually The group now owns 65.6% of Boxer, post the IPO in November 2024. Our Boxer business grew turnover by 13.9% and delivered a trading profit improvement as consolidated by the group of 16.2%. They maintained a trading margin at 4.1%, aligned with the business philosophy to reinvest any gains in their customer offer. Marek and David presented these results on the 13th of October, and I would really like to congratulate them on a job well done. They are now looking like seasoned result professionals. The full Boxer result is available on their website. There we go. The Pick n Pay key metrics reflect progress across all our strategic initiatives. All of these are needed to achieve our goal of getting the business back to profit and cash flow break-even. There were two main drivers of the improvement in the Pick n Pay result. The group now owns 65.6% of Boxer, post the IPO in November 2024. the group now owns 65.6% of boxer post the ipo in november 2024 Our Boxer business grew turnover by 13.9% and delivered a trading profit improvement as consolidated by the group of 16.2%. our boxer business grew turnover by 13.9% and delivered a trading profit improvement as consolidated by the group of 16.2% They maintained a trading margin at 4.1%, aligned with the business philosophy to reinvest any gains in their customer offer. they maintained a trading margin at 4.1% aligned with the business philosophy to reinvest any gains in their customer offer Marek and David presented these results on the 13th of October, and I would really like to congratulate them on a job well done. marek and david presented these results on the 13th of october and i would really like to congratulate them on a job well done They are now looking like seasoned result professionals. they are now looking like seasoned result professionals The full Boxer result is available on their website. the full boxer result is available on their website There we go. there we go The Pick n Pay key metrics reflect progress across all our strategic initiatives. the pick n pay key metrics reflect progress across all our strategic initiatives All of these are needed to achieve our goal of getting the business back to profit and cash flow break-even. all of these are needed to achieve our goal of getting the business back to profit and cash flow break-even There were two main drivers of the improvement in the Pick n Pay result. there were two main drivers of the improvement in the pick n pay result There is an interest benefit year-on-year. As a result of the recapitalization program, the number in the Pick n Pay segment is ZAR 598 million, and we had an improvement in our trading loss of ZAR 97 million. I will unpack these two individually in the following slides. The ZAR 97 million improvement in a trading loss delivered a trading loss of ZAR 621 million. Our trading margin improved by 30 basis points. This was supported by a 40% improvement in our gross profit margin, and I will unpack that in the next slide. A slight increase in our trading expenses, up 20 basis points as a percentage of turnover, and a pleasing increase in our other income, up 2.7%, supported by our increase in commissions and other income of 6.3%. This is very pleasing for us given the fact that the group's turnover was flat year-on-year. There is an interest benefit year-on-year. there is an interest benefit year-on-year As a result of the recapitalization program, the number in the Pick n Pay segment is ZAR 598 million, and we had an improvement in our trading loss of ZAR 97 million. as a result of the recapitalization program the number in the pick n pay segment is zar 598 million and we had an improvement in our trading loss of zar 97 million I will unpack these two individually in the following slides. i will unpack these two individually in the following slides The ZAR 97 million improvement in a trading loss delivered a trading loss of ZAR 621 million. the zar 97 million improvement in a trading loss delivered a trading loss of zar 621 million Our trading margin improved by 30 basis points. our trading margin improved by 30 basis points This was supported by a 40% improvement in our gross profit margin, and I will unpack that in the next slide. this was supported by a 40% improvement in our gross profit margin and i will unpack that in the next slide A slight increase in our trading expenses, up 20 basis points as a percentage of turnover, and a pleasing increase in our other income, up 2.7%, supported by our increase in commissions and other income of 6.3%. a slight increase in our trading expenses up 20 basis points as a percentage of turnover and a pleasing increase in our other income up 2.7% supported by our increase in commissions and other income of 6.3% This is very pleasing for us given the fact that the group's turnover was flat year-on-year. this is very pleasing for us given the fact that the group's turnover was flat year-on-year We have successfully executed our store reset program. There's only a number of stores that will still come in the future. We have avoided losses of close to ZAR 100 million in this result. These were reinvested to support building the muscle we need to create retail excellence for our Pick n Pay turnaround plan. It is very important to note that to achieve this remarkable like-for-like improvement, we needed to make sure that we've got the right skills on a store and operational level. That is what we need to ultimately deliver on our turnaround plan. In this half, we've delivered on the like-for-like sales growth. We've delivered on our gross profit margin improvement. We have reinvested the savings we've made out of the successful store reset plan in key retail skills in our business. As a result, our like-for-like expenses grew 6.2% compared to our turnover of 4.4%. We have successfully executed our store reset program. we have successfully executed our store reset program There's only a number of stores that will still come in the future. there's only a number of stores that will still come in the future We have avoided losses of close to ZAR 100 million in this result. we have avoided losses of close to zar 100 million in this result These were reinvested to support building the muscle we need to create retail excellence for our Pick n Pay turnaround plan. these were reinvested to support building the muscle we need to create retail excellence for our pick n pay turnaround plan It is very important to note that to achieve this remarkable like-for-like improvement, we needed to make sure that we've got the right skills on a store and operational level. it is very important to note that to achieve this remarkable like-for-like improvement we needed to make sure that we've got the right skills on a store and operational level That is what we need to ultimately deliver on our turnaround plan. that is what we need to ultimately deliver on our turnaround plan In this half, we've delivered on the like-for-like sales growth. in this half we've delivered on the like-for-like sales growth We've delivered on our gross profit margin improvement. we've delivered on our gross profit margin improvement We have reinvested the savings we've made out of the successful store reset plan in key retail skills in our business. we have reinvested the savings we've made out of the successful store reset plan in key retail skills in our business As a result, our like-for-like expenses grew 6.2% compared to our turnover of 4.4%. as a result our like-for-like expenses grew 6.2% compared to our turnover of 4.4% That is the reason why the progress on the strategic plan is not yet making a material improvement on the trading loss in the business. We have made great progress, but we have more to do, and it will take time. We are focused on building a sustainable business. We will not chase quick wins just to make the results stronger in the short-term. We are building a long-term profitable business. As a result of this, the improvement in the trading expenses will come, but it will take time as we execute our future-fit strategic initiatives. The gross profit margin increased by 40 basis points, as I've mentioned, up to 16.9%. This was supported by key improvements in category mix, specifically in General Merchandise, Clothing, and our Fresh Range. We had a notable reduction in our waste, specifically in fresh, as in-store operations improved. That is the reason why the progress on the strategic plan is not yet making a material improvement on the trading loss in the business. that is the reason why the progress on the strategic plan is not yet making a material improvement on the trading loss in the business We have made great progress, but we have more to do, and it will take time. we have made great progress but we have more to do and it will take time We are focused on building a sustainable business. we are focused on building a sustainable business We will not chase quick wins just to make the results stronger in the short- term. we will not chase quick wins just to make the results stronger in the short- term We are building a long-term profitable business. we are building a long-term profitable business As a result of this, the improvement in the trading expenses will come, but it will take time as we execute our future-fit strategic initiatives. as a result of this the improvement in the trading expenses will come but it will take time as we execute our future-fit strategic initiatives The gross profit margin increased by 40 basis points, as I've mentioned, up to 16.9%. the gross profit margin increased by 40 basis points as i've mentioned up to 16.9% This was supported by key improvements in category mix, specifically in General Merchandise, Clothing, and our Fresh Range. this was supported by key improvements in category mix specifically in general merchandise clothing and our fresh range We had a notable reduction in our waste, specifically in fresh, as in-store operations improved. we had a notable reduction in our waste specifically in fresh as in-store operations improved We've also improved our buying and our logistic efficiencies. Notwithstanding these improvements, we also made investments. Pick n Pay is price competitive. We have achieved this while improving our customer offer. We now offer an increased range at better prices without compromising on our inventory control. We have also invested in our franchise model. We have reduced the sales margin to our franchisees to ensure that these very important partners improve their underlying profitability. The improvement of the 40 basis points on this line item is therefore a very strong achievement, considering the investments that we made during the period. Our trading expenses are up only 0.9%. This reflects the impact of the store reset plan. On a like-for-like basis, the increase is up 6.2%. The increase in like-for-like expenses was driven by the building blocks of the future-fit business. We continued selective hiring in key skills to drive turnover. We've also improved our buying and our logistic efficiencies. we've also improved our buying and our logistic efficiencies Notwithstanding these improvements, we also made investments. notwithstanding these improvements we also made investments Pick n Pay is price competitive. pick n pay is price competitive We have achieved this while improving our customer offer. we have achieved this while improving our customer offer We now offer an increased range at better prices without compromising on our inventory control. we now offer an increased range at better prices without compromising on our inventory control We have also invested in our franchise model. we have also invested in our franchise model We have reduced the sales margin to our franchisees to ensure that these very important partners improve their underlying profitability. we have reduced the sales margin to our franchisees to ensure that these very important partners improve their underlying profitability The improvement of the 40 basis points on this line item is therefore a very strong achievement, considering the investments that we made during the period. the improvement of the 40 basis points on this line item is therefore a very strong achievement considering the investments that we made during the period Our trading expenses are up only 0.9%. our trading expenses are up only 0.9% This reflects the impact of the store reset plan. this reflects the impact of the store reset plan On a like-for-like basis, the increase is up 6.2%. on a like-for-like basis the increase is up 6.2% The increase in like-for-like expenses was driven by the building blocks of the future-fit business. the increase in like-for-like expenses was driven by the building blocks of the future-fit business We continued selective hiring in key skills to drive turnover. we continued selective hiring in key skills to drive turnover We have increased store training in a focused and effective manner. We've increased brand investment. I'm sure most of you would have noticed. While we are focusing on spending in the right areas, the remaining expenses remain well controlled. As I've mentioned before, we are acutely aware of the need to ensure that our like-for-like expenses increase by a rate less than our like-for-like turnover growth, and this remains a key focus area for us. Pick n Pay's net finance cost reduced by 60% for the period. This is a result of the FY 2025 debt paydown. This, alongside a reduction in our net lease interest of 2.2%, reflecting the successful store reset plan, has really supported the year-on-year profitability of this result. The group's headline earnings per share showed significant improvement, up 56.2%. We have increased store training in a focused and effective manner. we have increased store training in a focused and effective manner We've increased brand investment. we've increased brand investment I'm sure most of you would have noticed. i'm sure most of you would have noticed While we are focusing on spending in the right areas, the remaining expenses remain well controlled. while we are focusing on spending in the right areas the remaining expenses remain well controlled As I've mentioned before, we are acutely aware of the need to ensure that our like-for-like expenses increase by a rate less than our like-for-like turnover growth, and this remains a key focus area for us. as i've mentioned before we are acutely aware of the need to ensure that our like-for-like expenses increase by a rate less than our like-for-like turnover growth and this remains a key focus area for us Pick n Pay's net finance cost reduced by 60% for the period. pick n pay's net finance cost reduced by 60% for the period This is a result of the FY 2025 debt paydown. this is a result of the fy 2025 debt paydown This, alongside a reduction in our net lease interest of 2.2%, reflecting the successful store reset plan, has really supported the year-on-year profitability of this result. this alongside a reduction in our net lease interest of 2.2% reflecting the successful store reset plan has really supported the year-on-year profitability of this result The group's headline earnings per share showed significant improvement, up 56.2%. the group's headline earnings per share showed significant improvement up 56.2% This, as I've mentioned before, was supported by the interest swing on a group level of ZAR 537 million. Two additional items impacted year-on-year comparability. We've got a 25% increase in our weighted average number of shares as a result of the rights offer in August 2024. We also now have a controlling interest of Boxer of 34.4%, post the IPO in November 2024. Excluding these items, alongside the interest saving, our headline earnings per share increased 27.8%, reflecting the trading result improvement in both Boxer and Pick n Pay. Pick n Pay ended the half with ZAR 3.9 billion of cash on balance sheet. The cash utilized from operations of ZAR 0.8 billion is in line with what we've done last year. The improvements delivered through the store reset plan were reinvested, and therefore it's reflective in the year-on-year EBITDA number being flat. This, as I've mentioned before, was supported by the interest swing on a group level of ZAR 537 million. this as i've mentioned before was supported by the interest swing on a group level of zar 537 million Two additional items impacted year-on-year comparability. two additional items impacted year-on-year comparability We've got a 25% increase in our weighted average number of shares as a result of the rights offer in August 2024. we've got a 25% increase in our weighted average number of shares as a result of the rights offer in august 2024 We also now have a controlling interest of Boxer of 34.4%, post the IPO in November 2024. we also now have a controlling interest of boxer of 34.4% post the ipo in november 2024 Excluding these items, alongside the interest saving, our headline earnings per share increased 27.8%, reflecting the trading result improvement in both Boxer and Pick n Pay. excluding these items alongside the interest saving our headline earnings per share increased 27.8% reflecting the trading result improvement in both boxer and pick n pay Pick n Pay ended the half with ZAR 3.9 billion of cash on balance sheet. pick n pay ended the half with zar 3.9 billion of cash on balance sheet The cash utilized from operations of ZAR 0.8 billion is in line with what we've done last year. the cash utilized from operations of zar 0.8 billion is in line with what we've done last year The improvements delivered through the store reset plan were reinvested, and therefore it's reflective in the year-on-year EBITDA number being flat. the improvements delivered through the store reset plan were reinvested and therefore it's reflective in the year-on-year ebitda number being flat To build retail excellence, we need to deliver this plan. We absolutely have to invest in these skills to drive top line across FY 2027 and FY 2028. Interest received for the year was just over ZAR 100 million, reflecting the improvement of ZAR 0.5 billion year-on-year. The working capital and CapEx movements I will unpack in the next slides. The net result was a free cash flow utilization of ZAR 0.3 billion for the year, in line with our plans. I guided at the full year FY 2025 result that we are aiming to halve the cash burn for the Pick n Pay segment of last year of ZAR 2.6 billion. We are now forecasting that the cash burn for this year will be approximately ZAR 1.6 billion. The group released working capital of ZAR 1.7 billion for the half. This is across both Boxer and Pick n Pay. To build retail excellence, we need to deliver this plan. to build retail excellence we need to deliver this plan We absolutely have to invest in these skills to drive top line across FY 2027 and FY 2028. we absolutely have to invest in these skills to drive top line across fy 2027 and fy 2028 Interest received for the year was just over ZAR 100 million, reflecting the improvement of ZAR 0.5 billion year-on-year. interest received for the year was just over zar 100 million reflecting the improvement of zar 0.5 billion year-on-year The working capital and CapEx movements I will unpack in the next slides. the working capital and capex movements i will unpack in the next slides The net result was a free cash flow utilization of ZAR 0.3 billion for the year, in line with our plans. the net result was a free cash flow utilization of zar 0.3 billion for the year in line with our plans I guided at the full year FY 2025 result that we are aiming to halve the cash burn for the Pick n Pay segment of last year of ZAR 2.6 billion. i guided at the full year fy 2025 result that we are aiming to halve the cash burn for the pick n pay segment of last year of zar 2.6 billion We are now forecasting that the cash burn for this year will be approximately ZAR 1.6 billion. we are now forecasting that the cash burn for this year will be approximately zar 1.6 billion The group released working capital of ZAR 1.7 billion for the half. the group released working capital of zar 1.7 billion for the half This is across both Boxer and Pick n Pay. this is across both boxer and pick n pay This is in line with our normal H1, H2 seasonality, and this benefit will be absorbed during the second half of the year. There is some cutoff as well, but both the cutoff and the seasonality will unwind in the second half of the year. What is important to note is Pick n Pay's continued working capital improvement. Our inventory declined by 3.5%, notwithstanding the fact that our turnover year-on-year was flat and we reinvested in our ranges. There has been a continuous focus on optimizing inventory in the business. We've also seen a continued improvement in our franchise debt as the impact of the new franchise model is supporting our franchisees. I am very comfortable with the working capital levels of both Pick n Pay and Boxer. The group invested ZAR 0.9 billion during the first half of this year. This is in line with our normal H1, H2 seasonality, and this benefit will be absorbed during the second half of the year. this is in line with our normal h1 h2 seasonality and this benefit will be absorbed during the second half of the year There is some cutoff as well, but both the cutoff and the seasonality will unwind in the second half of the year. there is some cutoff as well but both the cutoff and the seasonality will unwind in the second half of the year What is important to note is Pick n Pay's continued working capital improvement. what is important to note is pick n pay's continued working capital improvement Our inventory declined by 3.5%, notwithstanding the fact that our turnover year-on-year was flat and we reinvested in our ranges. our inventory declined by 3.5% notwithstanding the fact that our turnover year-on-year was flat and we reinvested in our ranges There has been a continuous focus on optimizing inventory in the business. there has been a continuous focus on optimizing inventory in the business We've also seen a continued improvement in our franchise debt as the impact of the new franchise model is supporting our franchisees. we've also seen a continued improvement in our franchise debt as the impact of the new franchise model is supporting our franchisees I am very comfortable with the working capital levels of both Pick n Pay and Boxer. i am very comfortable with the working capital levels of both pick n pay and boxer The group invested ZAR 0.9 billion during the first half of this year. the group invested zar 0.9 billion during the first half of this year Both Boxer and Clothing continue to invest to support their growth ambitions. Pick n Pay's forecasted spend for the full year is ZAR 0.9 billion. This is an increase from the ZAR 500 million of last year. The Pick n Pay spend remains measured. We are spending on key revamps where we know we can get the maximum ROI and critical repairs and maintenance. Our focus remains in investment in OpEx, in the skills we need to drive our like-for-like turnover growth. The group ended with cash reserves of ZAR 5.1 billion, ZAR 3.9 billion in Pick n Pay, and ZAR 1.1 billion in Boxer. Pick n Pay itself has got ZAR 3 billion worth of working capital facilities. These are unutilized, unsecured, and not guaranteed by Boxer. Our balance sheet is strong. It will support Boxer's growth and Pick n Pay on its turnaround path. Both Boxer and Clothing continue to invest to support their growth ambitions. both boxer and clothing continue to invest to support their growth ambitions Pick n Pay's forecasted spend for the full year is ZAR 0.9 billion. pick n pay's forecasted spend for the full year is zar 0.9 billion This is an increase from the ZAR 500 million of last year. this is an increase from the zar 500 million of last year The Pick n Pay spend remains measured. the pick n pay spend remains measured We are spending on key revamps where we know we can get the maximum ROI and critical repairs and maintenance. we are spending on key revamps where we know we can get the maximum roi and critical repairs and maintenance Our focus remains in investment in OpEx, in the skills we need to drive our like-for-like turnover growth. our focus remains in investment in opex in the skills we need to drive our like-for-like turnover growth The group ended with cash reserves of ZAR 5.1 billion, ZAR 3.9 billion in Pick n Pay, and ZAR 1.1 billion in Boxer. the group ended with cash reserves of zar 5.1 billion zar 3.9 billion in pick n pay and zar 1.1 billion in boxer Pick n Pay itself has got ZAR 3 billion worth of working capital facilities. pick n pay itself has got zar 3 billion worth of working capital facilities These are unutilized, unsecured, and not guaranteed by Boxer. these are unutilized unsecured and not guaranteed by boxer Our balance sheet is strong. our balance sheet is strong It will support Boxer's growth and Pick n Pay on its turnaround path. it will support boxer's growth and pick n pay on its turnaround path I now hand over to Sean to take you through the operational review. I now hand over to Sean to take you through the operational review. i now hand over to sean to take you through the operational review

Speaker 6: Thanks, Lerena. As we see, it's definitely work in progress, and as I've said, it's a case of just steadily putting one foot in front of the other as we continue in our journey. There are just a couple of specific call-outs that I would like to make in this regard. We said that in terms of strengthening our core customer offer, we would apply a lot of our energy and effort in terms of ranging in the store, and we can see that the ranges are dramatically improved and enhanced at store level. Thanks, Lerena. thanks lerena As we see, it's definitely work in progress, and as I've said, it's a case of just steadily putting one foot in front of the other as we continue in our journey. as we see it's definitely work in progress and as i've said it's a case of just steadily putting one foot in front of the other as we continue in our journey There are just a couple of specific call-outs that I would like to make in this regard. there are just a couple of specific call-outs that i would like to make in this regard We said that in terms of strengthening our core customer offer, we would apply a lot of our energy and effort in terms of ranging in the store, and we can see that the ranges are dramatically improved and enhanced at store level. we said that in terms of strengthening our core customer offer we would apply a lot of our energy and effort in terms of ranging in the store and we can see that the ranges are dramatically improved and enhanced at store level It's one of the reasons why we are driving our like-for-like sales growth, because when you look at our absolute numbers in the total stores that we've closed over the period of time in the last two years, 18 months that we've been going at this project, we have, while we've been taking some sales out of the business in the closed stores, managed to re-inject like-for-like sales growth back into the stores again with enhanced ranging. On a quality basis, we've applied a lot of our energy and attention as to what happens at store level operationally with skills and injecting knowledge back into the business again. We can see that on the value front, from a marketing perspective, we have really, really put our strong foot forward in terms of marketing. It's one of the reasons why we are driving our like-for-like sales growth, because when you look at our absolute numbers in the total stores that we've closed over the period of time in the last two years, 18 months that we've been going at this project, we have, while we've been taking some sales out of the business in the closed stores, managed to re-inject like-for-like sales growth back into the stores again with enhanced ranging. it's one of the reasons why we are driving our like-for-like sales growth because when you look at our absolute numbers in the total stores that we've closed over the period of time in the last two years 18 months that we've been going at this project we have while we've been taking some sales out of the business in the closed stores managed to re-inject like-for-like sales growth back into the stores again with enhanced ranging On a quality basis, we've applied a lot of our energy and attention as to what happens at store level operationally with skills and injecting knowledge back into the business again. on a quality basis we've applied a lot of our energy and attention as to what happens at store level operationally with skills and injecting knowledge back into the business again We can see that on the value front, from a marketing perspective, we have really, really put our strong foot forward in terms of marketing. we can see that on the value front from a marketing perspective we have really really put our strong foot forward in terms of marketing Our relationship with FNB eBucks continues to be a fantastic relationship that we have, and all of the work that we've been doing with the Burger Fridays and the work that we do on Saturdays and Sundays and all of these promotions that we're doing has really been driving a good value proposition across the business. On the service front, we have been applying a lot of our energy and effort into training of our people again and actually getting and creating schools for blockmen, bakers, and re-getting these skills back into the company again, because these skills are not just freely available. It takes time to train these people up. A lot of focus, and you know, if you go back, Pick n Pay was always known as the Fresh Food people, and to a large degree, we had lost that. Our relationship with FNB eBucks continues to be a fantastic relationship that we have, and all of the work that we've been doing with the Burger Fridays and the work that we do on Saturdays and Sundays and all of these promotions that we're doing has really been driving a good value proposition across the business. our relationship with fnb ebucks continues to be a fantastic relationship that we have and all of the work that we've been doing with the burger fridays and the work that we do on saturdays and sundays and all of these promotions that we're doing has really been driving a good value proposition across the business On the service front, we have been applying a lot of our energy and effort into training of our people again and actually getting and creating schools for blockmen, bakers, and re-getting these skills back into the company again, because these skills are not just freely available. on the service front we have been applying a lot of our energy and effort into training of our people again and actually getting and creating schools for blockmen bakers and re-getting these skills back into the company again because these skills are not just freely available It takes time to train these people up. it takes time to train these people up A lot of focus, and you know, if you go back, Pick n Pay was always known as the Fresh Food people, and to a large degree, we had lost that. a lot of focus and you know if you go back pick n pay was always known as the fresh food people and to a large degree we had lost that This is one of the major journeys that we're on at the moment, reinvigorating our whole fresh offering in the company and getting back onto this virtuous circle. We're starting to see the rewards coming out of this now in terms of the work that's been done under Pieter and the Fresh Food team. In terms of online and what we do with ASAP!, we relaunched the ASAP! app this year, and we have consolidated everything into the one app to make it far more user-friendly. We now have to arrange 35,000-odd products in ASAP! ASAP! continues to be a very important part of the offer that we have in the company. For those customers who want their goods delivered home, we will do it gladly with the greatest of pleasure. This is one of the major journeys that we're on at the moment, reinvigorating our whole fresh offering in the company and getting back onto this virtuous circle. this is one of the major journeys that we're on at the moment reinvigorating our whole fresh offering in the company and getting back onto this virtuous circle We're starting to see the rewards coming out of this now in terms of the work that's been done under Pieter and the Fresh Food team. we're starting to see the rewards coming out of this now in terms of the work that's been done under pieter and the fresh food team In terms of online and what we do with ASAP!, we relaunched the ASAP! app this year, and we have consolidated everything into the one app to make it far more user-friendly. We now have to arrange 35,000-odd products in ASAP! ASAP ! continues to be a very important part of the offer that we have in the company. in terms of online and what we do with asap we relaunched the asap app this year and we have consolidated everything into the one app to make it far more user-friendly. we now have to arrange 35,000-odd products in asap! asap continues to be a very important part of the offer that we have in the company For those customers who want their goods delivered home, we will do it gladly with the greatest of pleasure. for those customers who want their goods delivered home we will do it gladly with the greatest of pleasure Our primary focus as a retailer still remains, number one, on having great stores with great product, great people, and great shopping experience as the backbone of what we do. Franchise, I'm pleased to report that our franchise has moved positively into, I think it's from about -1.4%, now up to 1.7% like-for-likes in franchise, and that's moved forward strongly. We had a fantastic franchise conference two weeks ago in Johannesburg, and I'm pleased to say that our relationship with our franchisees today is as strong as it's ever been. The changes that we've made on the franchise model are working very, very well. In general, you just get a good feeling when you go around the company and you visit with the franchisees. It's just extraordinary. We had two of our great franchisees this year that won the awards, came from STUTTERHEIM and [Würpstadt.] Our primary focus as a retailer still remains, number one, on having great stores with great product, great people, and great shopping experience as the backbone of what we do. our primary focus as a retailer still remains number one on having great stores with great product great people and great shopping experience as the backbone of what we do Franchise, I'm pleased to report that our franchise has moved positively into, I think it's from about -1.4%, now up to 1.7% like-for-likes in franchise, and that's moved forward strongly. franchise i'm pleased to report that our franchise has moved positively into i think it's from about -1.4% now up to 1.7% like-for-likes in franchise and that's moved forward strongly We had a fantastic franchise conference two weeks ago in Johannesburg, and I'm pleased to say that our relationship with our franchisees today is as strong as it's ever been. we had a fantastic franchise conference two weeks ago in johannesburg and i'm pleased to say that our relationship with our franchisees today is as strong as it's ever been The changes that we've made on the franchise model are working very, very well. the changes that we've made on the franchise model are working very very well In general, you just get a good feeling when you go around the company and you visit with the franchisees. in general you just get a good feeling when you go around the company and you visit with the franchisees It's just extraordinary. it's just extraordinary We had two of our great franchisees this year that won the awards, came from STUTTERHEIM and [Würpstadt.] we had two of our great franchisees this year that won the awards came from stutterheim and [würpstadt.] If you look at STUTTERHEIM, our franchise family in the area of STUTTERHEIM, they almost run that town in terms of the work that they do with council and community and everybody. It's just extraordinary to see how these families really, really operate in these marketplaces. It's just too beautiful. Our hypermarkets is another key area of focus for us, where we are really putting the real essence of hypermarkets back into hypermarket again. We're seeing great success in this regard. Some of our larger stores, where we sort of got a 6,000 sq m GL, well, not GLA, we've got 6,000 sq m trading on the floor, 5,000 sq m on the floor that we're converting this over to hypermarkets. We're putting enhanced GMD ranges back in there again, and we're getting extraordinary success with this format. I see Gareth sitting over there. Well done. If you look at STUTTERHEIM, our franchise family in the area of STUTTERHEIM, they almost run that town in terms of the work that they do with council and community and everybody. if you look at stutterheim our franchise family in the area of stutterheim they almost run that town in terms of the work that they do with council and community and everybody It's just extraordinary to see how these families really, really operate in these marketplaces. it's just extraordinary to see how these families really really operate in these marketplaces It's just too beautiful. it's just too beautiful Our hypermarkets is another key area of focus for us, where we are really putting the real essence of hypermarkets back into hypermarket again. our hypermarkets is another key area of focus for us where we are really putting the real essence of hypermarkets back into hypermarket again We're seeing great success in this regard. we're seeing great success in this regard Some of our larger stores, where we sort of got a 6,000 sq m GL, well, not GLA, we've got 6,000 sq m trading on the floor, 5,000 sq m on the floor that we're converting this over to hypermarkets. some of our larger stores where we sort of got a 6,000 sq m gl well not gla we've got 6,000 sq m trading on the floor 5,000 sq m on the floor that we're converting this over to hypermarkets We're putting enhanced GMD ranges back in there again, and we're getting extraordinary success with this format. we're putting enhanced gmd ranges back in there again and we're getting extraordinary success with this format I see Gareth sitting over there. i see gareth sitting over there Well done. well done We're really getting good traction there. If we look at where we are and we have a look at our acceleration in like-for-like sales, it really is extraordinary in a very, very constrained market. I think one needs to be realistic in life about the marketplace that we do operate in. It's interesting in this marketplace because at the moment we have a retail space where we're still seeing a lot of doors being opened by our competitors. One of them alone was over 300 new doors in the last year. You take that against us closing 50, 60-odd stores over 18 months. If you just have a look at the dynamic of optionality for consumers to shop elsewhere, it really is extraordinary that we've managed to grow the like-for-like sales to the degree that we have. I'm always realistic about these things. We're really getting good traction there. we're really getting good traction there If we look at where we are and we have a look at our acceleration in like-for-like sales, it really is extraordinary in a very, very constrained market. if we look at where we are and we have a look at our acceleration in like-for-like sales it really is extraordinary in a very very constrained market I think one needs to be realistic in life about the marketplace that we do operate in. i think one needs to be realistic in life about the marketplace that we do operate in It's interesting in this marketplace because at the moment we have a retail space where we're still seeing a lot of doors being opened by our competitors. it's interesting in this marketplace because at the moment we have a retail space where we're still seeing a lot of doors being opened by our competitors One of them alone was over 300 new doors in the last year. one of them alone was over 300 new doors in the last year You take that against us closing 50, 60-odd stores over 18 months. you take that against us closing 50 60-odd stores over 18 months If you just have a look at the dynamic of optionality for consumers to shop elsewhere, it really is extraordinary that we've managed to grow the like-for-like sales to the degree that we have. if you just have a look at the dynamic of optionality for consumers to shop elsewhere it really is extraordinary that we've managed to grow the like-for-like sales to the degree that we have I'm always realistic about these things. i'm always realistic about these things If you ask me, what is one of the real pleasant surprises that really surprised me, it's actually been our ability to show this level of like-for-like sales growth. I'm realistic about these things because you can never, ever fool yourself and end up in a sort of a fool's paradise because people tell you what you want to hear. Sometimes when you sit with suppliers, vendors, landlords, they also tell you what they think you want to hear. You need to keep your feet on the ground. We have various ways that we can read markets. There are certain market surveys and stuff that are done out there. I'm just really so astounded by the fact that our continual market share decline that we were in has in fact bottomed out, started to solidify, and is starting to move in the right direction again. If you ask me, what is one of the real pleasant surprises that really surprised me, it's actually been our ability to show this level of like-for-like sales growth. if you ask me what is one of the real pleasant surprises that really surprised me it's actually been our ability to show this level of like-for-like sales growth I'm realistic about these things because you can never, ever fool yourself and end up in a sort of a fool's paradise because people tell you what you want to hear. i'm realistic about these things because you can never ever fool yourself and end up in a sort of a fool's paradise because people tell you what you want to hear Sometimes when you sit with suppliers, vendors, landlords, they also tell you what they think you want to hear. sometimes when you sit with suppliers vendors landlords they also tell you what they think you want to hear You need to keep your feet on the ground. you need to keep your feet on the ground We have various ways that we can read markets. There are certain market surveys and stuff that are done out there. we have various ways that we can read markets. there are certain market surveys and stuff that are done out there I'm just really so astounded by the fact that our continual market share decline that we were in has in fact bottomed out, started to solidify, and is starting to move in the right direction again. i'm just really so astounded by the fact that our continual market share decline that we were in has in fact bottomed out started to solidify and is starting to move in the right direction again That's in the market, and that's total market. That's moving into a market where we're just seeing so much other optionality that's available out there. It's extraordinary in this regard. Hopefully, this trend will continue to move forward in this direction. We obviously have some challenges in this marketplace as well. We're now coming to annualize on the two-pot release that happened last year. It's going to be interesting to see what effect that's going to have in the next weeks and months as that starts to annualize and move through. Obviously, a very tough market that we're in. In terms of establishing a future-fit business, as I said at the opening, if we went back with the benefit of hindsight and looked at what we've done in the company, what would we do differently? There would not be much that we would actually be doing differently. That's in the market, and that's total market. that's in the market and that's total market That's moving into a market where we're just seeing so much other optionality that's available out there. that's moving into a market where we're just seeing so much other optionality that's available out there It's extraordinary in this regard. it's extraordinary in this regard Hopefully, this trend will continue to move forward in this direction. hopefully this trend will continue to move forward in this direction We obviously have some challenges in this marketplace as well. we obviously have some challenges in this marketplace as well We're now coming to annualize on the two-pot release that happened last year. we're now coming to annualize on the two-pot release that happened last year It's going to be interesting to see what effect that's going to have in the next weeks and months as that starts to annualize and move through. it's going to be interesting to see what effect that's going to have in the next weeks and months as that starts to annualize and move through Obviously, a very tough market that we're in. obviously a very tough market that we're in In terms of establishing a future-fit business, as I said at the opening, if we went back with the benefit of hindsight and looked at what we've done in the company, what would we do differently? in terms of establishing a future-fit business as i said at the opening if we went back with the benefit of hindsight and looked at what we've done in the company what would we do differently There would not be much that we would actually be doing differently. there would not be much that we would actually be doing differently In all of these metrics that are over here, there are two that I'd like to specifically call out. The first one is the store estate reset, which is nearing completion. Now, it's always fascinated me how Pick n Pay closing stores has predominated in all of the media, and everything you read is Pick n Pay is closing, Pick n Pay is closing. No, we got rid of stores that were no good. That's just the simple truth of it. It is something that every single retailer does. We hadn't done enough for a long, long period of time. The journey is done. There will be a few more left that we're going to mop up at the end. In all of these metrics that are over here, there are two that I'd like to specifically call out. in all of these metrics that are over here there are two that i'd like to specifically call out The first one is the store estate reset, which is nearing completion. the first one is the store estate reset which is nearing completion Now, it's always fascinated me how Pick n Pay closing stores has predominated in all of the media, and everything you read is Pick n Pay is closing, Pick n Pay is closing. now it's always fascinated me how pick n pay closing stores has predominated in all of the media and everything you read is pick n pay is closing pick n pay is closing No, we got rid of stores that were no good. no we got rid of stores that were no good That's just the simple truth of it. that's just the simple truth of it It is something that every single retailer does. it is something that every single retailer does We hadn't done enough for a long, long period of time. we hadn't done enough for a long long period of time The journey is done. the journey is done There will be a few more left that we're going to mop up at the end. there will be a few more left that we're going to mop up at the end The great thing here is if you have a look at 27 of the stores that were originally identified, they have actually either turned to profit or are coming back, getting close to turning to profit again. Even at a break-even level, at a store level, it still contributes to the center. This thing is neither. It's a very dynamic process, and it's not necessarily linear or binary. This journey is done. From here on in, as we review leases as they come up, we will continue to assess each lease on a store-by-store basis. In some places, demographics change, the center of what's happening, a taxi rank moves, stores are now rendered no longer in the right place, and that'll just be part and parcel of what we do. I'm pleased to say that this is basically done, which is fantastic. The great thing here is if you have a look at 27 of the stores that were originally identified, they have actually either turned to profit or are coming back, getting close to turning to profit again. the great thing here is if you have a look at 27 of the stores that were originally identified they have actually either turned to profit or are coming back getting close to turning to profit again Even at a break-even level, at a store level, it still contributes to the center. even at a break-even level at a store level it still contributes to the center This thing is neither. this thing is neither It's a very dynamic process, and it's not necessarily linear or binary. it's a very dynamic process and it's not necessarily linear or binary This journey is done. this journey is done From here on in, as we review leases as they come up, we will continue to assess each lease on a store-by-store basis. from here on in as we review leases as they come up we will continue to assess each lease on a store-by-store basis In some places, demographics change, the center of what's happening, a taxi rank moves, stores are now rendered no longer in the right place, and that'll just be part and parcel of what we do. in some places demographics change the center of what's happening a taxi rank moves stores are now rendered no longer in the right place and that'll just be part and parcel of what we do I'm pleased to say that this is basically done, which is fantastic. i'm pleased to say that this is basically done which is fantastic The other really great one is our strategic supplier partnership that we have here. As we know, our eSport distribution center, which is the most extraordinary facility. As I said to Marcel, I think Marcel, I saw you walking in earlier. There's Marcel sitting there. As I said to Marcel in the beginning, don't be defensive of this, Marcel, because in the brief that you were given, you achieved 11 out of 10. You built a magnificent facility there. Unfortunately, for the wrong company, it was too big, way too big. I'm pleased to say that we've signed our MOU with DP World, and the eSport facility has now moved off to DP World, and we will be getting those savings and start to get those savings almost with immediate effect. The other really great one is our strategic supplier partnership that we have here. the other really great one is our strategic supplier partnership that we have here As we know, our eSport distribution center, which is the most extraordinary facility. as we know our esport distribution center which is the most extraordinary facility As I said to Marcel, I think Marcel, I saw you walking in earlier. as i said to marcel i think marcel i saw you walking in earlier There's Marcel sitting there. there's marcel sitting there As I said to Marcel in the beginning, don't be defensive of this, Marcel, because in the brief that you were given, you achieved 11 out of 10. as i said to marcel in the beginning don't be defensive of this marcel because in the brief that you were given you achieved 11 out of 10 You built a magnificent facility there. you built a magnificent facility there Unfortunately, for the wrong company, it was too big, way too big. unfortunately for the wrong company it was too big way too big I'm pleased to say that we've signed our MOU with DP World, and the eSport facility has now moved off to DP World, and we will be getting those savings and start to get those savings almost with immediate effect. i'm pleased to say that we've signed our mou with dp world and the esport facility has now moved off to dp world and we will be getting those savings and start to get those savings almost with immediate effect It's an extraordinary job of work that has been done, and I'm pleased to say that eSport is now currently almost fully utilized because they have the ability to put some of their existing clients that they have into the building, and some of those people are in fact Pick n Pay suppliers. It's even more efficient because the stock is now actually in the building. It's a win-win across all the pieces of work that we're doing there. That's another fantastic, huge piece of work that we've got done and ticked off. Our digital transformation, and the reason why I call this out is just simply that there's a lot of talk around what is going on in this marketplace in terms of digital transformation and retail media and all of this. We've been in this for ages. It's an extraordinary job of work that has been done, and I'm pleased to say that eSport is now currently almost fully utilized because they have the ability to put some of their existing clients that they have into the building, and some of those people are in fact Pick n Pay suppliers. it's an extraordinary job of work that has been done and i'm pleased to say that esport is now currently almost fully utilized because they have the ability to put some of their existing clients that they have into the building and some of those people are in fact pick n pay suppliers It's even more efficient because the stock is now actually in the building. it's even more efficient because the stock is now actually in the building It's a win-win across all the pieces of work that we're doing there. it's a win-win across all the pieces of work that we're doing there That's another fantastic, huge piece of work that we've got done and ticked off. that's another fantastic huge piece of work that we've got done and ticked off Our digital transformation, and the reason why I call this out is just simply that there's a lot of talk around what is going on in this marketplace in terms of digital transformation and retail media and all of this. our digital transformation and the reason why i call this out is just simply that there's a lot of talk around what is going on in this marketplace in terms of digital transformation and retail media and all of this We've been in this for ages. we've been in this for ages In fact, we started selling our data at the end of my days in my previous life at Pick n Pay already. This is nothing new. It continues to evolve. It's a very, very important part of the business, and we will continue to grow this. In all of these areas, retail media and data analytics for our suppliers, this we will continue to grow. As we do, Smart Shopper, very, very important to us. It's a key part of our business, as I said before. Obviously, our value-added services. We've received quite a lot of rewards and awards and accolades for the advertising and marketing that we've done. I think you will see in the company that our marketing is a lot crisper, it's a lot clearer, and it's a lot more targeted and directed than it used to be. In fact, we started selling our data at the end of my days in my previous life at Pick n Pay already. in fact we started selling our data at the end of my days in my previous life at pick n pay already This is nothing new. this is nothing new It continues to evolve. it continues to evolve It's a very, very important part of the business, and we will continue to grow this. it's a very very important part of the business and we will continue to grow this In all of these areas, retail media and data analytics for our suppliers, this we will continue to grow. in all of these areas retail media and data analytics for our suppliers this we will continue to grow As we do, Smart Shopper, very, very important to us. as we do smart shopper very very important to us It's a key part of our business, as I said before. it's a key part of our business as i said before Obviously, our value-added services. obviously our value-added services We've received quite a lot of rewards and awards and accolades for the advertising and marketing that we've done. we've received quite a lot of rewards and awards and accolades for the advertising and marketing that we've done I think you will see in the company that our marketing is a lot crisper, it's a lot clearer, and it's a lot more targeted and directed than it used to be. i think you will see in the company that our marketing is a lot crisper it's a lot clearer and it's a lot more targeted and directed than it used to be Clothing, our clothing continues to perform fantastically and just extraordinary, where Pick n Pay has really found a segment in the marketplace that Hazel and her team have clearly really been able to identify what it is that their customers are looking for in terms of value and in terms of fashion, and it continues to grow strongly. Boxer, Marek and his team have, they've just done the most extraordinary, extraordinary job of work. As you say, Lerena, they're now experienced results and roadshow presenters. Marek phoned me this morning to wish me well because he had a week like I'm going to have two weeks ago. Boxer truly is an absolute, absolute gem. They're just in the right spot and their virtuous circle is incredible. To Marek, to you and your entire team, all I can say is well, well done, my friend. Clothing, our clothing continues to perform fantastically and just extraordinary, where Pick n Pay has really found a segment in the marketplace that Hazel and her team have clearly really been able to identify what it is that their customers are looking for in terms of value and in terms of fashion, and it continues to grow strongly. clothing our clothing continues to perform fantastically and just extraordinary where pick n pay has really found a segment in the marketplace that hazel and her team have clearly really been able to identify what it is that their customers are looking for in terms of value and in terms of fashion and it continues to grow strongly Boxer, Marek and his team have, they've just done the most extraordinary, extraordinary job of work. boxer marek and his team have they've just done the most extraordinary extraordinary job of work As you say, Lerena, they're now experienced results and roadshow presenters. as you say lerena they're now experienced results and roadshow presenters Marek phoned me this morning to wish me well because he had a week like I'm going to have two weeks ago. marek phoned me this morning to wish me well because he had a week like i'm going to have two weeks ago Boxer truly is an absolute, absolute gem. boxer truly is an absolute absolute gem They're just in the right spot and their virtuous circle is incredible. they're just in the right spot and their virtuous circle is incredible To Marek, to you and your entire team, all I can say is well, well done, my friend. to marek to you and your entire team all i can say is well well done my friend We're very, very proud of you and very privileged to have you as a part of us. Supporting our communities, notwithstanding the fact that we are busy working our way back into the sunshine and busy working our way back into profit, we have doubled down on our efforts in terms of what has always made Pick n Pay what it is. When Raymond and Wendy started Pick n Pay, there was always the fundamental belief that this is a company for the people, by the people, and that you invest in society, you invest in community, and it is something that we have doubled down. We're very, very proud of you and very privileged to have you as a part of us. we're very very proud of you and very privileged to have you as a part of us Supporting our communities, notwithstanding the fact that we are busy working our way back into the sunshine and busy working our way back into profit, we have doubled down on our efforts in terms of what has always made Pick n Pay what it is. supporting our communities notwithstanding the fact that we are busy working our way back into the sunshine and busy working our way back into profit we have doubled down on our efforts in terms of what has always made pick n pay what it is When Raymond and Wendy started Pick n Pay, there was always the fundamental belief that this is a company for the people, by the people, and that you invest in society, you invest in community, and it is something that we have doubled down. when raymond and wendy started pick n pay there was always the fundamental belief that this is a company for the people by the people and that you invest in society you invest in community and it is something that we have doubled down You know, we have a CSI WhatsApp group, and I'm just astounded every week, every weekend during the week at the updates that just continually get flicked through, where right across the length and breadth of this country, our people just do the most extraordinary acts of help, of reaching out to community and supporting people in need. It's really magnificent. This has been one of the really wonderful things for us and a great privilege for us to have been a sponsor of the Springbok. You know, at the start, it was always a case of the Springbok being the one thing in this country that unites South Africa and pulls South Africa together, because if ever this country needed to start pulling together, it's now. That's why for us, in the first instance of the Springbok, it was more than just about sponsoring the Springbok. You know, we have a CSI WhatsApp group, and I'm just astounded every week, every weekend during the week at the updates that just continually get flicked through, where right across the length and breadth of this country, our people just do the most extraordinary acts of help, of reaching out to community and supporting people in need. you know we have a csi whatsapp group and i'm just astounded every week every weekend during the week at the updates that just continually get flicked through where right across the length and breadth of this country our people just do the most extraordinary acts of help of reaching out to community and supporting people in need It's really magnificent. it's really magnificent This has been one of the really wonderful things for us and a great privilege for us to have been a sponsor of the Springbok. this has been one of the really wonderful things for us and a great privilege for us to have been a sponsor of the springbok You know, at the start, it was always a case of the Springbok being the one thing in this country that unites South Africa and pulls South Africa together, because if ever this country needed to start pulling together, it's now. you know at the start it was always a case of the springbok being the one thing in this country that unites south africa and pulls south africa together because if ever this country needed to start pulling together it's now That's why for us, in the first instance of the Springbok, it was more than just about sponsoring the Springbok. that's why for us in the first instance of the springbok it was more than just about sponsoring the springbok It was a symbolism of actually taking what it is that unites this country and brings it together and also making a statement that Pick n Pay is here. Pick n Pay is going nowhere. As we say, South Africa, we've got your back, and hopefully South Africa's got ours and is starting to show in the footfall in the stores. More importantly, it's not just about sponsoring the Springbok. It's about the work that's been done at grassroots level in rugby. We don't realize just how important rugby is amongst the youth in this country today. You can go across the length and breadth of South Africa and see how rugby is really becoming a force for good and a force for getting the country together. We're massively involved down at the grassroots level in rugby as well. It's fantastic. Just a couple of closing remarks here. It was a symbolism of actually taking what it is that unites this country and brings it together and also making a statement that Pick n Pay is here. it was a symbolism of actually taking what it is that unites this country and brings it together and also making a statement that pick n pay is here Pick n Pay is going nowhere. pick n pay is going nowhere As we say, South Africa, we've got your back, and hopefully South Africa's got ours and is starting to show in the footfall in the stores. as we say south africa we've got your back and hopefully south africa's got ours and is starting to show in the footfall in the stores More importantly, it's not just about sponsoring the Springbok. more importantly it's not just about sponsoring the springbok It's about the work that's been done at grassroots level in rugby. it's about the work that's been done at grassroots level in rugby We don't realize just how important rugby is amongst the youth in this country today. we don't realize just how important rugby is amongst the youth in this country today You can go across the length and breadth of South Africa and see how rugby is really becoming a force for good and a force for getting the country together. you can go across the length and breadth of south africa and see how rugby is really becoming a force for good and a force for getting the country together We're massively involved down at the grassroots level in rugby as well. we're massively involved down at the grassroots level in rugby as well It's fantastic. it's fantastic Just a couple of closing remarks here. just a couple of closing remarks here As I said in the beginning, our strategic priorities that we put in place, we've kind of been working our way through them, and we've got most of it ticked away. When we look at leadership and people, there's still obviously the issue of succession. I'm still here for another two and a half years, and it is something that is top of mind for us. We're busy working at all of our succession programs in that regard. Also about building leadership within the company from within the company again, because that's what retail is. It's about growing your own people. Accelerating our like-for-like sales, as I said, we're still working hard at that, and we'll continue to work hard at that. As I said in the beginning, our strategic priorities that we put in place, we've kind of been working our way through them, and we've got most of it ticked away. as i said in the beginning our strategic priorities that we put in place we've kind of been working our way through them and we've got most of it ticked away When we look at leadership and people, there's still obviously the issue of succession. when we look at leadership and people there's still obviously the issue of succession I'm still here for another two and a half years, and it is something that is top of mind for us. i'm still here for another two and a half years and it is something that is top of mind for us We're busy working at all of our succession programs in that regard. we're busy working at all of our succession programs in that regard Also about building leadership within the company from within the company again, because that's what retail is. also about building leadership within the company from within the company again because that's what retail is It's about growing your own people. it's about growing your own people Accelerating our like-for-like sales, as I said, we're still working hard at that, and we'll continue to work hard at that. accelerating our like-for-like sales as i said we're still working hard at that and we'll continue to work hard at that We continue to strengthen our partnerships across the Board and to work with our landlords very, very importantly, and to make sure that that moves in the right direction, as well as our supplier base. We reset the store estate. That's kind of done. The future-fit structure is still work that is underway. That's having a look at what are our store OpEx structures, what are our support OpEx structures, and those are things that are just work in motion as we go forward day-to-day. I really just want to thank all my colleagues in the company that I'm privileged to work with and to be a part of. I can feel, you know, I had an interview with Alec Hogg before I came here earlier this morning. We continue to strengthen our partnerships across the Board and to work with our landlords very, very importantly, and to make sure that that moves in the right direction, as well as our supplier base. we continue to strengthen our partnerships across the board and to work with our landlords very very importantly and to make sure that that moves in the right direction as well as our supplier base We reset the store estate. we reset the store estate That's kind of done. that's kind of done The future-fit structure is still work that is underway. the future-fit structure is still work that is underway That's having a look at what are our store OpEx structures, what are our support OpEx structures, and those are things that are just work in motion as we go forward day- to- day. that's having a look at what are our store opex structures what are our support opex structures and those are things that are just work in motion as we go forward day- to- day I really just want to thank all my colleagues in the company that I'm privileged to work with and to be a part of. i really just want to thank all my colleagues in the company that i'm privileged to work with and to be a part of I can feel, you know, I had an interview with Alec Hogg before I came here earlier this morning. i can feel you know i had an interview with alec hogg before i came here earlier this morning Alec asked me, you know, what does it feel like, Sean, when you're going to the company, when you're going to the stores, compared to when you came back two years ago? I think that I can say without any fear of doubt that this is a different company today. Are we where we want to be? Hell no. Are we well on the way on this journey? Absolutely. I've said before, this is like climbing Mount Everest. I said our journey is up Mount Everest. Alec asked me this morning, if you think of Table Mountain and not Mount Everest, where are you in Table Mountain? I said, Alec, we're solidly at the cable station at the bottom there. We've bought our ticket, and the cable car's on the way. We know where we're going, but we've got a journey to get there. We know what it looks like. Alec asked me, you know, what does it feel like, Sean, when you're going to the company, when you're going to the stores, compared to when you came back two years ago? alec asked me you know what does it feel like sean when you're going to the company when you're going to the stores compared to when you came back two years ago I think that I can say without any fear of doubt that this is a different company today. i think that i can say without any fear of doubt that this is a different company today Are we where we want to be? are we where we want to be Hell no. hell no Are we well on the way on this journey? are we well on the way on this journey Absolutely. absolutely I've said before, this is like climbing Mount Everest. i've said before this is like climbing mount everest I said our journey is up Mount Everest. i said our journey is up mount everest Alec asked me this morning, if you think of Table Mountain and not Mount Everest, where are you in Table Mountain? alec asked me this morning if you think of table mountain and not mount everest where are you in table mountain I said, Alec, we're solidly at the cable station at the bottom there. i said alec we're solidly at the cable station at the bottom there We've bought our ticket, and the cable car's on the way. we've bought our ticket and the cable car's on the way We know where we're going, but we've got a journey to get there. we know where we're going but we've got a journey to get there We know what it looks like. we know what it looks like We know how to get there. I want to thank everybody for their support, not only the people inside this company, but very, very importantly, the investors in this company who stay the hall with us, stay the long haul with us, the family, Wendy, Gareth, the Ackerman family, for the support that they've given, both myself and the company. It's a great privilege to stand here as CEO of this wonderful organization. Thank you very much. I don't know if there are any questions. Yes, sir. We know how to get there. we know how to get there I want to thank everybody for their support, not only the people inside this company, but very, very importantly, the investors in this company who stay the hall with us, stay the long haul with us, the family, Wendy, Gareth, the Ackerman family, for the support that they've given, both myself and the company. i want to thank everybody for their support not only the people inside this company but very very importantly the investors in this company who stay the hall with us stay the long haul with us the family wendy gareth the ackerman family for the support that they've given both myself and the company It's a great privilege to stand here as CEO of this wonderful organization. it's a great privilege to stand here as ceo of this wonderful organization Thank you very much. thank you very much I don't know if there are any questions. i don't know if there are any questions Yes, sir. yes sir Can you hear me? I'll speak for now. Can you hear me? can you hear me I'll speak for now. i'll speak for now Yeah. Yeah. yeah Thank you, Sean, Lerena. First of all, well done on the great work you've done so far in this later on strategy. It's been difficult decisions to make along the path. I think for the first one, you've mentioned a lot of you want to add new skills into the, or reintroduce the skills into the business. Could you elaborate on what skills you're looking for, what positions, and then how far along that journey are you? Do you still have a lot more people to hire? Thank you, Sean, Lerena. thank you sean lerena First of all, well done on the great work you've done so far in this later on strategy. first of all well done on the great work you've done so far in this later on strategy It's been difficult decisions to make along the path. it's been difficult decisions to make along the path I think for the first one, you've mentioned a lot of you want to add new skills into the, or reintroduce the skills into the business. i think for the first one you've mentioned a lot of you want to add new skills into the or reintroduce the skills into the business Could you elaborate on what skills you're looking for, what positions, and then how far along that journey are you? could you elaborate on what skills you're looking for what positions and then how far along that journey are you Do you still have a lot more people to hire? do you still have a lot more people to hire Yeah. The whole issue of skill, you know, retail is, it's a beautiful business. When you ask yourself the question, where do you find retailers? I mean, you can't go to a college, you can't go to a university and go and find retailers. Retail by its very nature is something that you learn on the job. We had, for a protracted period of time, done away with all of our training modules and our trainee manager programs that we had in place. Tembi's over here. Tembi heads up People for the group. We've reinstated all of these things back in. One day Wendy asked me the question, just put in sort of not simple terms, Wendy, but Wendy said, Sean, just try and give me an understanding of what's really happened in Pick n Pay. Yeah. yeah The whole issue of skill, you know, retail is, it's a beautiful business. the whole issue of skill you know retail is it's a beautiful business When you ask yourself the question, where do you find retailers? when you ask yourself the question where do you find retailers I mean, you can't go to a college, you can't go to a university and go and find retailers. i mean you can't go to a college you can't go to a university and go and find retailers Retail by its very nature is something that you learn on the job. retail by its very nature is something that you learn on the job We had, for a protracted period of time, done away with all of our training modules and our trainee manager programs that we had in place. we had for a protracted period of time done away with all of our training modules and our trainee manager programs that we had in place Tembi's over here. tembi's over here Tembi heads up People for the group. tembi heads up people for the group We've reinstated all of these things back in. we've reinstated all of these things back in One day Wendy asked me the question, just put in sort of not simple terms, Wendy, but Wendy said, Sean, just try and give me an understanding of what's really happened in Pick n Pay. one day wendy asked me the question just put in sort of not simple terms wendy but wendy said sean just try and give me an understanding of what's really happened in pick n pay I said, I'll give you an analogy that Raymond would understand because he was a keen golfer. In years by, if we went to our stores, our leadership teams in store levels were all good single handicap golfers. Today you go into stores and there are most probably 16, 18 handicaps, 20 handicap golfers. You can't blame the people because everybody starts, if you play golf, you start with a really lousy handicap and then you work on improving it. It's exactly the same in retail. It takes time to reinstall and reinstate these skills at store level. It's an operational thing at store level. It's a case of ownership that managers truly understand. This is my store. I take total responsibility for it. I said, I'll give you an analogy that Raymond would understand because he was a keen golfer. i said i'll give you an analogy that raymond would understand because he was a keen golfer In years by, if we went to our stores, our leadership teams in store levels were all good single handicap golfers. in years by if we went to our stores our leadership teams in store levels were all good single handicap golfers Today you go into stores and there are most probably 16, 18 handicaps, 20 handicap golfers. today you go into stores and there are most probably 16 18 handicaps 20 handicap golfers You can't blame the people because everybody starts, if you play golf, you start with a really lousy handicap and then you work on improving it. you can't blame the people because everybody starts if you play golf you start with a really lousy handicap and then you work on improving it It's exactly the same in retail. it's exactly the same in retail It takes time to reinstall and reinstate these skills at store level. it takes time to reinstall and reinstate these skills at store level It's an operational thing at store level. it's an operational thing at store level It's a case of ownership that managers truly understand. it's a case of ownership that managers truly understand This is my store. this is my store I take total responsibility for it. i take total responsibility for it You've got to find great bakers, great butchers, good blockmen, because these are the skills and the artisans that one needs to put back into the business again. Otherwise, what are you? You're not really doing a great job. We have to reinstate and rebuild all of those skills back into the business. We're making really good, solid progress now of creating these bases where we've taken in every single region now, we have identified stores where we're doing butchery training, bakery training. You've got to train these people and then you've got to make sure that they stay. You have to create an environment that makes sure that it's conducive for them not only to learn the skills, but that they don't get poached and leave. You've got to create an environment where they want to stay as well. You've got to find great bakers, great butchers, good blockmen, because these are the skills and the artisans that one needs to put back into the business again. you've got to find great bakers great butchers good blockmen because these are the skills and the artisans that one needs to put back into the business again Otherwise, what are you? otherwise what are you You're not really doing a great job. you're not really doing a great job We have to reinstate and rebuild all of those skills back into the business. we have to reinstate and rebuild all of those skills back into the business We're making really good, solid progress now of creating these bases where we've taken in every single region now, we have identified stores where we're doing butchery training, bakery training. we're making really good solid progress now of creating these bases where we've taken in every single region now we have identified stores where we're doing butchery training bakery training You've got to train these people and then you've got to make sure that they stay. you've got to train these people and then you've got to make sure that they stay You have to create an environment that makes sure that it's conducive for them not only to learn the skills, but that they don't get poached and leave. you have to create an environment that makes sure that it's conducive for them not only to learn the skills but that they don't get poached and leave You've got to create an environment where they want to stay as well. you've got to create an environment where they want to stay as well Somebody said to me once that, you know, you spend a lot of money on training. You know, is it really sort of, you know, worth it? I said, yeah, I think so. They said, what happens if you train them and they leave? I said, what happens if you don't train them and they stay? It's an investment that one needs to make, and we're on that journey. Somebody said to me once that, you know, you spend a lot of money on training. somebody said to me once that you know you spend a lot of money on training You know, is it really sort of, you know, worth it? you know is it really sort of you know worth it I said, yeah, I think so. i said yeah i think so They said, what happens if you train them and they leave? they said what happens if you train them and they leave I said, what happens if you don't train them and they stay? i said what happens if you don't train them and they stay It's an investment that one needs to make, and we're on that journey. it's an investment that one needs to make and we're on that journey Just on the franchise, the franchise is starting to pick up. Just on the franchise, the franchise is starting to pick up. just on the franchise the franchise is starting to pick up Yeah. Yeah. yeah We heard there was a new agreement that came in about a year and a half ago. Now there's another new agreement. What are the changes you've been making to reinforce that growth? We heard there was a new agreement that came in about a year and a half ago. we heard there was a new agreement that came in about a year and a half ago Now there's another new agreement. now there's another new agreement What are the changes you've been making to reinforce that growth? what are the changes you've been making to reinforce that growth The changes fundamentally for the franchise in that agreement really are just dealing with widening their margin. It's giving them more of a margin of profit for the individual franchisees and operators. When we have a look at our aging debt and stuff in franchise, we've got hold of that. It's in a much better way around than it has been for a long, long time. That's all to do with the health of their income statement at franchise level. That's where we've been applying a lot of attention. No further questions. Anything online? Tam, yes. The changes fundamentally for the franchise in that agreement really are just dealing with widening their margin. the changes fundamentally for the franchise in that agreement really are just dealing with widening their margin It's giving them more of a margin of profit for the individual franchisees and operators. it's giving them more of a margin of profit for the individual franchisees and operators When we have a look at our aging debt and stuff in franchise, we've got hold of that. when we have a look at our aging debt and stuff in franchise we've got hold of that It's in a much better way around than it has been for a long, long time. it's in a much better way around than it has been for a long long time That's all to do with the health of their income statement at franchise level. that's all to do with the health of their income statement at franchise level That's where we've been applying a lot of attention. that's where we've been applying a lot of attention No further questions. no further questions Anything online? anything online Tam, yes. tam yes

Speaker 1: A question from Paul Stehers. What is your outlook for Pick n Pay internal inflation for the remainder of the financial year? A question from Paul Stehers. a question from paul stehers What is your outlook for Pick n Pay internal inflation for the remainder of the financial year? what is your outlook for pick n pay internal inflation for the remainder of the financial year

Speaker 6: We're sitting at the moment at about 2.1%. Lerena, is that right? I forget. I have so many numbers in my head at the moment. We're sitting at about 2.1% at the moment. I think that one may see that there's certain commodities like rice and maize that are in fact coming down, which means that poultry prices should also come down. I think that inflation may actually go down. I think it may get closer to 1%. In some of the basic categories, you may even see it getting closer to a bit of deflation. If you look at the GDP, what is the GDP? It's about 0.6%. You clever people in the room should know this. I think that the forecast was to be circa 2.2% or 2.3%. We're sitting at the moment at about 2.1%. we're sitting at the moment at about 2.1% Lerena, is that right? lerena is that right I forget. I have so many numbers in my head at the moment. i forget. i have so many numbers in my head at the moment We're sitting at about 2.1% at the moment. we're sitting at about 2.1% at the moment I think that one may see that there's certain commodities like rice and maize that are in fact coming down, which means that poultry prices should also come down. i think that one may see that there's certain commodities like rice and maize that are in fact coming down which means that poultry prices should also come down I think that inflation may actually go down. i think that inflation may actually go down I think it may get closer to 1%. i think it may get closer to 1% In some of the basic categories, you may even see it getting closer to a bit of deflation. in some of the basic categories you may even see it getting closer to a bit of deflation If you look at the GDP, what is the GDP? if you look at the gdp what is the gdp It's about 0.6%. it's about 0.6% You clever people in the room should know this. you clever people in the room should know this I think that the forecast was to be circa 2.2% or 2.3%. i think that the forecast was to be circa 2.2% or 2.3% We can look just from that perspective as well as not only inflation down, which obviously creates another level of challenge for us, but the GDP is also down. I come back to this really, really constrained market. This market is tough. When you sit and speak to the major manufacturers, and I spend a lot of time talking to the big suppliers, all suppliers, for them, they look at the total market. If you speak to the two sugar suppliers, you've basically got sugar done. When you have a look at the total market and the dynamics that are there, there are certain categories in this country where people are trading down dramatically. We can see it in Boxer, where we can have a look at the profiles of what protein is being bought there. We can look just from that perspective as well as not only inflation down, which obviously creates another level of challenge for us, but the GDP is also down. we can look just from that perspective as well as not only inflation down which obviously creates another level of challenge for us but the gdp is also down I come back to this really, really constrained market. i come back to this really really constrained market This market is tough. this market is tough When you sit and speak to the major manufacturers, and I spend a lot of time talking to the big suppliers, all suppliers, for them, they look at the total market. when you sit and speak to the major manufacturers and i spend a lot of time talking to the big suppliers all suppliers for them they look at the total market If you speak to the two sugar suppliers, you've basically got sugar done. if you speak to the two sugar suppliers you've basically got sugar done When you have a look at the total market and the dynamics that are there, there are certain categories in this country where people are trading down dramatically. when you have a look at the total market and the dynamics that are there there are certain categories in this country where people are trading down dramatically We can see it in Boxer, where we can have a look at the profiles of what protein is being bought there. we can see it in boxer where we can have a look at the profiles of what protein is being bought there You can see that things like Russians, Viennas, Polonies, you can see how those are just soaring in terms of sales because people are just battling to afford normal protein, red meat and chicken. These are dynamics. The market is really constrained. Inflation, I think, will actually go down, not up, would be my prediction. You can see that things like Russians, Viennas, Polonies, you can see how those are just soaring in terms of sales because people are just battling to afford normal protein, red meat and chicken. you can see that things like russians viennas polonies you can see how those are just soaring in terms of sales because people are just battling to afford normal protein red meat and chicken These are dynamics. these are dynamics The market is really constrained. the market is really constrained Inflation, I think, will actually go down, not up, would be my prediction. inflation i think will actually go down not up would be my prediction

Speaker 1: Another question from Paul Stehers. Please, could you explain how you calculate your like-for-like growth for Pick? Do you strip out those stores that are to be closed or converted to Boxer? Another question from Paul Stehers. another question from paul stehers Please, could you explain how you calculate your like-for-like growth for Pick ? please could you explain how you calculate your like-for-like growth for pick Do you strip out those stores that are to be closed or converted to Boxer? do you strip out those stores that are to be closed or converted to boxer

Speaker 6: Yes, those come out, and like-for-like sales is purely like-for-like stores. That gets stripped out. Sorry, Lerena. Yes, those come out, and like-for-like sales is purely like-for-like stores. yes those come out and like-for-like sales is purely like-for-like stores That gets stripped out. that gets stripped out Sorry, Lerena. sorry lerena

Speaker 4: Sean, you pass the desk. Sean, you pass the desk. sean you pass the desk

Speaker 6: Checking with the headmistress here. Just checking with the headmistress, my Chief Sales Prevention Officer. This is. Checking with the headmistress here. checking with the headmistress here Just checking with the headmistress, my Chief Sales Prevention Officer. just checking with the headmistress my chief sales prevention officer This is. this is

Speaker 1: A question from Titanium Capital. The Pick n Pay gross margin is 16.9%. Can you please provide a separate gross margin percentage for corporate and franchise operations? A question from Titanium Capital. a question from titanium capital The Pick n Pay gross margin is 16.9%. the pick n pay gross margin is 16.9% Can you please provide a separate gross margin percentage for corporate and franchise operations? can you please provide a separate gross margin percentage for corporate and franchise operations

Speaker 6: No. You know, there's levels. When we come to segmental disclosure, there's levels that one goes to. I know that you'd like to have the P&L for every single service area and every single store and build it up from there, but that won't be happening anytime soon. No. no You know, there's levels. you know there's levels When we come to segmental disclosure, there's levels that one goes to. when we come to segmental disclosure there's levels that one goes to I know that you'd like to have the P&L for every single service area and every single store and build it up from there, but that won't be happening anytime soon. i know that you'd like to have the p&l for every single service area and every single store and build it up from there but that won't be happening anytime soon

Speaker 1: Noted. From Reuters. Could you please explain when the group expects to reach break-even and how this will be done? Noted. noted From Reuters. from reuters Could you please explain when the group expects to reach break-even and how this will be done? could you please explain when the group expects to reach break-even and how this will be done

Speaker 4: Our guidance is for us to get to those objectives by FY 2028. It will be done through the initiatives that actually are still projected on the slide. It effectively looks to growing the business through like-for-like sales as a first step. As I think both Sean and I have mentioned, the store closures are now largely in the base. From now on, one would start to see positive sales growth momentum. We have just improved our gross profit margin, and we do believe there is more to be had as we go on the journey. There are the initiatives across the entire expense base. The MOU that we've just signed with DP World is a very, very important strategic pillar. We expect to see those efficiencies coming through over the next 24 months as they unfold. It literally is driven by each of our future-fit initiatives. Our guidance is for us to get to those objectives by FY 2028. our guidance is for us to get to those objectives by fy 2028 It will be done through the initiatives that actually are still projected on the slide. it will be done through the initiatives that actually are still projected on the slide It effectively looks to growing the business through like-for-like sales as a first step. it effectively looks to growing the business through like-for-like sales as a first step As I think both Sean and I have mentioned, the store closures are now largely in the base. as i think both sean and i have mentioned the store closures are now largely in the base From now on, one would start to see positive sales growth momentum. from now on one would start to see positive sales growth momentum We have just improved our gross profit margin, and we do believe there is more to be had as we go on the journey. we have just improved our gross profit margin and we do believe there is more to be had as we go on the journey There are the initiatives across the entire expense base. there are the initiatives across the entire expense base The MOU that we've just signed with DP World is a very, very important strategic pillar. the mou that we've just signed with dp world is a very very important strategic pillar We expect to see those efficiencies coming through over the next 24 months as they unfold. we expect to see those efficiencies coming through over the next 24 months as they unfold It literally is driven by each of our future-fit initiatives. it literally is driven by each of our future-fit initiatives

Speaker 6: I think importantly, Lerena, to add to that, our margin has widened this year by the amount that it has. We've given more margin to our franchisees and we're absolutely price competitive in the marketplace. If you look at the independent pricing surveys that have been done, they all absolutely bear that out. It's not us marking our own homework, which would show you that 18-odd months ago, when I returned here 24 months ago, our buyers and merchants in the company were more focused on recovering money than actually trading. I said this must come to an end. We must get back to trading and buying and selling and doing what buyers should be doing. I think that this is most probably the greatest manifestation of the success that's been had in that regard. I think importantly, Lerena, to add to that, our margin has widened this year by the amount that it has. i think importantly lerena to add to that our margin has widened this year by the amount that it has We've given more margin to our franchisees and we're absolutely price competitive in the marketplace. we've given more margin to our franchisees and we're absolutely price competitive in the marketplace If you look at the independent pricing surveys that have been done, they all absolutely bear that out. if you look at the independent pricing surveys that have been done they all absolutely bear that out It's not us marking our own homework, which would show you that 18-odd months ago, when I returned here 24 months ago, our buyers and merchants in the company were more focused on recovering money than actually trading. it's not us marking our own homework which would show you that 18-odd months ago when i returned here 24 months ago our buyers and merchants in the company were more focused on recovering money than actually trading I said this must come to an end. i said this must come to an end We must get back to trading and buying and selling and doing what buyers should be doing. we must get back to trading and buying and selling and doing what buyers should be doing I think that this is most probably the greatest manifestation of the success that's been had in that regard. i think that this is most probably the greatest manifestation of the success that's been had in that regard We're just back to being good basic retailers again when it comes to buying and selling. We're just back to being good basic retailers again when it comes to buying and selling. we're just back to being good basic retailers again when it comes to buying and selling

Speaker 1: Question from David Fraser at Peregrine. From a strategic point of view, do you envisage holding onto the Boxer stake indefinitely or would you consider unbundling it down the line? Question from David Fraser at Peregrine. question from david fraser at peregrine From a strategic point of view, do you envisage holding onto the Boxer stake indefinitely or would you consider unbundling it down the line? from a strategic point of view do you envisage holding onto the boxer stake indefinitely or would you consider unbundling it down the line

Speaker 4: We are very, very happy with the Boxer performance, and we are very, very happy to own 65.6% of Boxer. As a matter of fact, you know, we would have loved to have still 100%. We are definitely very happy with the performance and what the team is delivering for Pick n Pay shareholders. We are very, very happy with the Boxer performance, and we are very, very happy to own 65.6% of Boxer. we are very very happy with the boxer performance and we are very very happy to own 65.6% of boxer As a matter of fact, you know, we would have loved to have still 100%. as a matter of fact you know we would have loved to have still 100% We are definitely very happy with the performance and what the team is delivering for Pick n Pay shareholders. we are definitely very happy with the performance and what the team is delivering for pick n pay shareholders

Speaker 1: Another question from Cabela Moshecha. Post the completion of the hiring process, will the like-for-like employee cost growth revert closer to inflationary levels? Is there more investment required post this period? Another question from Cabela Moshecha. another question from cabela moshecha Post the completion of the hiring process, will the like-for-like employee cost growth revert closer to inflationary levels? post the completion of the hiring process will the like-for-like employee cost growth revert closer to inflationary levels Is there more investment required post this period? is there more investment required post this period

Speaker 4: I think the way you need to think about it is our objective to get our like-for-like expense growth below our like-for-like turnover growth. That is what our key initiatives will deliver, and that will include efficiencies in employee costs. Sean spoke to support office initiatives, looking at efficiencies in store, et cetera. As this unfolds over the period of the plan, you would see that like-for-like number coming down. I think the way you need to think about it is our objective to get our like-for-like expense growth below our like-for-like turnover growth. i think the way you need to think about it is our objective to get our like-for-like expense growth below our like-for-like turnover growth That is what our key initiatives will deliver, and that will include efficiencies in employee costs. that is what our key initiatives will deliver and that will include efficiencies in employee costs Sean spoke to support office initiatives, looking at efficiencies in store, et cetera. sean spoke to support office initiatives looking at efficiencies in store et cetera As this unfolds over the period of the plan, you would see that like-for-like number coming down. as this unfolds over the period of the plan you would see that like-for-like number coming down

Speaker 1: A question from [Priyotha Drozd] from Varushan Fund Management. Would you be willing to consider a Pick n Pay share buyback as the turnaround strategy continues delivering results? A question from [Priyotha Drozd] from Varushan Fund Management. a question from [priyotha drozd] from varushan fund management Would you be willing to consider a Pick n Pay share buyback as the turnaround strategy continues delivering results? would you be willing to consider a pick n pay share buyback as the turnaround strategy continues delivering results

Speaker 4: I think where we are currently, we are focusing on our target to get the business to cash flow break even. Once we have achieved that, one will consider future options. I think where we are currently, we are focusing on our target to get the business to cash flow break even. i think where we are currently we are focusing on our target to get the business to cash flow break even Once we have achieved that, one will consider future options. once we have achieved that one will consider future options

Speaker 6: I think one must also add to that that as we get back into a stronger financial health and cash generative again, we need to continue investing inside the company and getting our estate back to the condition that it needs to be in. I think one must also add to that that as we get back into a stronger financial health and cash generative again, we need to continue investing inside the company and getting our estate back to the condition that it needs to be in. i think one must also add to that that as we get back into a stronger financial health and cash generative again we need to continue investing inside the company and getting our estate back to the condition that it needs to be in

Speaker 1: Question from [Kuba Salir] from Value Capital Partners. Wanted to know something about the overlaps between Pick n Pay and Boxer. Given the procurement processes for the two companies are independent, are there any specific important overlaps between the two entities? Question from [Kuba Salir] from Value Capital Partners. question from [kuba salir] from value capital partners Wanted to know something about the overlaps between Pick n Pay and Boxer. wanted to know something about the overlaps between pick n pay and boxer Given the procurement processes for the two companies are independent, are there any specific important overlaps between the two entities? given the procurement processes for the two companies are independent are there any specific important overlaps between the two entities

Speaker 6: No. One of the things that we did is drew a real clear line between what Boxer does and what Pick n Pay does. Boxer's philosophy, how they buy, how they go-to-market, is so far away from what Pick n Pay does. We don't want to mix. We don't want to confuse that in any way, shape, or form. On a piece of paper, sometimes these things look like they make sense. In reality, when you actually come to implement it, it doesn't work. No. no One of the things that we did is drew a real clear line between what Boxer does and what Pick n Pay does. one of the things that we did is drew a real clear line between what boxer does and what pick n pay does Boxer's philosophy, how they buy, how they go- to- market, is so far away from what Pick n Pay does. boxer's philosophy how they buy how they go- to- market is so far away from what pick n pay does We don't want to mix. we don't want to mix We don't want to confuse that in any way, shape, or form. we don't want to confuse that in any way shape or form On a piece of paper, sometimes these things look like they make sense. on a piece of paper sometimes these things look like they make sense In reality, when you actually come to implement it, it doesn't work. in reality when you actually come to implement it it doesn't work

Speaker 1: Another question from Paul Stehers. Please talk to the additional investments you have to make that cause Pick segment loss to not improve in FY 2026 versus FY 2025. Another question from Paul Stehers. another question from paul stehers Please talk to the additional investments you have to make that cause Pick segment loss to not improve in FY 2026 versus FY 2025. please talk to the additional investments you have to make that cause pick segment loss to not improve in fy 2026 versus fy 2025

Speaker 4: I mean, I think we have discussed them now in the Q&A. Largely, a lot of them will definitely be the key skills we need at an operational level to ensure that the in-store execution keeps on driving our like-for-like sales. I mean, I think we have discussed them now in the Q&A. i mean i think we have discussed them now in the q&a Largely, a lot of them will definitely be the key skills we need at an operational level to ensure that the in-store execution keeps on driving our like-for-like sales. largely a lot of them will definitely be the key skills we need at an operational level to ensure that the in-store execution keeps on driving our like-for-like sales

Speaker 1: Question from Ya'eesh Patel at SBG Securities. Please, can you speak to the CapEx cadence in the Pick n Pay stable? Is there not an element of underinvestment which could bite over the medium-term? How should we think about this? Question from Ya'eesh Patel at SBG Securities. question from ya'eesh patel at sbg securities Please, can you speak to the CapEx cadence in the Pick n Pay stable? please can you speak to the capex cadence in the pick n pay stable Is there not an element of underinvestment which could bite over the medium- term? is there not an element of underinvestment which could bite over the medium- term How should we think about this? how should we think about this

Speaker 4: We are very, very careful to ensure that we spend where we get returns. The question is a very valid one. We also need to make sure that our operational excellence on a ground level is established to ensure that we get the returns. We are measured still in our spending, but we have got the ZAR 3.9 billion on balance sheet, and where we believe that it can unlock returns, we will definitely spend the money. We are very, very careful to ensure that we spend where we get returns. we are very very careful to ensure that we spend where we get returns The question is a very valid one. the question is a very valid one We also need to make sure that our operational excellence on a ground level is established to ensure that we get the returns. we also need to make sure that our operational excellence on a ground level is established to ensure that we get the returns We are measured still in our spending, but we have got the ZAR 3.9 billion on balance sheet, and where we believe that it can unlock returns, we will definitely spend the money. we are measured still in our spending but we have got the zar 3.9 billion on balance sheet and where we believe that it can unlock returns we will definitely spend the money

Speaker 6: I think another point to that, Lerena, is it's not just about spending money on stores. You know, you can build the greatest brand new, swanky store, but if you don't have the right people in the store and the product's not there, you're still not going to do the business. It's not that the whole of the Pick n Pay real estate is broken. Not at all. I mean, we have a lot of great stores in this company. Certainly, there are some key stores that need some work done to them. That is an absolute fact. I mean, there's also a big chunk of our estate that's great. We mustn't have a look at Pick n Pay and think that the whole thing is broken. It ain't. I think another point to that, Lerena, is it's not just about spending money on stores. i think another point to that lerena is it's not just about spending money on stores You know, you can build the greatest brand new, swanky store, but if you don't have the right people in the store and the product's not there, you're still not going to do the business. you know you can build the greatest brand new swanky store but if you don't have the right people in the store and the product's not there you're still not going to do the business It's not that the whole of the Pick n Pay real estate is broken. it's not that the whole of the pick n pay real estate is broken Not at all. not at all I mean, we have a lot of great stores in this company. i mean we have a lot of great stores in this company Certainly, there are some key stores that need some work done to them. certainly there are some key stores that need some work done to them That is an absolute fact. that is an absolute fact I mean, there's also a big chunk of our estate that's great. i mean there's also a big chunk of our estate that's great We mustn't have a look at Pick n Pay and think that the whole thing is broken. we mustn't have a look at pick n pay and think that the whole thing is broken It ain't. it ain't

Speaker 1: Another question here. What is your view on the amount that is being spent on online gambling and its impact on disposable income? Another question here. another question here What is your view on the amount that is being spent on online gambling and its impact on disposable income? what is your view on the amount that is being spent on online gambling and its impact on disposable income

Speaker 6: This is a really, really current topic, and one can see that there's been commentary from virtually every financial institution. There's been so much talk about it. I think context is always important. If we have a look at the, I don't know, ZAR 1.6 or ZAR 1.7 trillion that is churned over in the space of gambling in South Africa, there's somewhere north of about ZAR 70 billion that is being taken out of this market at the moment in terms of profits that are being taken in the gambling industry, the bulk of which is in the online gambling space, not in the casinos and horse racing and the like, where employment is created, at least in casinos. You've got hotel rooms and crew pairs and cleaners and all of that. In the horse racing industry, you've got a whole industry there. This is a really, really current topic, and one can see that there's been commentary from virtually every financial institution. this is a really really current topic and one can see that there's been commentary from virtually every financial institution There's been so much talk about it. there's been so much talk about it I think context is always important. i think context is always important If we have a look at the, I don't know, ZAR 1.6 or ZAR 1.7 trillion that is churned over in the space of gambling in South Africa, there's somewhere north of about ZAR 70 billion that is being taken out of this market at the moment in terms of profits that are being taken in the gambling industry, the bulk of which is in the online gambling space, not in the casinos and horse racing and the like, where employment is created, at least in casinos. if we have a look at the i don't know zar 1.6 or zar 1.7 trillion that is churned over in the space of gambling in south africa there's somewhere north of about zar 70 billion that is being taken out of this market at the moment in terms of profits that are being taken in the gambling industry the bulk of which is in the online gambling space not in the casinos and horse racing and the like where employment is created at least in casinos You've got hotel rooms and crew pairs and cleaners and all of that. you've got hotel rooms and crew pairs and cleaners and all of that In the horse racing industry, you've got a whole industry there. in the horse racing industry you've got a whole industry there If one looks at online gambling, they don't create any jobs. These program writers are all sitting in other places offshore. ZAR 70 billion a year. If you think of ZAR 70 billion a year, that's basically Pick n Pay's total revenue. We're still a big company. It's the equivalent of everything that's sold by Pick n Pay. It's taken out by a few people in profit every year in a highly constrained market. It's over ZAR 1 billion a week is just being hoovered out of the economy. It's difficult. On a lot of the research work that's been done by some of the institutions, it would appear that north of 20% of SASSA grants are going straight into gambling. It's horrendous. It's horrendous. Now, how does one deal with it? If one looks at online gambling, they don't create any jobs. if one looks at online gambling they don't create any jobs These program writers are all sitting in other places offshore. these program writers are all sitting in other places offshore ZAR 70 billion a year. zar 70 billion a year If you think of ZAR 70 billion a year, that's basically Pick n Pay's total revenue. if you think of zar 70 billion a year that's basically pick n pay's total revenue We're still a big company. we're still a big company It's the equivalent of everything that's sold by Pick n Pay. it's the equivalent of everything that's sold by pick n pay It's taken out by a few people in profit every year in a highly constrained market. it's taken out by a few people in profit every year in a highly constrained market It's over ZAR 1 billion a week is just being hoovered out of the economy. it's over zar 1 billion a week is just being hoovered out of the economy It's difficult. it's difficult On a lot of the research work that's been done by some of the institutions, it would appear that north of 20% of SASSA grants are going straight into gambling. on a lot of the research work that's been done by some of the institutions it would appear that north of 20% of sassa grants are going straight into gambling It's horrendous. it's horrendous It's horrendous. it's horrendous Now, how does one deal with it? now how does one deal with it Smoking was a cancer, and then one of the ways that they dealt with it was that they banned all marketing and promoting of cigarette products and tobacco products. I think we need to give serious consideration in this country to a similar move, that all marketing and advertising should be banned forthwith, the same as you did with smoking. It's not a crazy thought. You look in Europe, in Belgium, Holland, Italy, there's no marketing of gambling. It's illegal. Even if you look in the United Kingdom, from next year it now will be not possible to put a gambling logo on the front of a soccer jersey. Even in countries like the U.K., it's starting to move. I think this is an industry that is totally out of control. Smoking was a cancer, and then one of the ways that they dealt with it was that they banned all marketing and promoting of cigarette products and tobacco products. smoking was a cancer and then one of the ways that they dealt with it was that they banned all marketing and promoting of cigarette products and tobacco products I think we need to give serious consideration in this country to a similar move, that all marketing and advertising should be banned forthwith, the same as you did with smoking. i think we need to give serious consideration in this country to a similar move that all marketing and advertising should be banned forthwith the same as you did with smoking It's not a crazy thought. it's not a crazy thought You look in Europe, in Belgium, Holland, Italy, there's no marketing of gambling. you look in europe in belgium holland italy there's no marketing of gambling It's illegal. it's illegal Even if you look in the United Kingdom, from next year it now will be not possible to put a gambling logo on the front of a soccer jersey. even if you look in the united kingdom from next year it now will be not possible to put a gambling logo on the front of a soccer jersey Even in countries like the U.K., it's starting to move. even in countries like the u.k it's starting to move I think this is an industry that is totally out of control. i think this is an industry that is totally out of control I think that the poor and the vulnerable, and you know, even kids, I mean, all you need is your mom and dad's ID number, sign up on the app, put in the ID number, and you're off to the races. I speak to people that are teachers at schools and what have you, and they tell me about the stress that's happening amongst kids, where kids are sitting at school gambling on the apps on the phone. It's a problem. It's a huge problem. I think a serious consideration needs to be given to what is actually happening inside society in this regard. It's not just about the greed of chasing the profit. I think that the poor and the vulnerable, and you know, even kids, I mean, all you need is your mom and dad's ID number, sign up on the app, put in the ID number, and you're off to the races. i think that the poor and the vulnerable and you know even kids i mean all you need is your mom and dad's id number sign up on the app put in the id number and you're off to the races I speak to people that are teachers at schools and what have you, and they tell me about the stress that's happening amongst kids, where kids are sitting at school gambling on the apps on the phone. i speak to people that are teachers at schools and what have you and they tell me about the stress that's happening amongst kids where kids are sitting at school gambling on the apps on the phone It's a problem. it's a problem It's a huge problem. it's a huge problem I think a serious consideration needs to be given to what is actually happening inside society in this regard. i think a serious consideration needs to be given to what is actually happening inside society in this regard It's not just about the greed of chasing the profit. it's not just about the greed of chasing the profit

Speaker 1: A question from Nick Webster at HSBC. There's no mention of liquor performance in the presentation. Could you give us some color here, and if it's accretive to the Pick n Pay like-for-likes? A question from Nick Webster at HSBC. a question from nick webster at hsbc There's no mention of liquor performance in the presentation. there's no mention of liquor performance in the presentation Could you give us some color here, and if it's accretive to the Pick n Pay like-for-likes? could you give us some color here and if it's accretive to the pick n pay like-for-likes

Speaker 6: Yeah, Pick n Pay liquor like-for-like sales continue at a similar pace as the rest of our like-for-like sales, and liquor continues to grow. It's also a fantastic category for us. We just wanted in this presentation not to get too granular in terms of calling out everything and just really get to the headline stuff that really people want to know about. That is what's happening to the core underlying Pick n Pay at a top line level. Yeah, Pick n Pay liquor like-for-like sales continue at a similar pace as the rest of our like-for-like sales, and liquor continues to grow. yeah pick n pay liquor like-for-like sales continue at a similar pace as the rest of our like-for-like sales and liquor continues to grow It's also a fantastic category for us. it's also a fantastic category for us We just wanted in this presentation not to get too granular in terms of calling out everything and just really get to the headline stuff that really people want to know about. we just wanted in this presentation not to get too granular in terms of calling out everything and just really get to the headline stuff that really people want to know about That is what's happening to the core underlying Pick n Pay at a top line level. that is what's happening to the core underlying pick n pay at a top line level

Speaker 1: Another question from Johannesburg. What is your opinion on Walmart entering the South African market? What do you believe will be the impact on S.A. retail in the short-term? Another question from Johannesburg. another question from johannesburg What is your opinion on Walmart entering the South African market? what is your opinion on walmart entering the south african market What do you believe will be the impact on S.A. retail in the short- term? what do you believe will be the impact on s.a retail in the short- term

Speaker 6: I think it came about 17 years ago, 16 years ago, didn't they? They arrived here 16 or 17 years ago. It's not like they've just arrived and cleared customs. I know it's quite slow to get through the airport, but they've been here for a while. It would appear at this stage, and one is never sanguine about these things because they obviously are a mighty force globally. From the stores that we've seen that have been identified, it's more of a rebranding exercise than anything else. It would appear that there's some of the real estate that they'll rebrand, and we'll keep an eye on them. They've always been here, always been here. I think it came about 17 years ago, 16 years ago, didn't they? i think it came about 17 years ago 16 years ago didn't they They arrived here 16 or 17 years ago. they arrived here 16 or 17 years ago It's not like they've just arrived and cleared customs. it's not like they've just arrived and cleared customs I know it's quite slow to get through the airport, but they've been here for a while. i know it's quite slow to get through the airport but they've been here for a while It would appear at this stage, and one is never sanguine about these things because they obviously are a mighty force globally. it would appear at this stage and one is never sanguine about these things because they obviously are a mighty force globally From the stores that we've seen that have been identified, it's more of a rebranding exercise than anything else. from the stores that we've seen that have been identified it's more of a rebranding exercise than anything else It would appear that there's some of the real estate that they'll rebrand, and we'll keep an eye on them. it would appear that there's some of the real estate that they'll rebrand and we'll keep an eye on them They've always been here, always been here. they've always been here always been here

Speaker 1: Another question from Ya'eesh Patel at SBG. Please, can you speak to any dynamics over the past six months in the chicken category? Any shortages for Pick n Pay experienced? Another question from Ya'eesh Patel at SBG. another question from ya'eesh patel at sbg Please, can you speak to any dynamics over the past six months in the chicken category? please can you speak to any dynamics over the past six months in the chicken category Any shortages for Pick n Pay experienced? any shortages for pick n pay experienced

Speaker 6: Yeah, we had the problem with the MDM issue out of Brazil because, you know, a lot of product that comes into this country, MDM is the backbone of what happens for the lower-end proteins, Russians, Viennas, Polonies, and all of that. That has a profound effect on that. Obviously, chicken feet as well is a massive piece of the market for Boxer and the like, and even in some of our Pick n Pay stores. On poultry in general, you know, we had the foot-and-mouth issue on red meat. We had a spike in red meat prices, which obviously then put more pressure on poultry. We had poultry shortages. The poultry market has been under a lot of pressure as well. Yeah, we had the problem with the MDM issue out of Brazil because, you know, a lot of product that comes into this country, MDM is the backbone of what happens for the lower-end proteins, Russians, Viennas, Polonies, and all of that. yeah we had the problem with the mdm issue out of brazil because you know a lot of product that comes into this country mdm is the backbone of what happens for the lower-end proteins russians viennas polonies and all of that That has a profound effect on that. that has a profound effect on that Obviously, chicken feet as well is a massive piece of the market for Boxer and the like, and even in some of our Pick n Pay stores. obviously chicken feet as well is a massive piece of the market for boxer and the like and even in some of our pick n pay stores On poultry in general, you know, we had the foot-and-mouth issue on red meat. on poultry in general you know we had the foot-and-mouth issue on red meat We had a spike in red meat prices, which obviously then put more pressure on poultry. we had a spike in red meat prices which obviously then put more pressure on poultry We had poultry shortages. we had poultry shortages The poultry market has been under a lot of pressure as well. the poultry market has been under a lot of pressure as well

Speaker 1: Question from [Keenan] at Investec. Are you seeing a highly promotional environment in Pick n Pay Clothing? Question from [Keenan] at Investec. question from [keenan] at investec Are you seeing a highly promotional environment in Pick n Pay Clothing? are you seeing a highly promotional environment in pick n pay clothing

Speaker 6: You know, the clothing market is interesting because obviously you've got our friends from Shein and the like that are sort of playing silently in this space, but growing enormous volumes in this country, absolutely enormous volumes. If we have a look at our clothing offer within Pick n Pay, we're really not that promotional because, I mean, when I say we're not that promotional, we have a value proposition and we present fair value to the consumer. Our clothing is not massively price-driven. The textile market, as you know, you can see from the results of the other retailers, has been under pressure in the last while. It's going to be interesting to see, as I say, as we annualize through the two-pot system now, because a lot of the two-pot spending that actually went back into the market didn't really go into food. You know, the clothing market is interesting because obviously you've got our friends from Shein and the like that are sort of playing silently in this space, but growing enormous volumes in this country, absolutely enormous volumes. you know the clothing market is interesting because obviously you've got our friends from shein and the like that are sort of playing silently in this space but growing enormous volumes in this country absolutely enormous volumes If we have a look at our clothing offer within Pick n Pay, we're really not that promotional because, I mean, when I say we're not that promotional, we have a value proposition and we present fair value to the consumer. if we have a look at our clothing offer within pick n pay we're really not that promotional because i mean when i say we're not that promotional we have a value proposition and we present fair value to the consumer Our clothing is not massively price-driven. our clothing is not massively price-driven The textile market, as you know, you can see from the results of the other retailers, has been under pressure in the last while. the textile market as you know you can see from the results of the other retailers has been under pressure in the last while It's going to be interesting to see, as I say, as we annualize through the two-pot system now, because a lot of the two-pot spending that actually went back into the market didn't really go into food. it's going to be interesting to see as i say as we annualize through the two-pot system now because a lot of the two-pot spending that actually went back into the market didn't really go into food A lot of it went more into sort of clothing and housewares. Let's see how that annualizes out. A lot of it went more into sort of clothing and housewares. a lot of it went more into sort of clothing and housewares Let's see how that annualizes out. let's see how that annualizes out

Speaker 1: Question from Thishan Govinder, at Truffle Asset Management. Any guidance on when core Pick n Pay is expected to be free cash flow neutral? What is the top line like-for-like, gross profit margin, and OpEx needed to get there? Question from Thishan Govinder, at Truffle Asset Management. question from thishan govinder at truffle asset management Any guidance on when core Pick n Pay is expected to be free cash flow neutral? any guidance on when core pick n pay is expected to be free cash flow neutral What is the top line like-for-like, gross profit margin, and OpEx needed to get there? what is the top line like-for-like gross profit margin and opex needed to get there

Speaker 4: Shall I just pull out my spreadsheet, Sean? Shall I just pull out my spreadsheet, Sean? shall i just pull out my spreadsheet sean

Speaker 6: Yeah. Yeah. yeah

Speaker 4: It's in the dictionary under N. Our guidance remains on the full cash burn for the Pick n Pay segment towards FY 2028. Ultimately, the way you need to think about it is that we need to get our trading profit after lease margin to zero. To do that, about half we believe will come from our gross profit and the other half from our trading expenses. It's in the dictionary under N. it's in the dictionary under n Our guidance remains on the full cash burn for the Pick n Pay segment towards FY 2028. our guidance remains on the full cash burn for the pick n pay segment towards fy 2028 Ultimately, the way you need to think about it is that we need to get our trading profit after lease margin to zero. ultimately the way you need to think about it is that we need to get our trading profit after lease margin to zero To do that, about half we believe will come from our gross profit and the other half from our trading expenses. to do that about half we believe will come from our gross profit and the other half from our trading expenses

Speaker 1: A question from Citi. Can you provide some color on clothing post-period trade? A question from Citi. a question from citi Can you provide some color on clothing post-period trade? can you provide some color on clothing post-period trade

Speaker 6: Our clothing post-period trade continues to show the similar trend pre. We haven't seen any marked drop-off from before. We're really, really happy with the progress that Hazel's making, the new stores that are opening. From an excess merchandise markdown perspective, we've really done a great job of getting ourselves a lot more efficient and cleaner in that area. We're very positive about where we are at the moment in our clothing business. Obviously, the Springbok Apparel and Merchandise is another great thing for us in that area. We do an unbelievable amount of business in Springbok Apparel and Merchandise. Our clothing post-period trade continues to show the similar trend pre. our clothing post-period trade continues to show the similar trend pre We haven't seen any marked drop-off from before. we haven't seen any marked drop-off from before We're really, really happy with the progress that Hazel's making, the new stores that are opening. we're really really happy with the progress that hazel's making the new stores that are opening From an excess merchandise markdown perspective, we've really done a great job of getting ourselves a lot more efficient and cleaner in that area. from an excess merchandise markdown perspective we've really done a great job of getting ourselves a lot more efficient and cleaner in that area We're very positive about where we are at the moment in our clothing business. we're very positive about where we are at the moment in our clothing business Obviously, the Springbok Apparel and Merchandise is another great thing for us in that area. obviously the springbok apparel and merchandise is another great thing for us in that area We do an unbelievable amount of business in Springbok Apparel and Merchandise. we do an unbelievable amount of business in springbok apparel and merchandise

Speaker 1: I have two more questions. One from Daniel at Ashburton. Could you speak to the outlook for cost growth into H2, including Boxer? I have two more questions. i have two more questions One from Daniel at Ashburton. one from daniel at ashburton Could you speak to the outlook for cost growth into H2, including Boxer? could you speak to the outlook for cost growth into h2 including boxer

Speaker 4: Boxer will continue to grow as they're opening their store estate. You will see similar levels of growth in the Boxer business. I think the Pick n Pay shape will also reflect the first half. Boxer will continue to grow as they're opening their store estate. boxer will continue to grow as they're opening their store estate You will see similar levels of growth in the Boxer business. you will see similar levels of growth in the boxer business I think the Pick n Pay shape will also reflect the first half. i think the pick n pay shape will also reflect the first half

Speaker 1: A last question from Nick Webster at HSBC. Could you comment a bit more on your enhanced private label offering in terms of categories and current penetration to Pick n Pay? A last question from Nick Webster at HSBC. a last question from nick webster at hsbc Could you comment a bit more on your enhanced private label offering in terms of categories and current penetration to Pick n Pay? could you comment a bit more on your enhanced private label offering in terms of categories and current penetration to pick n pay

Speaker 6: Yeah, certainly. We've done a lot of work in the last while of cleaning out a lot of house brand product that was in store that was not particularly well conceived at the point in time when those ranges are put together. We've taken No Name brand again, and again we've cleaned up the No Name and brand range. We've got a lot of items that should never have been a No Name and brand. No Name and brand was always understood to be in certain categories and in certain commodity groups and present a certain value profile to our customers. We're busy refocusing that again at the moment. Yeah, certainly. yeah certainly We've done a lot of work in the last while of cleaning out a lot of house brand product that was in store that was not particularly well conceived at the point in time when those ranges are put together. we've done a lot of work in the last while of cleaning out a lot of house brand product that was in store that was not particularly well conceived at the point in time when those ranges are put together We've taken No Name brand again, and again we've cleaned up the No Name and brand range. we've taken no name brand again and again we've cleaned up the no name and brand range We've got a lot of items that should never have been a No Name and brand. No Name and brand was always understood to be in certain categories and in certain commodity groups and present a certain value profile to our customers. we've got a lot of items that should never have been a no name and brand. no name and brand was always understood to be in certain categories and in certain commodity groups and present a certain value profile to our customers We're busy refocusing that again at the moment. we're busy refocusing that again at the moment We've got new packaging that's going to be coming forward that will be taking us and really putting No Name brand back as the hero that it should be and a very, very well-known house brand in the country, one of the leading ones. On the Pick n Pay brand specifically and Live Well, there's work that's been done behind the scenes there as well. As I say, we've been getting cleared of a lot of product that was just not really serving the purpose that it should serve. I think within the next 12-18 to 24 months, you will see quite a radically revamped and repositioned house brand range in the market. Our front door always in this company has been branded goods, you know, at prices really low. That's always been the key hallmark of our success in the company, and that's our backbone. We've got new packaging that's going to be coming forward that will be taking us and really putting No Name brand back as the hero that it should be and a very, very well-known house brand in the country, one of the leading ones. we've got new packaging that's going to be coming forward that will be taking us and really putting no name brand back as the hero that it should be and a very very well-known house brand in the country one of the leading ones On the Pick n Pay brand specifically and Live Well, there's work that's been done behind the scenes there as well. on the pick n pay brand specifically and live well there's work that's been done behind the scenes there as well As I say, we've been getting cleared of a lot of product that was just not really serving the purpose that it should serve. as i say we've been getting cleared of a lot of product that was just not really serving the purpose that it should serve I think within the next 12- 18 to 24 months, you will see quite a radically revamped and repositioned house brand range in the market. i think within the next 12- 18 to 24 months you will see quite a radically revamped and repositioned house brand range in the market Our front door always in this company has been branded goods, you know, at prices really low. our front door always in this company has been branded goods you know at prices really low That's always been the key hallmark of our success in the company, and that's our backbone. that's always been the key hallmark of our success in the company and that's our backbone Your house brand sits on the side of that and performs a very, very important function. Obviously on the other side of that is Fresh, which obviously a lot of that is house brand just by nature, but a massive amount of energy and effort going into Fresh. A lot of stuff happening. Your house brand sits on the side of that and performs a very, very important function. your house brand sits on the side of that and performs a very very important function Obviously on the other side of that is Fresh, which obviously a lot of that is house brand just by nature, but a massive amount of energy and effort going into Fresh. obviously on the other side of that is fresh which obviously a lot of that is house brand just by nature but a massive amount of energy and effort going into fresh A lot of stuff happening. a lot of stuff happening

Speaker 1: Come in from David Fraser at Peregrine. Is Pick n Pay core profitability during or at the end of 2028? Come in from David Fraser at Peregrine. come in from david fraser at peregrine Is Pick n Pay core profitability during or at the end of 2028? is pick n pay core profitability during or at the end of 2028

Speaker 4: During. During. during

Speaker 6: Morning, David. Hi. Morning, David. morning david Hi. hi It's Chris Logan. Very well done on all the notable improvements. If we consider the competitive environment you faced with and your trading expenses as a percentage of sales at 22.2%, they're very high historically, and they're high in relation to your GP of 16.9%. Are you not going to need to take more radical steps to get your trading expenses in line? It's Chris Logan. it's chris logan Very well done on all the notable improvements. very well done on all the notable improvements If we consider the competitive environment you faced with and your trading expenses as a percentage of sales at 22.2%, they're very high historically, and they're high in relation to your GP of 16.9%. if we consider the competitive environment you faced with and your trading expenses as a percentage of sales at 22.2% they're very high historically and they're high in relation to your gp of 16.9% Are you not going to need to take more radical steps to get your trading expenses in line? are you not going to need to take more radical steps to get your trading expenses in line You see, the critical thing, and thanks for that question, because that's the vital journey that we're on. The two key metrics in this business obviously are your top line sales and then your margin, and then obviously your trading expenses. Your trading expenses, if you look at your trading expenses, a lot of them are not that variable. When you take cost of occupancy and rates and taxes and rents and all of those kind of things, a lot of that outflow, the only real variable you got there is kind of sort of your wages and stuff that you know you can flex. Yeah, it's absolutely the nub of where we are. Top line is everything because if you lose the momentum on the top line, there's no way that you can cut your expenses as a rate to offset loss of momentum at the top line level. You see, the critical thing, and thanks for that question, because that's the vital journey that we're on. you see the critical thing and thanks for that question because that's the vital journey that we're on The two key metrics in this business obviously are your top line sales and then your margin, and then obviously your trading expenses. the two key metrics in this business obviously are your top line sales and then your margin and then obviously your trading expenses Your trading expenses, if you look at your trading expenses, a lot of them are not that variable. your trading expenses if you look at your trading expenses a lot of them are not that variable When you take cost of occupancy and rates and taxes and rents and all of those kind of things, a lot of that outflow, the only real variable you got there is kind of sort of your wages and stuff that you know you can flex. when you take cost of occupancy and rates and taxes and rents and all of those kind of things a lot of that outflow the only real variable you got there is kind of sort of your wages and stuff that you know you can flex Yeah, it's absolutely the nub of where we are. yeah it's absolutely the nub of where we are Top line is everything because if you lose the momentum on the top line, there's no way that you can cut your expenses as a rate to offset loss of momentum at the top line level. top line is everything because if you lose the momentum on the top line there's no way that you can cut your expenses as a rate to offset loss of momentum at the top line level That's why one of the constraints currently in this marketplace is top line sales. I don't sit here, we don't sit here in Kenilworth and have this set of circumstances, the macroeconomy looking at us. Our colleagues down over the hill over there, or nearer to that side of the mountain on the other side over there, they have a different set of dynamics. They're operating in the exact same market that we're operating in. These things are common to all. The pressures we feel, they feel as well. You see, our expenses, if we can get our top line growing at the rate that can continue to show these trends, your expenses of your wage expense and your fixed cost expense all comes down as a proportion of it. That's why one of the constraints currently in this marketplace is top line sales. that's why one of the constraints currently in this marketplace is top line sales I don't sit here, we don't sit here in Kenilworth and have this set of circumstances, the macroeconomy looking at us. i don't sit here we don't sit here in kenilworth and have this set of circumstances the macroeconomy looking at us Our colleagues down over the hill over there, or nearer to that side of the mountain on the other side over there, they have a different set of dynamics. our colleagues down over the hill over there or nearer to that side of the mountain on the other side over there they have a different set of dynamics They're operating in the exact same market that we're operating in. they're operating in the exact same market that we're operating in These things are common to all. these things are common to all The pressures we feel, they feel as well. the pressures we feel they feel as well You see, our expenses, if we can get our top line growing at the rate that can continue to show these trends, your expenses of your wage expense and your fixed cost expense all comes down as a proportion of it. you see our expenses if we can get our top line growing at the rate that can continue to show these trends your expenses of your wage expense and your fixed cost expense all comes down as a proportion of it The work that we are doing currently to do the OpEx reset, to have a look at the store labor reset and all of that stuff that we're doing, this is all work that's happening quietly behind the scenes. It's ongoing. It's ongoing. The work that we are doing currently to do the OpEx reset, to have a look at the store labor reset and all of that stuff that we're doing, this is all work that's happening quietly behind the scenes. the work that we are doing currently to do the opex reset to have a look at the store labor reset and all of that stuff that we're doing this is all work that's happening quietly behind the scenes It's ongoing. it's ongoing It's ongoing. it's ongoing Sure. Good luck. Sure. sure Good luck. good luck Thank you. We just need your support in the store shopping with us, and then it'll help us get there. Thank you. thank you We just need your support in the store shopping with us, and then it'll help us get there. we just need your support in the store shopping with us and then it'll help us get there

Speaker 1: Sorry, Sean, one more question. Is the group break even including Boxer for the full year? Sorry, Sean, one more question. sorry sean one more question Is the group break even including Boxer for the full year? is the group break even including boxer for the full year

Speaker 4: It's specifically focused on Pick n Pay. It's specifically focused on Pick n Pay. it's specifically focused on pick n pay

Speaker 1: Okay. The last question, can you clarify if the full year guidance for F 2026 is on the trading profit pre-leases level? Okay. okay The last question, can you clarify if the full year guidance for F 2026 is on the trading profit pre-leases level? the last question can you clarify if the full year guidance for f 2026 is on the trading profit pre-leases level

Speaker 4: It is on the trading profit pre-leases level. It is on the trading profit pre-leases level. it is on the trading profit pre-leases level

Speaker 1: And that's it from [Joburg]. And that's it from [Joburg]. and that's it from [joburg]

Speaker 6: Okay. Yes, sir. Okay. okay Yes, sir. yes sir One of the important slides you presented are the social welfare benefits you bring to the country. Why isn't this more promoted? I mean, with all the problems you're resolving, don't you think we should be more aware of the benefits you're bringing to the society? One of the important slides you presented are the social welfare benefits you bring to the country. one of the important slides you presented are the social welfare benefits you bring to the country Why isn't this more promoted? why isn't this more promoted I mean, with all the problems you're resolving, don't you think we should be more aware of the benefits you're bringing to the society? i mean with all the problems you're resolving don't you think we should be more aware of the benefits you're bringing to the society Good question from one of our faithful long-term shareholders, private shareholders. We appreciate it, and I appreciate that question. You know, there's a famous saying in life that the hand of the receiver should never know the hand of the giver. It's something that we also believe in in the company. I think just to continually quietly invest in community and do what you do creates far more long-term loyalty and sincerity with the communities that we deal with because I know that we're there for them. It's always been a philosophy of ours and a belief of ours that we just quietly get on with it, and we just change lives in communities. In fact, we've got Suzanne sitting here. She's been at the forefront of a lot of this too, and a lot of that instilling that culture into the company. Good question from one of our faithful long-term shareholders, private shareholders. good question from one of our faithful long-term shareholders private shareholders We appreciate it, and I appreciate that question. we appreciate it and i appreciate that question You know, there's a famous saying in life that the hand of the receiver should never know the hand of the giver. you know there's a famous saying in life that the hand of the receiver should never know the hand of the giver It's something that we also believe in in the company. it's something that we also believe in in the company I think just to continually quietly invest in community and do what you do creates far more long-term loyalty and sincerity with the communities that we deal with because I know that we're there for them. i think just to continually quietly invest in community and do what you do creates far more long-term loyalty and sincerity with the communities that we deal with because i know that we're there for them It's always been a philosophy of ours and a belief of ours that we just quietly get on with it, and we just change lives in communities. it's always been a philosophy of ours and a belief of ours that we just quietly get on with it and we just change lives in communities In fact, we've got Suzanne sitting here. in fact we've got suzanne sitting here She's been at the forefront of a lot of this too, and a lot of that instilling that culture into the company. she's been at the forefront of a lot of this too and a lot of that instilling that culture into the company Doing good is good business, as our Chairman taught us, Chairman and Founder. Thank you very much indeed. Wish you all the best. Have a great week. Mine's going to be spectacular. Doing good is good business, as our Chairman taught us, Chairman and Founder. doing good is good business as our chairman taught us chairman and founder Thank you very much indeed. thank you very much indeed Wish you all the best. wish you all the best Have a great week. have a great week Mine's going to be spectacular. mine's going to be spectacular

Speaker 4: Thank you. Thank you. thank you