"In SA, the tough trading environment is likely to persist for the balance of this year, particularly with the political uncertainty undermining consumer and business confidence," CEO Graham O'Connor said.
Spar reported on Wednesday morning that revenue for the six months to end-March grew 14% to R48.4bn and attributable profit was up 10% to R908m.
Southern Africa contributed 68% of the group's revenue, followed by 20% from Ireland and 12% from Switzerland. Measured by pretax profit, Southern Africa contributed 88%, Ireland 15% and Switzerland a R26.6m loss.
"An ongoing focus on improving the retail performance of the recently acquired Spar Switzerland culminated in the appointment of a new CEO from Spar SA to drive the process," the group said in the results statement.
"The positive performance of the core distribution activities was dampened by disappointing results from the corporate owned stores.
"The group is aggressively driving interventions to enhance this retail performance. Spar Switzerland's total store network remained constant at 301 stores."
Although its Irish business grew sales by 1.6% measured in euros, in rand its contribution fell 13% to R9.6bn from R11.1bn, due to the rand's appreciation over the six months to end-March.
In Southern Africa, Spar added 72 new stores to end the reporting period at 2,069 stores. It also upgraded 89 stores during the six months.
"The turnover of Spar Southern Africa increased 4.9% to R32.5bn reflecting a weak retail market," O'Connor said.
"Continued growth in liquor sales, albeit at a slower pace than in prior periods, positively supported this performance, whereas depressed building material sales had a converse effect.
"Combined food and liquor wholesale turnover growth was recorded at 5.4% compared to internally calculated food inflation of 8.2%," he said.
Its Tops liquor stores increased sales by 9.1% to R5.2bn - a slowdown from the matching period's 17.2% growth, which Spar blamed on "competitors' aggressive entry into the liquor market". Its Tops network increased by 14 stores on a net basis to 705 stores and 13 stores were revamped.
Hardware chain Build It's sales growth slowed to 3.6% from 16.6% in the matching period. As at 31 March, Build It's store network totalled 354 stores, having opened a net six stores in the period.
Source: BDpro
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