Pick n Pay Exits Nigerian Market Amid Broader Restructuring and Heavy Losses
South Africa’s retail giant Pick n Pay has announced its decision to pull out of Nigeria, selling its 51% stake in a joint venture as part of a larger restructuring strategy to navigate persistent financial challenges outside its home base. The retailer, which entered the Nigerian market just four years ago in partnership with A.G. Leventis (Nigeria), operates two outlets, including one in Lagos’s high-end Victoria Island area. However, rising operating costs and an increasingly tough business climate have prompted the company to make a swift exit.
Pick n Pay’s latest half-year financial results reveal deepening losses, with a 1.1 billion rand ($62 million) loss before tax and capital items reported for the 26-week period ending August 25. This marks a substantial increase from last year’s 837.2 million rand loss, with the company attributing a 9.1% rise in trading losses to dwindling profit margins in its core supermarket operations and mounting borrowing costs.
CEO Sean Summers has been spearheading an ambitious turnaround plan and remains cautiously optimistic, projecting that trading losses in the main Pick n Pay division could be slashed by up to 50% by year-end. Alongside these efforts, the company has witnessed positive growth within its clothing and online sales sectors, and a robust 16% profit boost in its discount Boxer division, where sales rose by 12%. Encouraged by Boxer’s performance, Pick n Pay plans to list the discount arm on the Johannesburg Stock Exchange by year-end, with expectations of raising 8 billion rand ($452 million) — potentially the largest IPO on the continent this year.
For Nigeria, Pick n Pay’s exit marks another departure of a prominent multinational from Africa’s most populous nation, reflecting broader challenges faced by global companies in navigating the country’s complex market landscape.
