R111m loss for Takealot

By Jan Vermeulen for MyBroadband

Takealot grew its gross merchandise value by 34% and revenue by 27%, Naspers reported in its annual results for the period 1 April 2021 – 31 March 2022.

Naspers noted that these percentages represent growth in local currency, excluding mergers and acquisitions.

Takealot’s revenue grew from $606 million (R9.6 billion) last year to $827 million (R13 billion).

It recorded the same trading loss as last year, $7 million (R111 million), or a 1% trading loss margin.

According to Naspers, the Takealot group remained near breakeven.

It also reported that Takealot has over 6,000 employees and 13,428 drivers working for the company.

“The Takealot Group, comprising Takealot.com, Mr D Food, and Superbalist performed well, despite the rebound in offline retail sales,” Naspers stated.

“Takealot.com, our leading ecommerce platform, successfully navigated the challenges of global supply chain constraints across multiple categories, especially consumer electronics,” reported Naspers.

“Takealot.com’s third-party marketplace sales continue to outpace first-party sales and accounted for 52% of total GMV.”

Takealot.com delivered revenue growth of 29% for the year. This drops to 20% when measuring in local currency, excluding mergers and acquisitions.

“Despite increased competitive pressure from bricks-and-mortar retailers, Superbalist, one of South Africa’s leading online fashion destinations, delivered strong revenue growth of 43% and improved its trading loss margin by almost 2 percentage points to 7% during the year,” said Naspers.

“Mr D benefited from increasing awareness of online food delivery, a slower recovery of the restaurant market, and shifting consumer demand online.”

Mr D Food saw a 51% increase in order volumes in the past year and grew revenue by 62%, Naspers stated.

These order volumes are expected to increase next year as Pick n Pay has partnered with Takealot to add its food, groceries, and liquor products to the Mr D app.

Pick n Pay announced in May that Takealot would include a dedicated section for its products in the Mr D app.

This will be available nationwide by the company’s financial year-end.

Naspers highlighted one other South African business — Media24.

It reported that Media24 delivered strong results, underpinned by profitability in every part of its business.

“A recovery over the full year saw revenue increasing by 12% to US$257 million (R4.1 billion) and a trading profit of US$17 million (R269 million),” Naspers said.

“This turnaround performance against the prior year’s losses was bolstered mainly by continued strong growth in digital subscribers 27% and advertising 16%, a robust recovery in print media, and excellent school textbook orders and trade sales.”

Naspers said the turnaround was supported by the leaner cost base established in FY21.

Source: EWN

Eskom announced on Tuesday afternoon (28 June) that load shedding would be escalated to Stage 6 from 4 pm until 10 pm on both Tuesday and Wednesday.

The beleagured power utility says it’s under increased pressure because of an illegal strike at some of its plants.

This had already resulted in an escalation to Stage 4 power cuts from last week.

Public Enterprises Minister Pravin Gordhan has now said an agreement’s been reached with unions to bring the strike at Eskom to an end.
Stage 6 load shedding equates to at least six hours without power per day, possibly in two-hour cycles.

The first and only time South Africa last endured this level of power cuts was in December 2019.

Chris Yelland, MD of EE Business Intelligence, emphasises that the current load shedding pre-dates the industrial action at Eskom.

“Before the industrial action we were already having Stage 2 to Stage 4 load shedding. The industrial action, according to Eskom, has put a further 4,000MW at risk which translates into four stages of load shedding. If we were having Stage 2-4 load shedding before the industrial action, this extra four stages would take it to Stage 6 to Stage 8 and we are in the midst of Stage 6 right now – I’m having four hours at a stretch… This 24-hour period is going to be eight hours [in total] of power off for me.”

Yelland notes that Eskom itself made it clear during today’s media briefing that there is a risk of Stage 8.

The return to wage negotiations announced earlier is certainly an encouraging sign, he says.

While the effect on the economy is dire, much depends on how long Stage 6 load shedding lasts says Mhlanga, and even the lower stages.

“Just to give you a sense of what this might mean, if the Stage 6 lasts for a cumulative 24 hours… the different power shortages that would accumulate… it means the economy is likely to lose about R12 billion,” says Isaah Mhlanga, chief economist at Alexander Forbes.

“I’m not saying this going to last for a full month… but just to quantify the magnitude, if were to have Stage 6 for a cumulative month that’s R367 billion or 15 600 jobs at risk.”

Looking at the situation from a foreign investor perspective it is difficult to see such an investor looking to establish a large manufacturing entity here, coming to South Africa relative to other countries he says.

“A lot of jobs are now part-time [latest stats]… which means corporates are taking a dim view of the future economic prospects of the country… Those workers are quite vulnerable… All it means for consumers is, whatever cash they have, hold onto it,” says Mhlanga.

No end in sight for consumer pain

By Ashley Lechman for IOL

There seems to be no reprieve for South African wallets as another hefty fuel increase is predicted for next week, as well as economists anticipating further interest rate hikes.

The Organisation Undoing Tax Abuse (Outa) said on Monday it predicts that motorists could be paying R1.75 more for fuel from July 6.

Citizens could soon be sounding the alarm bells, as the South African Reserve Bank, will also be looking to curb the spiking inflation in the country by raising interest rates once again at its next Monetary Policy Committee meeting.

The Reserve Bank has been on a trend of raising the interest rate since the start of the year, as the country recovers from the Covid-19 pandemic.

Adding to the pain felt to the wallets of many, the continuing crisis in Ukraine affects wheat and cooking oil prices, driving up the price of many food items.

In an effort to provide some form of relief, Outa has urged the government to extend the R1.50 general fuel levy.

“We really do need to see longer-term solutions, but for now, the short-term solution is the only space government can provide some reprieve, and that is in the fuel levy,” Outa CEO Wayne Duvenage said.

“Outa believes it would be prudent for the minister of finance to consider extending the fuel levy reprieve of R1.50 per litre.”

Minister of Finance Enoch Godongwana extended the general fuel levy relief on May 31 this year, saying it would be R1.50 until July 6, then drop to R0.75 until August 2.

“Petrol is extremely expensive now. It is impacting on inflation. It is impacting on commuter pricing. So instead of dropping it to R0.75 for another month, keep that R1.50 reprieve in place,” Duvenage added.


Source: Supermarket & Retailer

Gcwalisa is a local retail outlet that uses refillable dispensers to allow customers to buy a selection of basic food items and household products through a weigh-and-pay model, for as little as R5.

Similar to how we used to buy atchar for five rand or less at the local tuck shop, CEO and founder Miles Kubheka remembered experiences where his mother would send him to buy sugar in a mug – and he has brought that the people on a more nutritious scale.

“I knew that it’s not a foreign concept. People would warm up to it because they have been and still are doing it,” he said.

“This was just to streamline that and make sure that now they can benefit or get the same price as if they were buying bulk but for smaller items.”

The food outlet, located in the township of Alexandra, aims to provide individuals who are either food insecure or at risk of being food insecure to buy non-perishable, nutritional food products with any amount of money at their disposal.

The products in his store include 250g of rice, sugar, and beans for just R5 each. Customers can also buy 250g of Samp. maize meal, and maize rice for as little as R3, and 250g of flour for R4.

Other items include a single tea bag for 5 cents, and salt and soups for the winter season.

How it started

The initiative started in 2020 at the height of the lockdown. Through a kitchen accelerator, Kubheka and those he worked with gave people in need over 300 meals to combat hunger.

“At that time I partnered with an organisation called SA Harvest. We helped rescue excess food from retailers and farmers, but we quickly realised that that’s not a sustainable model because there are always more people hungry the next day,” Kubheka said.

To move away from what he called the “charity case system that forces people to always resort to begging”, the entrepreneur thought it would be a good idea to rather sell nutritious food staples to the community at affordable prices.

He has now partnered with brands such as Unilever and big retailers that sell the food staples to him in bulk at discounted prices.

“One of the things that is very important is that consumers are very brand conscious. If someone doesn’t have money, they don’t usually just buy something because its cheap.

“They want the authentic stuff, and the reason for that is that when you are poorly paid, you don’t have the luxury to get the product wrong. It has to do what it says. It must rise three times if it’s Tastic [rice],” he said.

How it works

There are three ways to do it, according to Kubheka. Customers can come with their own lunch box and buy the non-perishable staples that they need through the weigh-and-pay system.

“As a convenience, if you remember that you need to buy something, we can also weigh and sell it to you in a biodegradable paper bag. This is to feed people while being good to the environment,” he said.

Kubheka has also introduced reusable glass containers in his store. This is to allow repeat customers to use the same container, while also solving the problem of littering the environment.

“There is a huge demand for cooking oil, we sell that in glass jars. You can return the jar and we refill it for you.

“That’s actually been a hit more than we thought it would be. People love those glass jars,” he said.

In addition to employing community members to run the store, Kubheka said the plan is to target other parts of Alexandra and eventually launch a store in Diepsloot. This will feed more people and also create jobs.


How to get your Kulula refund

By Maya Fisher-French for News24

After announcing the suspension of flights last week due to funding issues, Comair this week announced that it had applied for liquidation. The application will be heard in court on Tuesday.

According to a press statement released by Comair, the company’s employees and customers who had bookings or were owed refunds will now become creditors of the company.

Customers will be concurrent creditors, which means customers due refunds will only receive payment if there are funds left after paying costs and preferential creditors. However, there are various ways that customers can obtain a refund depending on the airline and depending on how they booked their flights.

For those customers who had booked local British Airways (operated by Comair) flights, the British Airways Booking with Confidence Policy will apply. This means that tickets will either be refunded or rebooked.

If you have a standalone booking with British Airways (operated by Comair) to fly within southern Africa, take note of the following:

If you are due to travel up to and including June 14, you can obtain a refund via Manage my Booking, or call British Airways to discuss rebooking options.

If you are due to travel from June 15 onwards, you can obtain a refund via Manage my Booking.

If you have a booking with Comair and you booked through a travel agent, you will need to contact them directly regarding refunds.
Kulula customers

Kulula customers who booked during the “winter sale” special on May 30 will be fully refunded. Other Kulula customers will become concurrent creditors.

Customers need to email MNContactCentre@comair.co.za for information.

Chargeback – a refund from your bank

Kulula customers who booked using their Visa, American Express or Mastercard could qualify for a refund under the chargeback rules. When you use your card for transactions, you qualify for chargeback rights if merchants don’t deliver goods and services.

A chargeback prevents customers from suffering financial loss and engaging in lengthy disputes with merchants. The bank takes care of this within a clearly defined process.

According to Standard Bank, a chargeback would automatically apply once the airline goes into liquidation. This means that if the liquidation order is granted on Tuesday, all ticket holders who booked using a Mastercard, American Express or Visa card will be able to apply for a chargeback from their bank.

Nedbank has confirmed that “impacted clients who were not able to fly and purchased tickets using a payment card, branded with a Visa, Mastercard or an American Express logo, may contact their bank to log a dispute. Clients have the right to an immediate chargeback following the granting of the liquidation order”.

Nedbank customers can call 010 217 3001 or email CPOCardDisputes@nedbank.co.za for information.

Absa customers who booked Comair tickets via their cards can email disputes@absa.co.za to assist with the chargeback process.

“As with all chargeback requests, each matter is evaluated in line with the Visa and Mastercard chargeback rules,” said an Absa spokesperson.

FNB confirms that customers who purchased British Airways and Kulula tickets using the FNB and RMB Private Bank apps, eBucks or the eBucks Travel desk will be assisted through a dedicated refund process.

“Our customers who purchased their tickets directly from the affected airlines or a third-party travel agent can lodge a dispute through the SecureChat feature on the FNB and RMB Private Bank apps,” said an FNB spokesperson.

To avoid any delays in processing a refund, we encourage our customers to immediately upload a copy of their flight booking confirmation. Customers can chat to a SecureChat agent for further assistance.

The spokesperson added that customers who paid for flight tickets using third-party instant EFT services are advised to lodge a dispute directly with the airlines, as instant EFT payments cannot be reversed via the bank.

Discovery Bank announced that it would immediately refund Vitality clients affected by the Comair shutdown.

“Any Vitality member who is a Discovery bank client and booked a discounted flight departing from June 1 2022 onwards that has been cancelled due to this issue, Discovery bank will automatically refund the amount spent on that flight into the Vitality member’s Discovery bank account by close of business on June 10. This refund process is automatic, so no action is required from members.”

Affected Vitality members who are not Discovery bank clients can open a Discovery bank account by downloading the Discovery bank app before June 30 to facilitate the refund. Alternatively, they can process the refund through their own bank.

Standard Bank customers who want an update on refunds from Comair or would like to query their refunds can call 0861 20 1000 (main market), 0860 001 321 (prestige) and 0860 123 101 (private banking).

What happened?

The airline operator had been in business rescue since May 5 2020 due to the suspension of all travel during the Covid-19 lockdown.

According to a press statement, after entering business rescue, Comair was able to start flying again when the Comair Rescue Consortium (CRC) invested R500 million for a 99% share of the equity in the company at the time.

According to the company, further Covid-related air travel restrictions combined with the significantly higher fuel prices experienced in the past five months had a material negative impact on the business.

The CRC was only able to finance the impact of these events up to a certain point.

In March, Comair sold the Slow Lounge business to FNB in an attempt to raise more funds.

On June 9, the business rescue practitioners lodged a court application to convert the business rescue proceedings into liquidation proceedings.

In a press statement, one of the business rescue practitioners, Richard Ferguson, says that with its two airline brands – British Airways (operated by Comair) and Kulula – market share, modern aircraft fleet, experienced employees, and sales and distributions channels, Comair was an inherently viable business.

“We did our utmost to secure the funding, but when we were unable to do so, we had no option but to lodge the application. It is an extremely sad day for the company, its employees, its customers and South African aviation.”

By Joon Chong for IOL

The South African Revenue Service has announced the deadline dates for filing income tax returns for the 2022 year of assessment as well as the details of those exempt from filing returns.

On 3 June 2022, SARS will publish a notice in the Government Gazette specifying the taxpayers that do not need to file income tax returns for the 2022 year of assessment, and the deadlines for taxpayers that have to file an income tax return.

Taxpayers who are exempt from filing are those who receive total income of less than R500 000 for the year from only one source and receive no other allowances or benefits, and from whom PAYE has been deducted according to the prescribed tax deduction tables. Individuals who only receive (i) interest below the interest exemption thresholds; (ii) amounts from tax-free savings accounts; or (iii) dividends and are non-residents throughout the year, are also not required to file returns.

Please note the following filing deadlines for companies, within 12 months of their financial year-ends and for all other taxpayers (including natural persons, trusts, institutions, boards and other bodies):

On or before 24 October 2022 if the return is submitted manually or with the assistance of a SARS official at one of SARS’s offices, or for a non-provisional taxpayer who is filing via SARS’s eFiling platform;
On or before 23 January 2023 for provisional taxpayers using eFiling;

Further information is contained on the SARS website.

Taxpayers should note the shortened time frames to submit their returns and prepare for these submissions sooner rather than later.

SARS will continue to auto-assess individuals in the auto-assessment population based on third-party data received from employers, financial institutions, medical schemes, and retirement fund administrators. These taxpayers will receive an SMS from SARS that they have a tax return pre-populated by SARS on eFiling or the SARS MobiApp.

These taxpayers will need to “Accept” or “Edit” and submit the auto-assessments by 24 October 2022 if they are individual non-provisional taxpayers. Notably, this due date for the 2022 filing season is a month earlier than the equivalent due date for the 2021 filing season (23 November 2021).

Individuals who are auto-assessed but do not accept, edit or submit their auto-assessments will receive an estimated assessment from SARS which is not subject to objection and appeal. We expect that the same penalty rules for auto-assessments in the 2021 filing season should apply for the 2022 filing season. An individual who does not agree with the estimated assessment can file an accurate ITR12 tax return within 40 business days of the date of the estimated assessment. This return will be late and subject to normal late submission admin penalties and interest.

The late submission admin penalty is imposed monthly up to 35 months (if SARS has the address of the taxpayer). The monthly penalty ranges from R250 to R16 000 a month, depending on the assessed loss or taxable income of the taxpayer for the year prior to the year being assessed.


By Jan Vermeulen for MyBroadband

Mr Price released its annual financial results and reported that its telecoms segment exceeded a billion rand for the first time.

The group’s revenue increased 23% to R28.1 billion, of which Mr Price Cellular and Powercell accounted for R1.2 billion, having grown 34.4% for the 52 weeks ended 2 April 2022.

“Mr Price Cellular, launched in 2017, has reported exponential growth since inception and is now available in 374 stores with promising growth opportunities, most notably the rollout of standalone stores,” the company reported.

“Cellular handsets and accessories gained 130 basis points of market share according to Growth for Knowledge (1.3 percentage points) — 190bps including Powercell in Power Fashion,” it stated.

Mr Price said this is a significant gain considering the disruption caused by global supply chain challenges and the civil unrest in KwaZulu-Natal and Gauteng during July 2021.

According to the Retailers’ Liaison Committee, the group reported a 1.4% percentage point gain in market share.

The retailer also saw significant gains online, increasing market share by 70 basis points to 13.3%.

Online sales grew 48.2% and contributed 2.9% of retail sales.

Citing Similar Web stats for April 2021 – March 2022, Mr Price said its online growth was second-highest behind Takealot among omnichannel and pure-play retailers.

“Its nearly six million loyal social media followers grew by double-digits,” Mr Price stated.

“The Mr Price mobile app remains the highest-ranked South African fashion shopping app on the Google Play store, with customer usage up 27.3% according to Similar Web.”

Source: News24

South Africa’s economy was stronger than expected in the first quarter of 2022, with real gross domestic product (GDP) growing by 1.9% from the previous quarter.

The size of the economy is now at pre-pandemic levels, with real GDP slightly higher than what it was before the Covid-19 pandemic, Statistics SA said.

Last year, the South African economy grew by 4.9% as it started to recover from a 6.4% slump in 2020 due to pandemic-related lockdowns.

The median expectation among economists polled in a Bloomberg survey was for growth of 1.2% in the first quarter. The economy grew by a revised 1.4% in the fourth quarter of 2021.

The manufacturing sector saw strong growth of almost 5% in the first quarter, driven by a rise in the production of petroleum and chemicals, food and beverages, and metals and machinery.

But construction and mining activity declined compared to the previous quarter.

Household consumption increased by 1.4% in the first quarter, with a sharp 6.5% increase in spending on restaurants and hotels.

Second-quarter GDP is expected to be hit by the impact of flooding in KwaZulu-Natal and increased load shedding, as well as the knock-on effects of the Ukraine invasion, particularly higher food and fuel prices. In addition, higher interest rates are also expected to weigh on growth.

The SA Reserve Bank expects growth of 1.7% this year.

Big changes coming to Spar stores

Source: Supermarket & Retailer

Retail group Spar has warned of increased inflationary pressures in the coming months, with consumers expected to remain under financial strain as the cost of living increases.

In its interim financial results published on Wednesday 8 June, the group said it plans to address this by increasing its promotional calendar for the period ahead to continue to attract cash-strapped consumers.

The group is also planning to revamp its fresh food offering – including fresh produce, butchery, bakery and home meal replacement.

Liquor sales are also expected to rebound in the absence of further pandemic-related liquor trading restrictions, the group said.

Spar also plans to fully stake its claim in the online shopping space in the coming months as it ramps up the rollout of its new online shopping platform, SPAR2U. The e-commerce platform will deliver both groceries and liquor, with the service already being piloted in some stores.

“There is great enthusiasm from our independent retailers to implement SPAR’s new online shopping platform, SPAR2U. Our online platform is receiving positive reviews and a large number of stores are preparing to launch online within their communities in the coming months,” the group said.

SPAR2U launches in a crowded online same-day delivery space – with Pick n Pay, Woolworths and Checkers all offering same-day delivery services. Checkers’ Sixty60 one-hour on-demand grocery delivery service launched in late 2019, just prior to the onset of the Covid-19 pandemic in early 2020.

Pick n pay acquired the Bottles app in October 2020, rebranding it to asap! in 2021. Woolworths launched its same-day service Woolies Dash in December 2020.

Financial results

Spar South Africa reported solid growth, with wholesale turnover increasing by 7.7% to R43.8 billion. Groupe operating profit increased to R1.83 billion (+7.1%), while headline earnings per share increased to 642.6 cents (+3.5%).

The core SPAR wholesale grocery business reported a meaningful recovery in sales growth of 4.6%, assisted by increased marketing initiatives at retail, and unrestricted liquor trading, which drove increased footfall to Spar stores.

Core business trading continued to be impacted by the stores which were closed due to the civil unrest in July 2021. At the end of the period, 13 Spar format stores and nine Tops at Spar stores remained closed.

Following the lifting of the Covid-19 nationwide liquor trading bans in September 2021, TOPS at SPAR made a strong recovery, increasing turnover by 41.6% for the period. On a combined basis, wholesale grocery and liquor turnover increased by 8.5% for the period.


By Colleen Goko and Prinesha Naidoo for Bloomberg

A change in the way South Africa’s central bank implements monetary policy may lead to greater volatility in the rand.

The transition will start Wednesday night and will see the central bank shifting to a surplus system from its current deficit set-up, meaning commercial banks will be allowed to hold and earn interest on excess reserves. The South African Reserve Bank will also introduce measures to prevent banks from hoarding liquidity, and thus help maintain an interbank money market, similar to the “tiered floor” framework used by the Reserve Bank of New Zealand and the Norges Bank.

While the change won’t affect the central bank’s inflation target or interest-rate decisions, it may make it easier to speculate in the rand, resulting in wider price swings during times of stress. Elevated ZAR-USD basis-swap rates since the pandemic have made it expensive to short the South African currency.

“The currency basis will contract, making it cheaper to short the rand,” said Michelle Wohlberg, a Johannesburg-based fixed-income analyst at Rand Merchant Bank. “This could result in volatility in risk-off bouts.”

The rand has been less volatile this year than a host of peers – including the lira, zloty and real – even as risk assets came under pressure amid rising global inflation and policy tightening, concerns of a slowdown in China, and Russia’s war with Ukraine. The currency’s historic volatility versus the dollar has risen 63 basis points to 14.66%, the seventh highest of the 23 developing-currencies monitored by Bloomberg.

In a published paper addressing concerns around volatility, the Reserve Bank said managing the risk would require “caution and vigilance,” both during the transition to the new framework and in moments of acute market pressure. South Africa is the first emerging-market economy to adopt the tiered-floor framework.

“The risk is assessed as modest and does not represent a major objection to the concept of the new monetary policy implementation framework,” it said. “That said, the exchange rate may prove to be one area where South Africa’s status as an emerging market yields a different experience to those of advanced economies which have used floor-style systems.”

The central bank has “a long track record of tolerating FX volatility” and inflation expectations are anchored, and therefore not highly sensitive to exchange rate fluctuations, the paper said.

Follow us on social media: 


View our magazine archives: 


My Office News Ⓒ 2017 - Designed by A Collective