Pick n Pay, a leading South African retailer, confirmed on Monday that its discount grocery subsidiary, Boxer, is set to go public on the JSE and A2X before year-end. Expected to raise between R6 billion and R8 billion, this highly anticipated IPO forms a central part of Pick n Pay’s larger strategy to stabilise its finances and enhance shareholder returns. Boxer, one of South Africa’s top discount chains, will be restructured under the new name Boxer Retail Limited as a standalone subsidiary.
The IPO will include newly issued shares offered to selected investors, along with an additional overallotment option valued at up to R0.5 billion, boosting fundraising to the top end of expectations. With Boxer positioned as South Africa’s leading “soft discounter,” known for its focus on affordability and customer loyalty, Pick n Pay sees the listing as a crucial step in reinforcing Boxer’s reputation among South Africa’s retail giants.
“Boxer has cemented its position as South Africa’s leading soft discounter, consistently growing its sales volumes through a deep understanding of its customers and an unwavering commitment to reinvesting cost savings into lower prices,” Pick n Pay stated.
In the face of a challenging financial year, Pick n Pay is leaning on Boxer’s IPO to enhance liquidity, secure a stronger capital structure, and chart a path to recovery.
Financial Results Underscore the Need for Change
Pick n Pay’s recent financial report reveals the pressing need for transformative steps. In the 26-week period ending August 25, 2024, the group’s consolidated turnover increased by a mere 3.7% to R56.1 billion, while its loss before tax climbed by 19.6% to over R1 billion. Loss after tax widened by 44.8% to R827.4 million, and basic earnings per share dropped nearly 40%.
Boxer, however, remained a bright spot, posting a robust 16% increase in trading profit to R801.4 million and a 12% rise in sales. Pick n Pay credited Boxer’s success to effective cost management, streamlined product offerings, and an adept understanding of customer needs in South Africa’s lower-income market. Boxer’s IPO is expected to cement this momentum, with Pick n Pay retaining a controlling interest in the subsidiary.
Pick n Pay’s Strategic Shift to Drive Profitability
In early 2025, Pick n Pay underwent a major strategic transformation aimed at addressing structural weaknesses and boosting profitability. This included a rights offer that raised R4 billion in new capital, oversubscribed by 106%, as part of a two-step recapitalisation plan to ease balance sheet pressures and set the stage for Boxer’s IPO. CEO Sean Summers praised his management team’s role in driving the turnaround, noting their resilience in the face of economic headwinds.
Other areas of Pick n Pay’s business are showing signs of recovery as well. Pick n Pay Clothing recorded a 9.8% sales increase, and Pick n Pay Online grew by 60.6% year-on-year. This focus on enhancing profitability and efficiency within specific segments has been central to the company’s strategic goals.
Recovery Targets and Future Challenges
Summers, acknowledging the financial turbulence, remarked that results aligned with the company’s business plan and forecasted stronger performance in the second half of 2024, especially around Black Friday and the festive season. Key to these projections is Boxer’s continued profitability.
Despite challenges, Pick n Pay supermarkets posted a 3.1% increase in like-for-like sales in the first half of 2025, improving on a 0.5% decline in the prior half-year. The franchise division, however, continues to face challenges, which Pick n Pay is actively addressing. For now, its focus remains on solidifying profitability in the Boxer and Clothing divisions.
“Unlike 12 months ago, I can confidently say that the worst is behind us,” Summers stated, though he acknowledged ongoing obstacles on the path to sustained profitability.
Summers further hinted at an exciting announcement set for Wednesday, hinting at a new strategic partnership aimed at elevating customer experience and showcasing renewed confidence in Pick n Pay’s recovery journey.
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