Franklins beginning to make an impact, profits start to flow
Australian supermarket chain Franklins has posted its maiden first-half profit since being acquired by prominent South African retailer Pick ‘n Pay back in 2001. Since the takeover the company has struggled to make inroads in the Australian grocery sector but appears to be finding its feet after posting its first full-year profit earlier this year.
Franklins now operates 83 supermarkets throughout the state of New South Wales, seven of which are franchise stores. Three new corporate stores are anticipated to be opened in the remainder of the financial year.
Pick ‘n Pay reported that Franklins “had a very good trading period realising an operating profit before interest and capital profits of R1.5 million (A$210,000) versus a loss for the same period last year of R40.3 million (A$5.7m)”.
“We are particularly delighted with our performance in Australia and the investment we have made in this business is proving fruitful,” CEO of Pick ‘n Pay, Nick Badminton, proclaimed. “This significant turnaround over last year is due to increased operating efficiencies, high double digit turnover growth from refurbished stores and the success of the customer loyalty program.”
“We’re confident we’ll make a profit for the full year… I think the worst is behind us and we’re happy that we can get continuity in profits now,” Franklins MD Aubrey Zelinsky advised, according to The Australian. “Unless the bottom really fell out tomorrow, we should still get a profit for the full year.”
Mr Zelinsky said the retailer had noticed a change in shopping habits of consumers but did not expect this to dampen the prospect of a full-year profit.