Mr Price has delivered a record financial performance at a time when retailers are facing a complex mix of cautious consumer spending, global uncertainty and rising operating costs. The South African retail group reported operating profit exceeding R6 billion for the first time in its history during the 52 weeks ended 28 March 2026, demonstrating the strength of its value-focused business model even as it absorbed costs linked to its high-profile acquisition of European retailer NKD.
The results mark an important moment for the Durban-based retailer. While much of the market’s attention has been focused on the R9.6 billion NKD acquisition, the latest figures highlight that Mr Price’s core operations continue to generate consistent growth across apparel, homeware, telecoms and financial services.
Revenue and earnings continue moving higher
Total revenue increased by 4.2% to R42.7 billion, while operating profit grew 4.3% to surpass the R6 billion milestone. The company said once-off costs associated with the NKD transaction impacted reported earnings, prompting management to provide normalized performance metrics that better reflect underlying trading conditions.
On that basis, diluted headline earnings per share increased 8%, while gross profit margin expanded by 70 basis points to 41.2%. Achieving margin growth in a retail environment characterized by aggressive promotions and discounting was one of the standout aspects of the results.
Investors responded positively to the performance. Mr Price shares surged nearly 15% following the announcement as the market focused on the retailer’s ability to grow profits despite concerns surrounding the European acquisition.
Apparel, homeware and telecoms divisions drive growth
The apparel segment remained the group’s largest contributor, with retail sales increasing 4.2% to R32.8 billion. The division outperformed the broader South African clothing retail market, which recorded growth of 3.4% over the same period.
Comparable retail sales increased 1.1%, reflecting steady demand despite pressure on discretionary spending. Management noted that the second half of the financial year was measured against a particularly strong prior-year comparison, making growth more difficult to achieve.
The homeware division delivered retail sales growth of 3.8% to R6.9 billion. Sheet Street continued to benefit from its space optimization strategy and improved profitability, while Yuppiechef recorded double-digit sales growth and outperformed its market segment.
Elsewhere, the telecoms division continued its impressive momentum, with revenue increasing 10.3% to R1.5 billion. Financial services revenue rose 3.2% to R947 million, providing another source of diversification for the retailer.
The focus on profitability rather than pure sales growth has become increasingly important for retailers worldwide. Recent results from Target highlighted a similar emphasis on margin expansion and operational efficiency, underscoring how major retailers are adapting to more selective consumer spending patterns.
NKD acquisition brings opportunity and scrutiny
Although the financial results were strong, the biggest strategic question facing Mr Price remains the integration of NKD. The acquisition gives the group access to more than 2,100 stores across Germany, Austria, Italy, Croatia, Slovenia, the Czech Republic and Poland, significantly expanding its international footprint.
Investor reaction to the deal was initially negative when it was announced in late 2025, with concerns focused on lower European retail margins, increased debt levels and the challenges of managing a large business in multiple international markets.
Management has maintained that the acquisition represents a long-term growth opportunity. According to the company, clear priorities have already been established alongside the NKD leadership team, with the objective of achieving the performance targets previously communicated to shareholders.
Looking ahead to FY2027
Mr Price believes signs of improvement are emerging within South African household finances, although the discretionary retail sector has not yet fully benefited from that recovery. The company also warned that geopolitical developments could create fresh challenges in the months ahead.
The escalation of tensions involving Iran earlier this year contributed to higher oil prices, rising shipping costs and renewed inflation concerns. These factors have the potential to affect both consumers and businesses if they persist for an extended period.
Despite those risks, Mr Price remains in expansion mode. The retailer plans to invest approximately R1.1 billion in South Africa during FY2027, including around 180 new stores, store upgrades, technology projects and supply-chain improvements.
In Europe, NKD is expected to invest approximately €24 million and open about 150 additional stores. Given the introduction of structural debt following the acquisition, management has indicated that balance-sheet management and capital allocation will remain key priorities.
The group also declared a final dividend of 592.8 cents per share, broadly maintaining its shareholder return strategy while continuing to fund growth initiatives.
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For now, the latest results suggest that Mr Price’s underlying business remains healthy and profitable. The retailer has successfully navigated a difficult consumer environment, expanded margins and delivered record operating profit. The next chapter will depend on whether NKD can generate the returns management expects and justify one of the largest acquisitions in the company’s history.
Source: Additional company information, financial reports and investor updates are available through the Mr Price Group Investor Relations portal.
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