Mr Price Group has announced plans to exit Nigeria, close stores and focus on its operation in South Africa. It has closed four of its five stores in Nigeria and expects to close the final one in August. Nigeria is the third country that Mr price group has recently exited, after Australia and Poland last year.
According to Reuters – Mr Price Group has become the latest South African retailer to retreat from African markets due to weak economic growth, difficulties with repatriating funds and local procurement.
Chief Executive Officer, Mr Blair said “The company has hit too many roadblocks in the West African country” while presenting its full-year results on Thursday, June 25, 2020, according to a report by Reuters.
” I’m not prepared to invest any further whether it’s investment in time or in money into a country that is volatile as it is.
Mr price expected to support 50 to 100 stores because of its estimated population of over 200 million before entry into the country. The Group said it is reviewing its franchise operations.
MRP didn’t declare a final dividend and has taken steps to conserve cash. The company took some cost-saving initiatives which are largely related to employment costs. This includes a 23 percent reduction in budgeted capital expenditure for the 2021 financial year, This approach identified R300m.
MRP closed down all stores in the month of April because of the lockdown. Retail sales went down to 89.1% off a base of R1.9bn in April 2019. After the lockdown , retail sales for the period 1 May 2020 – 20 June 2020 were up 12.0%.