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Chairman's statementI took over as Chairman of the Company with effect from 1 March 2010, on the retirement of Raymond Ackerman after 43 years at the helm of Pick n Pay. With Wendy at his side, he built this business from four small stores in Cape Town in 1967 to 794 stores (corporate and franchise) at the end of February 2010. If you had invested in a R1.10 share in 1968 it would be worth R5 800 today. By any commercial standard, this has been a remarkable return with a compound annual growth rate of nearly 25%. Over the last 20 years the Stores and Pikwik shares have shown compound annual growth rates of over 14%. It is a difficult task for anyone to step into Raymond Ackerman’s shoes; his legacy has been profound and ubiquitous. Almost single-handedly, he transformed the face of retailing in South Africa, pioneering the hypermarket concept and advancing genuine economic empowerment with the introduction of black ownership through franchising, amongst many other innovations and industry-altering initiatives. The Group today is unwavering in his commitment to the principle of consumer sovereignty and his mantra that “the customer is queen” is a household truism. The concept of sustainability is a core value which was introduced long before it became a universal practice. The belief that “doing good is good business” is not only a philanthropic virtue, but an act of enlightened business self-interest. Underscoring these convictions is the firm insistence that business efficiency is at the very core of Pick n Pay’s success.
“Being family-controlled has ensured that the values introduced in 1967 have carried through over 43 years. Importantly, this will not change”
The global economy is slowly recovering and with the recent interest rate cuts, we foresee a pickup in the local economy. This should translate into our sector with a growth anticipated from the third quarter onwards. According to the SA Chamber of Commerce and Industry’s Business Confidence Index published for March 2010, confidence in that month showed its first year-on-year increase since September 2007. This was no doubt stimulated by the approach of the 2010 FIFA World Cup and the continuing resilience of the South African financial system. The economy has seen a surge in inward investment which will manifest itself in an improved GDP growth rate. This growth prospect augurs well for the future of the retail sector. Doyen of supermarket retailing in South Africa, Raymond Ackerman, has stood down as
Chairman just short of his 80th birthday. But family control of the Group will remain. Reflecting on his career, Ackerman said: “The last 43 years have been incredible. A fantastic adventure and wonderfully rewarding.” Although Government’s responsible and prudent economic policy has ensured the stability of the national economy, I must express my concern about statements made by certain influential political individuals. If not refuted by senior policy-makers these statements could create negative foreign and domestic perceptions and impact negatively on future economic growth. South Africa is going through a period of considerable political and economic excitement and the corporate world will be watching with interest the unfolding debates which are currently afoot in the governing alliance. As we enter a new financial year, we have a number of key priorities, which Nick outlines in his CEO report. We are confident that we will see benefits start to flow next year from the strategy, particularly from improved business efficiency and from a continued focus on consumerism, community involvement and sustainability. During the next year we will perform a full strategic review of our Franklins operation in Australia.
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