Operational Profile

Masscash

Masscash Brands

Masscash consists of wholesale food and cosmetics business interests as well as retail outlets, all of which target the lower LSM groups. Our wholesale division consists of CBW, Jumbo Cash & Carry, and Shield as well as a number of independent wholesalers operating under their own brands while our retail division is being consolidated under the Cambridge banner.

CBW wholesales food, liquor, groceries and cosmetics in bulk to independent general dealers, government feeding schemes, franchise members, small traders and hawkers in peri-urban and rural areas within southern Africa. Jumbo sells mainly cosmetics, toiletries and hair-care products to individual customers and independent general dealers. Shield is a voluntary buying association that buys products in bulk on behalf of 605 members who own wholesale or retail food businesses in South Africa, Botswana, Namibia and Swaziland.

We also manage the brands of a number of our wholesale customers. At the lowest end of the market, we provide marketing support such as supplying signage and leaflets to spaza shop and shebeen owners through our Banner Group initiative. Masscash owns the rights to these brands and logos.

We offer wholesale customers with more formal operations the ability to trade under national retail brands such as Saverite, Multisave, Powersave and Liquorland. Our marketing team offers wide-ranging support to these supermarkets and bottle stores, assisting owners with marketing initiatives such as designing of leaflets, signage and implementing national television and radio advertising campaigns.

On the retail side, we are consolidating our retail outlets under the Cambridge brand. Fresh service departments, consisting of an on-site bakery, butchery and fresh fruit and vegetable offering form an important component of our Cambridge retail offering.

Masscash Fast Facts

Merchandise proposition: comprehensive range of food, ethnic cosmetics, liquor and groceries
Masscash Brands: Jumbo and Shield, CBW and Cambridge Food
Number of stores: 81 CBW stores, 18 Cambridge Food stores and 6 Jumbo stores. Shield has 605 members and 661 outlets
Target market: LSM 2-6
Divisional comparable store sales: 4.1% with estimated inflation of 2.1%
Total 52 week sales: R19,623.7m
2011 trading profit (before tax): R391.7 m
2011 trading area: 351 929m²
Average trading area per store: 3 352m²
CBW geographic presence: South Africa, Botswana, Lesotho, Mozambique, Namibia and Swaziland
Jumbo geographic presence: South Africa
Shield geographic presence: South Africa, Botswana, Lesotho, Namibia, Swaziland
Number of employees: 9 276

Our Value Proposition

All our stores apply the philosophy of supplying the right range of products at competitive prices to low- to middle-income wholesale customers. We keep costs down by employing a no-frills cash and carry warehouse format, coupled with basic distribution centres that supply our private label and important general merchandise ranges. Our private label food brands, Econo and Heritage, offer our customers exceptional value and the assurance of stringent quality and safety controls. Our retail stores are well located, close to high traffic commuter nodes, and offer the best quality at affordable prices.

Financial Performance (June 2011)

		2011	2010	2009
		52 week	52 week	52 week
Sales	Rm	19,623.7	17,418.0	15,215.7
Trading profit before interest³	Rm	374.8	469.1	481.9
Trading profit before interest as % sales	%	1.9	2.7	3.2

Net finance income	Rm	16.9	26.5	47.7
Trading profit before taxation³	Rm	391.7	495.6	529.6
Trading profit before taxation as % sales	%	2.0	2.8	3.5

Operating profit before taxation	Rm	404.6	498.4	533.4
Operating profit before taxation as % sales	%	2.1	2.9	3.5

Inventories	Rm	1,613.6	1,354.4	1,077.6
Inventory days	days	33	31	29

Net capital expenditure¹	Rm	244.0	95.6	117.7
Cash flow from operating activities	Rm	93.3	154.1	308.0

Number of stores		105	97	79
Trading area	m²	351,929	321,210	270,324
Average trading area per store	m²	3,352	3,311	3,422
Number of employees		9,276	8,395	5,931

Sales per store	R000	158,289	148,927	163,047
Sales per m²	R000	47	45	48
Sales per employee	R000	2,116	2,075	2,565

1.	Net capital expenditure is defined as capital expenditure less disposal proceeds.
2.	The ratios have been calculated using year-end balance sheet figures.
3.	Trading profit is earnings before asset impairments, BEE transaction IFRS 2 charges and foreign exchange movements.
4.	Shield is shown as average sales to each independently owned outlet (ie this represents only a portion of the outlet's sales).
5.	Definitions/explanations to the ratios and terms above can be found here.