The COVID-19 pandemic has dominated global headlines for more than two years now, and the impact it has had on several industries, such as travel, hospitality and restaurants, has been damaging.

This being said, through the recent surge in demand for household goods, groceries, and other necessities brought about by the pandemic, global consumer staple companies were inevitably positively impacted and PG plc (PG) is no exception.

In terms of the Group’s supermarket operation, PG recorded an increase in turnover of 12.1 per cent in terms of its’s two supermarkets and associated retail operations at Pama and at Pavi during H1-22, reflecting their continued local popularity. Management further added that while the Group registered a growth of 9.7 per cent at Pama, growth during H1-22 stood at 10.5 per cent at Pavi.

Contrarily, revenue generated from PG’s franchise operation, amounted to €12.5m during H1-22, reflecting an overall increase of 43 per cent on a comparative basis (H1-21: €8.7m). Management reported that this improvement in the Zara and Zara Home segment sales was initiated through a renewal of consumer confidence following a successful vaccination program during the first half of PG’s financial year (May21 – October21), notably attaining pre-pandemic turnover levels. In addition, other attributes contributing towards this improvement in the Group’s franchise business include the continued use of the on-line facilities offered in this respect.

On a consolidated basis, during the first six months of the year, the Group registered an overall turnover of €71m, representing a healthy growth of 16.5 per cent on a comparative basis (H1-21 €60.9m).

In view of the aforementioned growth in business, PG’s overall operating expenditure increased to €59.9m, demonstrating an overall uplift of circa 16.1 per cent when compared to the first six months of 2021. In terms of finance costs, the Group posted a decline in net finance costs of 11 per cent, with this being predominantly reflective of PG’s ambition and ability to settle its debt obligations at an accelerated pace. Additionally, PG reported a profit before tax of €8.6m, representing a growth of 20.1 per cent on a comparable basis.

Meanwhile, PG also resolved to distribute a net interim dividend of €2.25m, translating into a dividend of approximately €0.021 per share.

Notwithstanding the difficult conditions in which the Group continued to operate in as the pandemic related climate persisted, PG remained strategically positioned predominantly in terms of its unique offering, and as noted above, continued achieving strong financial results and ultimately exceeding expectations. Notably, this is reflective of the Group’s defensive business model, which irrespective of any economic scenario, has the ability to maintain a healthy and stable level of revenue, cash flow and profit generation. On a positive note, the Group also has a favourable cash position and a relatively low leveraged balance sheet, which importantly, has enabled the Group to pursue new growth opportunities in its core line of business. Specifically, in an attempt to improve its overall efficiency within its supermarket stores, the Group is in the process of replacing existing IT infrastructure with a modern, robust and multi-store IT system.

While other IT improvements are expected to continue being implemented in the current financial year, management further stated that the Group is currently in discussions over a possible extension to the Pama Shopping Village directly on adjacent portion of the site, with a rental agreement expected to be completed soon.

This article was issued by Andrew Fenech, research analyst at Calamatta Cuschieri. For more information visit The information, view and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice.