By Nqobile Dludla

JOHANNESBURG, Nov 28 (Reuters) - South Africa's SPAR

Group plans to open its first premium grocery store in

the second quarter of next year, with up to four stores planned

for the year as the retailer targets affluent shoppers.

South African grocery retailers have been refining their

strategies to appeal to both affluent and low-income customers,

to gain a bigger share of customers' wallets.

They are also moving into new non-food areas by opening

standalone stores for products such as pet and baby supplies,

clothing and outdoor adventure products, to diversify and

generate additional income.

"We're on track to launch in the first half of next year, it

might be just after Easter," SPAR Group's CEO, Angelo Swartz,

told Reuters on Thursday, having set out the plan in March. "The

launch will initially be one store, although we have three or

four planned for the year."

The retailer, which also operates in Ireland and

Switzerland, is expanding into the discount grocery market also,

through its revamped SaveMor store format.

South Africa's higher-margin, upmarket grocery niche is

dominated by Woolworths, while in the discount space,

Shoprite has Usave, while Pick n Pay has Boxer

.

Earlier, SPAR reported an 11.1% rise in headline earnings

per share, the main profit measure in South Africa, to 917.9

cents for the year ended Sept. 30, while its SPAR Southern

Africa business reported a 3.7% increase in turnover.

The company, which sold its loss-making Polish business in

September, did not declare a dividend for the year.

($1 = 18.2149 rand)

(Additional reporting by Sfundo Parakozov; Editing by Himani

Sarkar and Elaine Hardcastle)