DIA Posts Sales Of Over €10 Billion Despite Domestic Declines
Spanish retailer DIA has posted gross sales of €10.3 billion in 2017, representing an increase of 1.5% compared to the previous year.
The company saw 10.8% sales growth in emerging countries, however, this was offset by a 3.3% decline in its Iberian business, which includes Spain and Portugal.
In the group's domestic market of Spain, sales fell by 3.8%, to €5.7 billion, due to a reduction in selling space, but DIA says that it regained its price competitiveness in the second half of the year.
In Argentina and Brazil, DIA has continued to gain market share, reaching 14.1% and 7.7%, respectively, with EBITDA increasing to €142.3 million.
Ricardo Currás, CEO of DIA Group, said that 2017 was the first year since the company's listing in 2011 that it has not met its financial targets.
"Our results were lower than the revised guidance issued in October, as the investment in prices was higher than initially anticipated," Currás said. "Our decision to maintain our price leadership in Spain had an impact on our margins that could not be offset by the cost-saving efforts and benefits captured by our procurement alliances."
"With the exception of Spain, all the other countries in which DIA is present [Brazil, Argentina, and Portugal] met the targets set for the year," he added.
The company says that during the year it made progress with its digitalisation initiative, including programmes such as Nexus by DIA, the group's digital innovation platform, as well as new partnerships.
DIA continued to work with online retail giant Amazon, extending grocery delivery from La Plaza de DIA stores through Amazon Prime Now to Valencia and Barcelona, as well as the capital city, Madrid.
The retailer also announced that its own-brand products under the Clarel label will now be available in German, Italian, French and British markets – again, through Amazon. Additionally, Amazon lockers were installed at a number of stores in Madrid.
Elsewhere, in December, DIA expanded its joint venture with France's Groupe Casino, with the creation of a new company, CD Supply Innovation SL.
The new company, which will be based in Madrid, will be ‘international in scope’ and ‘responsible for some management of financial services and logistics, as well as payments and procurement’, primarily relating to the business’s private-label operations.
Last year, 613 stores were remodelled in Spain and Portugal, and the retailer has plans to refurbish a further 1,000 stores in 2018, offering new services and solutions.
At the end of 2017, DIA had a total of 7,338 stores across Spain, Portugal, Argentina and Brazil.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.