NorgesGruppen has posted a 9.3% increase in operating income to NOK 112.2 billion (€9.7 billion) in its financial year 2023.
Despite reduced profit on goods due to price pressure in its Kiwi chain, its performance reached a level that is on par with the years before the pandemic, the retail group said.
Overall, NorgesGruppen achieved cost reductions of NOK 1.2 billion (€100 million) compared with 2022, half of which were reduced electricity costs.
Profit for the year amounted to NOK 3.4 billion (€290 million), with a profit margin of 3.1%, up from 2.8% in 2022.
NorgesGruppen CEO Runar Hollevik stated, "Tough price competition combined with sharp price increases for the goods we buy put pressure on our margins last year.
"Despite the reduced profit on goods sold, the profit for the year was strengthened as a result of increased productivity and strong underlying operations."
A Challenging Year
High inflation and reduced purchasing power of consumers made 2023 a challenging year for the retail sector in Norway.
Price reduction measures implemented by Kiwi in February of last year resulted in growth in customers and consolidated the banner's position in the country.
Kiwi closed the year with more than 700 stores, making it the largest chain in Norway, NorgesGruppen noted and added that the chain surpassed the NOK 50 billion (€4.3 billion) turnover milestone for the first time.
'Fantastic Customer Growth'
Hollevik commented, "In a changing market, we are very pleased to strengthen our market position in the food market.
"We are experiencing fantastic customer growth as a result of several important initiatives from our chains, and the stores are proving to be adaptable when our customers experience that everything costs more. This continues to provide us with good conditions for the long-term development of all our businesses."
The retail group's market share stood at 27% with sales of approximately NOK 360 billion (€31.1 billion) in 2023, marking an increase of about 6%.
Data from Statistics Norway showed that food and beverage price growth in Norway over the past 24 months has been lower than in Sweden and on a par with Denmark, the company noted.
Sustainability
The Norwegian retailer reduced greenhouse gas emissions from its operations by almost 7% during the year. The reduction has been more than 18% compared to 2019.
The company attributed this achievement to a significant reduction in food waste, lower electricity consumption, and investments in the transition from fossil fuels to renewable energy.
