Norwegian retail conglomerate NorgesGruppen has reported an operating profit of NOK 1.643 billion (€143.1 million) in the first half of its financial year, down from NOK 1.668 billion (€145.2 million) in the corresponding period last year.
The group said that investment in keeping prices low at its Kiwi chain impacted the group's operating margin by around 40 basis points, with the operating margin falling from 3.4% to 3.0% in the period. At the same time, income from investments in affiliated companies, such as Denmark's Dagrofa, had a positive effect on margins.
The group reported a turnover of NOK 54.3 billion (€4.73 billion) in the period, an increase from NOK 49.4 billion (€4.3 billion) in the same period last year.
"Our investments in price cuts have kept us competitive in a tough market," commented chief executive Runar Hollevik. "At the same time, we are able to make our operations more efficient in order to handle the increased costs, which is crucial in the times we are in, when everything costs more."
The group described competition in the market at present as 'intense', with energy, raw material costs and the price of importing fruit vegetables and coffee all weighing on the industry – not helped by the weakening of the Norwegian krone.
It has also continued to invest in sustainability, with absolute greenhouse gas emissions in its own operations reducing by 6% in the first half of 2023, and 18% compared to base year 2019.
"The results within sustainability in the first half of the year are good," Hollevik added. "We see that climate change has greater consequences for the value chain for food, and it will be important to increase the pace of measures that encourage that."