Retail Sales Surge At Poland's Eurocash Group In First Quarter
Retail sales were up by double digits at Polish retailer Eurocash in the first quarter of its financial year, as the group posted total sales of PLN 5.92 billion (€1.3 billion) for the period.
However the group posted a net loss of PLN 62 million (€13.4 million) for the quarter compared to a net loss of PLN 40 million in the corresponding period last year.
Eurocash said that sales in its retail segment were up 12% year-on-year, while wholesale sales rose by 6%.
The group posted EBITDA of PLN 126 million (€27.6 million) in the period, which was a 4% increase on the previous year, noting that COVID-19 preparation measures impacted its operating profit to the tune of PLN 10 million.
EBITDA in its core wholesale segment rose to PLN 114 million, which is 13% higher than a year ago, it noted.
Factors which led to the group posting a net loss for the period included the revaluation of leasing contracts in accordance with IFRS 16 standards, which impacted performance by PLN 25.5 million (€5.6 million).
The group said that the 'high dynamics' of like-for-like sales in its cash & carry warehouses, including increased tobacco sales, had a positive impact on its wholesale performance, which in turn offset declines in its HoReCa business.
In addition, the integration of Eurocash Dystrybucja with Eurocash Alkohole, which was completed last year, has also brought positive results.
In its retail arm, the Delikatesy Centrum business was a core sales driver, with like-for-like sales up 11.3%.
Elsewhere, its 'Projekty' arm, which includes the Duży Ben liquor store banner, the abc na kołach retail business and the Kontigo cosmetics business, saw sales of PLN 38 million in the period, which was 2.4 times higher than a year ago.
Commenting on the impact of COVID-19 on its business, Jacek Owczarek, finance director at Eurocash Group said, "The scale of our activity imposes a unique responsibility on us in the age of the coronavirus pandemic. Our activities are focused on ensuring the continuity of food supplies to stores, while maintaining the highest level of security for our employees and customers."
He added that the coronavirus epidemic brought a "temporary increase in sales in both the retail and wholesale segments", however this was offset by a decline in sales in HoReCa.
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.