Sweden's Axfood Sees Sales Up, Albeit Impacted By Tough Comparatives
Swedish retailer Axfood has posted a 1.0% increase in consolidated net sales in the first quarter of its financial year, although chief executive Klas Balkow noted that its performance was impacted by "high comparison figures", one year on from the start of the pandemic.
Store sales across the group were up 2.4%, it said, to SEK 11.76 billion (€1.16 billion), while operating profit totalled SEK 565 million, an increase of 3.9%.
“Axfood had a solid start to the new year, but for understandable reasons the 2.4% growth in store sales was considerably lower than during prior quarters," Balkow said.
"After more than a year into the pandemic, we have begun to meet high comparison figures. In addition to a negative calendar effect, this quarter is compared with a first quarter a year ago that was dramatically affected by hoarding."
The group said that its e-commerce platforms 'continue to experience sharp growth', rising by 139% in the quarter, compared to the same period last year.
In terms of the performance of its individual banners, Axfood said that first quarter sales at Willys were up 3.2% in the quarter, while like-for-like sales increased by 0.4%.
While the Willys banner 'grew faster than the market', its Eurocash arm, which is part of the Willys segment, saw sales down by more than 80% due to the closure of the Norway-Sweden border for non-essential travel.
At Hemköp, overall store sales were up 0.8%, however while sales among franchise stores rose by 4.7% on a like-for-like basis, group-owned stores saw sales down 1.1%.
According to Axfood, this was largely due to group-owned Hemköp stores being situated in central locations in larger cities, which have been impacted by reduced traffic.
Restaurant wholesaler Snabbgross saw sales down 5.3% in the quarter, Axfood said, while Dagab, its purchasing arm, saw sales up 2.1%.
Announcing the results, Balkow also noted that the group would be moving its fruit and vegetable warehouse from Helsingborg to a "new, larger and more efficient warehouse" in Landskrona, which offers "good opportunities for future expansion and automation".
Work is also continuing on a new automated logistics centre in Bålsta, outside Stockholm, which is set to become operational by 2023, while a new transport management system, aimed at creating a 'better overview of transport flows and manage flows to customers and e-commerce consumers', is also under development, again with a planned 2023 rollout.
Elsewhere, Axfood's board of directors has announced that the firm will repurchase a maximum of 310,000 shares in connection with the long-term incentive programme LTIP 2021.