Stockholm / SE. (axf) Next week Sweden’s Axfood AB invites investors, analysts and so on to a presentation of the interim report for the first quarter 2021. At bakenet:eu we don’t know anything about the leading food retail group in Sweden and the second largest player in the Swedish food retail market with a market share of approximately 20 percent. The family of companies includes the store chains Willys and Hemköp as well as Tempo, Handlar’n and Direkten. B2B sales are handled through Axfood Snabbgross, and the support company Dagab is responsible for the Group’s product development, purchasing and logistics. The Axfood family also includes Mat.se, Middagsfrid and Urban Deli as well as the partly owned companies Apohem and Eurocash. Together the Group has more than 10,000 employees and sales of nearly 50 billion Swedish Crowns (SEK) or 4,9 billion Euro (EUR). So, before we look at Axfood’s Q1-2021 next week, we would like to introduce you to fiscal 2020, which was an exceptional year also for Axfood Group. Let’s go:
A strong fourth quarter ends an exceptional year
A strong fourth quarter sums up an exceptional 2020, a year in which Axfood continued to grow faster than the market and with improved profitability. Even though the pandemic has required immense focus, a high pace of development has been successfully maintained and progress in ambitious investments for the future – the family of companies reported in February 2021.
President and CEO Klas Balkow’s commentary
President and CEO Klas Balkow’s comments on the year-end report 2020: «Axfood’s favourable performance continued during the fourth quarter with 7.4 percent growth in store sales. High productivity in Dagab and improved delivery reliability laid the foundation for a good Christmas shopping season and a strong close to the year. At the same time, online B2C sales grew by a full 157 percent and continued to be driven by considerably higher growth for the store pick-up delivery option, Click and Collect. It is gratifying that we managed to end the year with stronger earnings during the fourth quarter and improved profitability. On the tailwinds of a financially strong year we are continuing development in areas such as logistics, with automation and transport optimization, upgraded IT platforms, new checkout systems, more stores and new concepts, a higher degree of digitalization and a more data-driven way of working. We are also stepping up the pace and raising our level of ambition in the area of sustainability with focus on the entire value chain.»
Fourth quarter summary
- Consolidated net sales totalled SEK 13,633 million (13,040), an increase of 4.6 percent.
- Operating profit totalled SEK 566 million (487), an increase of 16.1 percent. The operating margin was 4.1 percent (3.7 percent).
- Net profit for the period totalled SEK 409 million (359), and earnings per share before dilution were SEK 2.02 (1.68).
- The quarter was characterized by changed shopping behaviour among consumers due to the spread of the coronavirus/Covid-19. An increase in consumption of food at home had a favourable impact on sales. However, certain businesses with exposure to cafés and restaurants as well as cross-border shopping and central locations where customer traffic has decreased significantly continued to be negatively impacted, and to a higher negative extent than during the third quarter.
- In November Snabbgross launched a new B2C store concept, Snabbgross Club.
Summary January to December 2020
- Consolidated net sales totalled SEK 53,696 million (50,740), an increase of 5.8 percent.
- Operating profit totalled SEK 2,510 million (2,288), an increase of 9.7 percent. The operating margin was 4.7 percent (4.5 percent).
- Net profit for the period totalled SEK 1,862 million (1,679), and earnings per share before dilution were SEK 9.12 (7.87).
Significant events after the balance sheet date
- The Board of Directors proposes an increased dividend of SEK 7.50 per share (7.25). The dividend is split up into two payment occasions.
- Capital expenditures in 2021 are expected to amount to SEK 1,800 to 1,900 million excluding acquisitions and right-of-use assets.
- During 2021 Axfood plans to establish 5 to 10 new stores.