Stockholm / SE. (axf) During the third quarter 2023, Sweden’s Axfood AB continued to report strong growth and stable profitability, a testament to the fact that customers appreciate the Group’s affordable and competitive offering. At the same time, Axfood continued to pursue an extensive development agenda to strengthen its position for the future, and took major steps in the establishment the Group’s new warehouse and logistics structure during the quarter.
President and CEO’s comments on the interim report for Q3-2023
President and CEO Klas Balkow’s comments on the interim report for the third quarter 2023 as follows: «Despite high comparison figures, Axfood delivered robust growth of 13 percent during the quarter, compared with 6 percent growth in the food retail industry. Axfood’s growth was thus twice as high as the market’s, which follows the trend we have seen since the beginning of last year.
«Willys once again reported exceptional growth, reaching an impressive 16 percent this quarter. The number of new customers and members of Willys Plus is continuing to grow at a rapid rate, and new and existing customers alike are becoming increasingly loyal and shopping more at the chain.
«With a clear focus on price value, Hemköp grew faster than the market for the fourth consecutive quarter. In a market that mainly favours the low-price players, Hemköp delivered a strong performance. It is truly gratifying to see a return on the chain’s investment in store modernisation and assortment development, with a focus on health and sustainability.
«At the same time, we are seeing a certain slowdown in the café and restaurant market from previously high levels. Nevertheless, Snabbgross’s focus on an affordable and flexible offering generated favourable growth, resulting in a higher market share.
«In line with the trend in the first half of the year, operating profit increased in the third quarter, and the adjusted operating margin was on a par with the previous year. This profit trend was attributable to the Group’s strong sales growth, which compensated for the continued market investments in the store chains, negative currency effects and higher operating expenses, such as increased rental levels and salary costs.
«It is with a sense of humility in the face of an uncertain global backdrop that I present a strong third quarter for Axfood. It is clear that more and more customers appreciate the offerings of our various store concepts and operations. Together with all of our dedicated employees, we will maintain a high level of ambition and pace of development in order to further strengthen our position in the market.»
Third quarter summary
- Net sales totalled SEK 20,293 million (18,674), an increase of 8.7 percent.
- Retail sales totalled SEK 15,873 million (14,026), an increase of 13.2 percent.
- Operating profit amounted to SEK 1,036 million (975) including items affecting comparability of SEK -60 million (-40). The operating margin was 5.1 percent (5.2).
- Adjusted operating profit amounted to SEK 1,095 million (1,015), an increase of 7.9 percent. The adjusted operating margin was 5.4 percent (5.4).
- Net profit for the period amounted to SEK 738 million (745) and earnings per share before dilution to SEK 3.38 (3.40).
- In September, a dividend of SEK 4.00 per share was paid out, the second part of the dividend to shareholders totalling SEK 8.15 (7.75) per share.
Summary January to September (9M-2023)
- Net sales totalled SEK 60,342 million (53,735) an increase of 12.3 percent.
- Retail sales totalled SEK 47,196 million (40,541) an increase of 16.4 percent.
- Operating profit amounted to SEK 2,609 million (2,599) including items affecting comparability totalling SEK -179 million (103). The operating margin was 4.3 percent (4.8).
- Adjusted operating profit amounted to SEK 2,787 million (2,496), an increase of 11.7 percent. The adjusted operating margin was 4.6 percent (4.6).
- Net profit for the period amounted to SEK 1,841 million (2,017) and earnings per share before dilution to SEK 8.50 (9.43).
Significant events after the balance sheet date
- Hans Bax was appointed as the new Managing Director of Dagab and effective 1 February 2024 will succeed Nicholas Pettersson, who will take on the role as Managing Director of Willys on the same date.
- The Nominating Committee of Axfood proposes that Thomas Ekman be appointed new Chairman of the Board at the Annual General Meeting in 2024. Axfood’s current Chairman, Mia Brunell Livfors, has declined re-election.