Axfood strengthened market positions
With a continued positive customer influx and increased volumes Axfood concludes a fourth quarter and year with strengthened market positions. Through the acquisition of City Gross from Bergendahls, a new and prominent position is taken within the hypermarket segment in Sweden.
Several improvement initiatives have been initiated to develop the hypermarket chain towards growth and profitability. In addition, the tuning of the new logistics center in Bålsta[i] is now gradually having an effect, Axfood argues in a press release.
"Growth in retail sales amounted to 14.1 percent in the fourth quarter. Market dynamics are characterized by a more restrained and price-conscious consumer and intense competition.[ii] Our focus on productivity and cost efficiency has intensified, and with our structure and the investments we are making we have a good starting point to gradually improve our competitiveness over time," says CEO Simone Margulies.
The Golden Goose
Willys continued to grow more than the market during the last quarter of the year with a growth of 4.8 percent. Willys has never before had a stronger market position. Willys is the golden goose in Axfood these days, little doubt about that, but the supermarket chain Hemköp also grew by 4.6 percent.
Since the ramp-up of the new logistics center in Bålsta was completed last fall, the focus has been on fine-tuning the operation.
In parallel with the optimization of store flows, the implementation of e-commerce flows is also underway. Group management claims that they are beginning to see increased productivity throughout the system due to the updated warehouse in Bålsta.
City Gross is still not profitable, but it is believed that it will reach a profit by the end of 2026.
Ambitions to expand
Axfood will continue to maintain a high establishment rate in 2025 and in the coming years. The ambition is to expand the store network with 10-15 new self-owned stores in 25, the majority of which will be Willys stores, according to Margulies.
Axfood has a sound financial position and in 2025 the Group's investment needs are estimated to amount to SEK 1.6-1.7 billion.
Summary of Key figures 2024
- Net sales amounted to SEK 84,057 million (81,111), an increase of 3.6 percent.
- Retail sales were SEK 68,052 million (63,703), an increase of 6.8 percent. Excluding City Gross, the increase was 4.3 percent.
- Operating profit was SEK 3,290 million (3,353)
- Adjusted operating profit amounted to SEK 3,433 million (3,602). The adjusted operating margin amounted to 4.1 percent (4.4).
- Profit for the period amounted to SEK 2,219 million (2,373)