Swedish retailer Axfood has started its financial year with strong growth, increased market share and increased earnings in all business segments during the first quarter.

The company saw a net sales increase of 25.7% to SEK 16.6 billion (EUR 1.6 billion), including the acquisition of Bergendahls Food.

Its retail division had sales of SEK 12.7 billion (EUR 1.2 billion), an increase of 4.1% compared to the same period last year.

Commenting on the company’s development, Axfood’s CEO Klas Balkow said, “We continued to maintain a high pace in all parts of the business during the first quarter and we started the year with sales growth in retail that is significantly higher than the market.

“This shows that our food and store concepts continue to attract existing and new consumers who value affordable, good and sustainable food.”

Quarterly highlights

Adjusted operating profit increased by 15.5% compared with the previous year to SEK 653 million (EUR 63.7 million), while the adjusted operating margin decreased to 3.9% from 4.3% last year.

Net income for the quarter amounted to SEK 682 million (EUR 66.5 million), while earnings per share before dilution were SEK 3.30.

Balkow added, “All operating segments reported higher operating profit for the quarter, with strong sales and healthy productivity gains that compensated for significantly higher fuel costs and a weak SEK.

“As a result, we can report a higher adjusted operating profit of SEK 653 million and an adjusted operating margin of 3.9%, which was diluted by the consolidation of Bergendahls Food.”

According to Balkow, Sweden has seen a sharp rise in food price inflation in recent months, driven by higher prices for raw materials, packaging materials, fuel, electricity and transport.

“What is happening now in Ukraine is causing increased uncertainty and instability, and there is much to suggest that prices will continue to rise,” he added.

Axfood’s Annual General Meeting on March 23 decided on a dividend of SEK 7.75 per share, paid in two parts.

The first payment of SEK 4.00 was made to the shareholders in March and the second payment of SEK 3.75 will take place in September, the company added.

© 2022 European Supermarket Magazine – your source for the latest retail news. Article by Dayeeta Das. Click subscribe to sign up for ESM: European Supermarket Magazine.