Good start to the year – strong growth with higher earnings
President and CEO Klas Balkow’s comments on the first quarter 2018:
“Axfood’s first quarter in 2018 shows a truly good start to the year, with strong growth and higher earnings. Sales in our stores were far higher than estimated market growth, which shows that we continue to gain market shares. The Willys stores, in particular, had good sales for the entire quarter and capped this off with very strong Easter sales.
“E-commerce continues to develop favourably in all our concepts. Today we reach more than 5 million consumers through our online offering, and we continue to develop our digital services. The strong online shopping is good for sales, but continues to weigh down earnings. Despite this, we delivered a higher operating profit than the same quarter a year ago. With an operating margin of 3.8% we are on track to our long-term target of 4%, and we continue to deliver according to our strategic agenda.”
First quarter summary
- Consolidated net sales amounted to SEK 11,444 m (10,639), an increase of 7.6%.
- With strong store sales growth of 9.7% and vibrant growth in e-commerce sales, Axfood continues to take market shares.
- Operating profit was SEK 435 m (397), an increase of 9.6%. The operating margin was 3.8% (3.7%).
- Net profit for the period was SEK 338 m (309), and earnings per share before dilution were SEK 1.61 (1.47).
- At the start of the year the previously announced reorganization was carried out, entailing the transfer of customer responsibility for Tempo to Hemköp, the reporting of Axfood Snabbgross as a separate segment, and the transfer of other Axfood Närlivs customers to Dagab.
- The Annual General Meeting approved the Board’s proposed dividend of SEK 7.00 per share (6.00).
Significant events after the balance sheet date
- Axfood’s board of directors has decided on the repurchase of a maximum of 240,000 shares coupled to the long-term share-based incentive programme LTIP 2018. Share repurchases can commence on 15 May.
Welcome to today’s presentation where President and CEO Klas Balkow together with CFO Anders Lexmon will present the first quarter of 2018. The presentation will be held at Hemköp’s “Rekobutik”, Norra Stationsgatan 80 A, at 9:30 a.m. The presentation will also be webcast and can be followed via axfood.se or monitored by phone:
Sweden: +46 8 566 426 62, UK: +44 203 0089 804, US: +1 855 735 2235.
Axfood aspires to be the leader in good and sustainable food. Our 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 our 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 SEK 50 bn. Axfood has been listed on Nasdaq Stockholm since 1997, and the principal owner is Axel Johnson AB. Read more at www.axfood.se.