Finnish retail group Kesko has announced that net sales from January to December 2017 rose 4.9% to €10.67 billion, representing like-for-like growth of 1.8%.
Operating profit rose to €324.6 million from €146.8 million in the previous year, while diluted earnings per share grew from €0.99 to €2.59.
Looking at the group's grocery business, net sales increased by 2.4% during the year. However, in comparable terms, sales were up by 0.9%, affected by the acquisition of Suomen Lähikauppa in April 2016, as well as the divestment of Russian business operations in November 2016.
"In the grocery trade, 2017 was a year of strong and successful transformation, resulting in increased market share, sales and profitability," said Mikko Helander, CEO of Kesko.
"We implemented our strategy by redesigning all of our chains, with the objective of offering the most customer-oriented and inspiring food stores in Finland. The expansion of our store network and store redesigns proceeded according to plans."
Kesko also made management changes to its grocery business in 2017. Jorma Rauhala, head of the grocery trade division, was appointed president of the group's building and technical trade, and was replaced by Ari Akseli, who was previously in charge of commerce in the grocery unit.
Outlook
Kesko says that sales for the next 12 months are expected to exceed these results in comparable terms, however, due to divestments and restructuring, the group is anticipating a fall in net revenue.
It said that investments in store openings and redesigns, expansion of logistics operations and digital services will affect profitability during the coming year.
"Kesko’s financial position is strong and it enables good dividend capacity and active business transformation," added Helander.
"We will continue the customer-oriented transformation of K Group, and the results for 2017 show that we are on the right path."
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Sarah Harford. Click subscribe to sign up to ESM: The European Supermarket Magazine.
