Finnish retailer Kesko has reported a 1.3% year-on-year decline in reported net sales, to €5.9 billion, in the first half of its financial year.
Comparable operating profit for the period to 30 June 2024 amounted to €277.7 million, down from €333.5 million the year before, the company noted.
The company's operating profit declined to €256.4 million, from €328.9 million in the same period last year.
Outlook
Kesko expects net sales and operating profit to remain at a good level in 2024 despite challenges in its operating environment.
Comparable operating profit for full-year 2024 is estimated to range between €620 and €680 million, down from its previous guidance of between €620 million and €700 million.
Key uncertainties impacting the outlook are inflation and interest rate levels, and geopolitical crises and tensions, the company noted.
Kesko anticipates a stable performance in B2C trade and the foodservice market in its trade division, despite price competition.
Inflation is expected to slow down in 2024 and profitability in its grocery trade is estimated to remain good, according to the company.
Quarterly Performance
Net sales across the group amounted to €3.1 billion in the second quarter, with reported sales down 0.4% year on year.
Comparable operating profit for the quarter was €178.3 million, down from €207.6 million in the same period last year.
According to the president and CEO of Kesko, Jorma Rauhala, the company's second-quarter performance was "in line with expectations, and Kesko again managed a good performance in a challenging market."
Net sales in its grocery trade division reached €1.6 billion, representing a decrease of 1.7% year-on-year, while comparable operating profit stood at €114.5 million.
K Group grocery sales were down by 1.1% in the second quarter, while online grocery sales grew by 13.5%, driven mainly by express deliveries.
Net sales in the company's foodservice business decreased by 1.3% but still outpaced market growth.
In the second quarter, price inflation in groceries slowed down to 0.1% and customer flow continued to grow.
