Norway's Reitangruppen has posted pre-tax profits of NOK 3.4 billion for 2017, which is a significant fall from the NOK 7.3 billion the retailer posted a year earlier.
Total turnover at the business was NOK 89.1 billion, roughly on a par with the NOK 89.2 billion the group posted a year earlier.
Operating profit was NOK 3.43 billion, down from NOK 3.99 billion.
The group said a 'strong culture' across its business, as well as its franchisees taking more 'personal ownership' of their operations, helped the company post strong turnover figures for the year.
"2017 was a very good year," commented Odd Reitan, chief executive of Reitangruppen. "We did not do everything right, but we did more right than wrong. I'm most proud of our merchants who, together with us, have created both jobs and improved our values."
Profit Performance
The dip in profit performance is linked to a challenging year for Rema 1000, which accounts for around three quarters of the group's operations.
A Nielsen study on Tuesday revealed that the Norwegian grocery market saw its lowest growth for several years in 2017, posting 1.1% growth year-on-year.
Rema 1000 dropped one percentage point in that period, at the expense of its rivals, Nielsen said.
According to Reitangruppen, the Rema 1000 business, which trades in both Norway and Denmark, posted turnover of NOK 66.4 billion last year, down from NOK 67.8 billion a year earlier.
Operating profits at Rema 1000 were down to NOK 1.7 billion, from NOK 2.3 billion last year.
"Never before has the team spirit in the face of opposition been bigger," commented Retain on the performance of Rema 1000. "Our stores have never looked better, and we have never learned as much as we did in 2017."
The company added that the year 2018 has 'started well' for Rema 1000 in both countries in which it operates, with the company increasing its focus on low prices and high quality, responsibly produced products.
"We have had a good start to 2018, customers are returning and we are recapturing market share," said Reitan.
Reitan Convenience
Elsewhere, the group's Reitan Convenience arm, which includes the Narvesen, Pressbyrån, 7-Eleven, R-kioski and Northland brands, posted turnover of NOK 15.9 billion, the same as last year, with operating profit down slightly to NOK 569 million (NOK 578 million).
"We are well positioned in all our seven markets and have major growth ambitions in Europe,"commented the director of Reitan Convenience, Johannes Sangnes.
Its Uno-X Energi fuel supply operation saw its turnover rise to NOK 9.89 billion (NOK 8.5 billion).
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
