Swedish retailer Axfood has said that consolidated net sales amounted to SEK 12.2 billion (€1.18 billion) in the second quarter of its financial year, an increase of 2.5% on the same period last year.
Operating profit was up 11.9%, to SEK 545 million, the retailer said, while net profit stood at SEK 429 million.
“Axfood delivered yet another strong quarter with good growth and profitability," commented Axfood president and CEO Klas Balkow.
In terms of first half performance, consolidated net sales were SEK 23.7 billion, an increase of 4.9%, while net profit for the period was SEK 767 million.
Last year, Balkow described the group's full-year performance as "outstanding".
Divisional Performance
All of the group's banners performed strongly in the quarter, with its Willys chain seeing 3.3% growth to register sales of SEK 6.8 billion for the period.
Hemköp posted a 4.1% increase in sales to SEK 1.6 billion, while Axfood Snabbgross saw sales rise by 9.7% to SEK 866 million.
Early summer weather led to increased sales of certain product categories as well as higher prices for fruit and vegetables, Axfood said in a statement, while increased demand for restaurant and café services helped boost Axfood Snabbgross sales.
"Despite high comparison figures and the negative calendar effect from Easter, it was positive to note that all segments showed favourable performance," commented Balkow.
"We summed up a record profit for a second quarter in which both Willys and Hemköp strongly improved their earnings."
The group noted that private label sales across its banners reached 29.2% as of the end of the second quarter, up from 27% at the same time last year.
This was mainly due to the reclassification of seafood to private label, as well as a shift in the sales mix during the second quarter, the retailer said.
Online Growth
Online sales also saw a boost in the period, with Willys rolling out e-commerce services in an additional five cities, to bring its offering to 48 stores in 27 cities.
The retailer is aiming to have Willys' online offering available in around 60 stores in 30 cities by the end of the year.
"The strong growth in online continued, and with growing volumes comes a lower burden on earnings," Balkow added.
The group also launched the online pharmacy Apophem in the quarter, to bolster its credentials in the e-commerce space.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
