Supermarket sees £13m fall in earnings

Iceland

Supermarket chain Iceland Foods saw a fall in earnings of £13m over the last 12 months.

The Deeside firm has released its annual results for the 12 months to March.

Sales were up 4.5% to £3.084bn on comparable 52 week basis ahead of UK grocery market as a whole.

Adjusted EBITDA £140.1m, down £13m on comparable 52 week basis.

The shortfall was in the first 12 months of the year and there was a stable profit performance in second half.

Over the course of the year 43 new stores opened and The Food Warehouse chain expanded to 90 stores.

A strategic alliance was formed with The Range and the Iceland food offer was added to nine stores.

Iceland Group Chief Executive Tarsem Dhaliwal said: “Within an intensely competitive UK market place, adversely affected by consumer uncertainty and the well-known pressures of changing shopping habits on the high street, we have continued to focus on investing for the future: expanding our store footprint, enhancing the appeal of our existing stores, growing our award-winning Online business, continuing to roll out new and exciting food lines that are unique to Iceland, developing our supply chain to support the growth of our retail estate, and finding new channels to sell our food through The Range in the UK and a growing global franchise and export business.

“Our sustainability initiatives over the last year have substantially raised public awareness of Iceland and enhanced respect for our brand and its values, and we are confident that this can only enhance our prospects in the longer term.”

Increased staffing costs as a result of the rise in the National Living Wage and increased distribution costs affected profits.

Exceptional administrative expenses of £14.9m were incurred during the year which included business restructuring, compliance, property and other costs.

Tarsem Dhaliwal added: “Prolonged uncertainty over the nature of timing and Brexit continues to dampen consumer confidence, but we are confident of our ability to trade successfully through any likely future scenario.

“Iceland is a privately-owned British family company with an immensely supportive external investor, and this ownership structure is critical to our ability to focus on, and invest for, the long term.

“We have the benefits of a great brand, unique products, outstanding people, a stable capital structure and a proven, strong cash generating capability.”

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