The Colruyt supermarkets lost market share as a result of the corona crisis, according to annual figures from Colruyt Group. Sales have narrowly passed the ten billion euro mark and profit forecasts are highly uncertain.
Food stores are losing ground
Colruyt Group’s turnover increased by 3.7% to more than 9.9 billion euros in the reference period 2020/21. Excluding fuels, the sales increase was 6.4 percent – Dats saw sales drop significantly, by more than 25 percent. The gross profit margin was 28.1 percent of sales, in part due to less promotional pressure. But the costs have also increased, due to corona measurements and other investments. The two tendencies have neutralized each other. Net income amounted to 385 million euros, i.e. 3.9% of turnover – i.e. excluding the capital gain that the group was able to achieve thanks to the contribution of Eoly Energy to a new holding company. It is a little less than what analysts expected. The previous year, the net result was 380 million euros, or 4.0% of sales.
The performance of food stores was particularly expected. Competitors Delhaize and crossroads claimed market share gains in recent quarters. And indeed: the market share of Colruyt Lowest Prices food stores, OK and Longeron the whole fell to 31.3 percent, admits Colruyt Group. In the 2019/20 financial year, it was still 32.1%. The explanation is obvious: the group has proportionately fewer convenience stores than its competitors, and exactly those convenience stores did better than other store formats during the corona crisis.
“Difficult to match”
Colruyt’s sales in Belgium and Luxembourg increased by 3%, in France by 7.2%. OK, Bio-Planet and Believed together achieved revenue growth of 12.5 percent. Wholesale sales – including sales from Spar stores – increased by 15.5% in Belgium and France. Catering wholesaler Solucious saw its turnover drop by 13.4%.
Non-food retail sales grew more strongly: up 37.6%, but this is mainly due to the global integration of Fashion society, the holding company of ZEB, Square Point, The fashion store and ZEB for the stars clothing chains. Combined in-store sales of Dreamland, dream baby and Bicycle republic (formerly Fiets!) fell 2.7 percent, due to mandatory store closings. Online sales have grown strongly, both in food (Collect and take away) and non-food, but the retailer does not provide details on this.
Because the uncertainty resulting from the corona crisis is too great, Colruyt Group does not venture to give concrete forecasts for the current financial year. The company says the consolidated net profit for the previous year “will be difficult to match.”