Discount retail chain Netto's owner Salling Group announced record financial results for 2020. In the year of the COVID-19 pandemic, the company recorded a historic revenue record for the first time it exceeded the threshold of 60 billion Danish kroner - reaching 60.9 billion DKK (US$10.7billion). The EBIT profit increased to DKK 2.8 billion (US$450million), which makes an EBIT margin of 4.6%. Salling Group announces that it will maintain its development strategy, the main assumptions of which are investments in e-grocery and expansion in Poland, including the rapid rebranding of stores acquired from Tesco to the Netto 3.0 format. The operation, costing approximately DKK 1.5 billion (US$240 million), is expected to end in the first half of 2022.
The revenues of the Salling Group, the owner of the Netto Polska discount stores, increased by over DKK 4 billion (US$650million) in the last financial year. Gross profit EBITDA increased to DKK 4.7 billion (US$760million), the equivalent of 7.7% total revenues. A year earlier, this parameter was DKK 4.1 billion (US$660million).
The COVID-19 pandemic affected the company's day-to-day operations in all markets, it was necessary to change the structure of retail networks, including the relocation of products and personnel from closed outlets and localities subject to lockdowns. Meeting the frequently changed sanitary recommendations and restrictions was also a challenge.
'We are aware that the food trade was one of the few industries that ultimately benefited from the pandemic restrictions, which in our case translated into record sales results. In view of the above, I would like to express my particular satisfaction that in this challenging year we managed to implement a number of strategic priorities that will affect the future of the group in the coming years,' said Per Bank, CEO, Salling Group.
Salling Group reminds that in March 2021 it finally finalized the acquisition of most of Tesco's business in Poland, for the amount of 1.5 billion DKK (US$240million). The group announces that it intends to invest another DKK 1.5 billion (US$240million) in this business, which it will spend on the transformation of the acquired facilities, in accordance with the latest Netto 3.0 concept. The conversion of all stores taken over from Tesco should be completed in the first half of 2022.
According to data from December 31, 2020, the Netto discount chain consisted of 522 stores in Denmark, 342 in Germany and 394 in Poland.