Increased competition in the Belgian food market continues to hamper Colruyt Group, with the retailer seeing revenue down and costs rising. Its market share is under pressure despite the acquisition of Match and Smatch.
Poor weather conditions
31.2% is now the market share of food chains Colruyt, Okay, Spar and Comarkt in Belgium, compared to 31.6% a year earlier. Food sales did increase by 0.7% to 5.2 billion euros in the first half of the broken financial year, but this can be explained by the integration of the acquired Match and Smatch stores, which now carry the CoMarkt/CoMarché banner: without these stores, sales fell by 1.8%.
The Colruyt Lowest Prices banner lost 1.9% sales, Okay, Bio-Planet and Cru rose 1%. Colruyt Group cites poor weather conditions, strong competition and an increased number of independent stores open on Sundays. There was a strong increase for wholesale sales: this is partly explained by the fact that several independent Match and Smatch entrepreneurs switched to Spar. Noteworthy is the growth of foodservice division Solucious: +19.4%.
Growth in fitness
In non-food, Colruyt Group reported an 8.9% drop in revenue for Bike Republic in a bicycle market that is under heavy pressure, stable to slightly rising comparable revenue for fashion division The Fashion Society (Zeb, PointCarré and The Fashion Store), 20% comparable revenue growth for Newpharma and 14.9% growth for Jims. That fitness chain is now acquiring its competitor NRG, good for 40 fitness clubs.
Group sales fell 0.5% to 5.4 billion euros. Due to higher costs – including wages – operating cash flow fell 2.6% to 444 million euros and operating profit 4.8% to 245 million euros.
