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Musgrave Group plc, partner to entrepreneurial food retailers and foodservice professionals across Ireland, the UK and Spain today (17 June 2010) reported its financial results for the year ended 31 December 2009.

The Group reported overall sales of €4.5 billion, down 3 per cent on 2008 on a constant currency exchange rate basis, with profit before tax of €70 million, down 7 per cent. Despite the difficult trading conditions, net debt was reduced from €86.2 million to €59.0 million.

Commenting, Chris Martin, Group Chief Executive Officer, Musgrave Group, said, “This is a satisfactory performance and positions the Group well to support our retailers through the challenges of 2010. We have successfully adapted our strategy to manage a tough and challenging trading environment in all our markets, and we are pleased to report a satisfactory sales performance in Ireland and an increase in UK sales.

In Ireland, the challenges have been significant. In 2009 the grocery market and food service markets declined by 7 per cent and in excess of 20 per cent respectively. Overall sales in Ireland were €2.7 billion, 7 per cent down on 2008. However, by delivering lower prices to the consumer, through re-structuring our business, increasing support to our retail partners and through their investment in their stores, our SuperValu, Centra and Daybreak brands outperformed the market. This performance is testament to the strength of the ongoing partnership between Musgrave and its retail partners coupled with their enterprise and investments.

Our commitment to continue to support Irish suppliers has been a central part of our strategy. 75 per cent of everything sold in SuperValu and Centra was purchased from Irish suppliers during the year. In 2010, our retail partners, who own their stores and live and work in their local communities, are starting to see volume growth again.

In the UK, our businesses in Northern Ireland and Great Britain made good progress delivering sales of £1.4 billion, a growth of 3 per cent. 2009 saw the completion of major system and supply chain projects, as well as the successful integration of J&J Haslett. Our retail brands SuperValu and Centra in Northern Ireland and Budgens and Londis in GB recorded good performances. Our business model for independent, community-centred retail is gaining traction in the UK market.

In Spain we have continued with our programme of selling our stores to independent retailers. By the close of 2009 over 50 per cent of all Spanish retail sales were to independent retailers. The impact of this, together with food deflation resulted in a decline in sales of 3 per cent to €190 million.
 

Outlook

“Although the trading environment continues to be tough, our focus is on supporting our retail partners to deliver real consumer value and to provide a different and better shopping experience for consumers. Our business model is robust and having continued to reduce our debt and invest in infrastructure, we are confident in the long term future of the business. The plans we have in place will ensure Musgrave and our independent retailers emerge stronger from the recession with strengthened businesses and a platform for future growth.

For more information on the performance of our retail brands, check out our online annual review.

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