Musgrave Group, partner to entrepreneurial retailers across Ireland, the United Kingdom and Spain, today announces its results for the financial year ended 27th December 2014. The Group reported sales of €4.6 billion and operating profit before exceptional items of €66 million*. After exceptional costs of €70 million and property profits of €11 million, the loss for the year after tax is €13 million, compared to a loss of €113 million in 2013. Losses have reduced by €100 million in 2014 and a return to profit is expected in 2015. Cash was well managed, with net cash of €110 million at year end.
Commenting Chris Martin, Musgrave Group Chief Executive said:
“In 2014, the investments we have made in our brand development strategy delivered, with SuperValu becoming Ireland’s number one grocery retailer, Centra cementing its position as the country’s leading convenience brand and MarketPlace growing ahead of the market. As part of our Group transformation agenda, which is about positioning the business to deliver long-term sustainable growth, we announced our exit from Great Britain, combined our retail and wholesale businesses in Northern Ireland and integrated the former Superquinn business with SuperValu. With the transformation well progressed and given the strong position of our brands, the business is now on track to return to profit in 2015.”
Business Review
Musgrave is now the leading food retailer in Ireland. Through our retail brands SuperValu, Centra and Daybreak, and our wholesale brand Marketplace, Musgrave and its retailers employ over 30,000 people. Our strategy throughout the recessionary years was to invest significantly to build market leading brands that are now making good progress.
SuperValu recorded retail sales in line with last year of €2.6 billion and now serves over 2.6 million customers every week. SuperValu is differentiated through its food leadership programme and innovation agenda, commitment to local suppliers with initiatives like Food Academy and by delivering exceptional range and value through quality own brand products and promotions. The integration of Superquinn with SuperValu gave the brand the platform to become Ireland’s largest grocery retailer, securing 25% share of the grocery retail market.
Centra consolidated its position as the number one convenience retailer in the market with growth of 3% and now serves over 3 million customers a week. Centra has benefitted significantly from brand development work and investments that were made throughout the economic downturn. Sales growth was underpinned by investment in an own brand range of 1,300 Irish sourced products, the introduction of an all-day fresh food range and great value offers, all of which differentiated Centra with shoppers.
MarketPlace is now the number one partner to Ireland’s food service industry. The business had a very strong year, growing sales by 8%. The strong performance follows a focus on brand development work and investment in its offer to foodservice customers and non-affiliated retailers. The acquisition of Allied Foods, which was completed during the year, will support the growth of the business and strengthen its offer in Ireland’s foodservice sector, where it services more than 45,000 hotels, restaurants and hospitality businesses.
In Great Britain, since year end, we have reached agreement with Booker Group plc to sell our GB business. The sale is now subject to the approval of the UK Competition and Markets Authority.
In Northern Ireland, we reorganised our business bringing together our retail and wholesale operations. We are beginning to see the benefits of this new structure with our brands Centra, MarketPlace and SuperValu performing according to plan. We have opened new stake in the ground SuperValu stores in Crossgar and Fintona as we look to invest and develop our brands in the province.
In a tough market our business in Spain performed satisfactorily in 2014. Our brand work, investment and the development of concept stores, is laying the foundations for improved performance in a recovering Spanish economy.
Outlook
Trading conditions remain challenging in 2015 with the grocery market continuing to lag behind the general economic upturn. However with an ever improving Irish economy, we see opportunities for our brands as the grocery market returns to growth. The work that we have undertaken in reorganising the Group means that the business is now more efficient. As a result we are confident that the group is positioned to return to growth in 2015.
Profit and revenue is restated reflecting implementation of Financial Reporting Standard 102
For more information, click on www.musgravegroup.com
*Operating profit of €66 million before amortisation of intangible assets and exceptional items
