Makro stops turnover decrease, but remains at a loss

Makro‘s Belgian cash & carry stores have been able to ‘almost’ stabilise their turnover in the past financial year, after figures had been falling by 10 % and more for many years. However, a break-even is not yet in sight for the Metro subsidiary.

A more efficient organisation

According to CEO Vincent Nolf, there has been a turnaround on the Belgian market: in the last financial year turnover remained almost stable, he tells Belgian business newspaper De Tijd. The recovery is the result of a 20 % growth in marketing investments, with the chain placing a greater emphasis on the sale of large packages and on specific target groups, such as hobby chefs. The road to achieving a break-even is still long, but the fact that the German parent company is once again providing 25 million euros to compensate the losses, is a sign of confidence, Nolf says.

The CEO now wants to continue working on creating a more efficient organisation to improve profitability. There is no talk of restructuring and all six stores remain open, although the number of overtime hours is to be limited and temporary contracts could be terminated. Wholesaler Metro, Makro’s sister company, is doing better: turnover is increasing and they have enjoyed a positive gross operating profit. 

The retailer has not yet provided figures for the financial year that has just ended. Last financial year (ending in September 2018), Makro Cash & Carry’s Belgian turnover fell by 13 % to 735 million euros. Net losses rose to 63 million euros. At the beginning of this year, owner Metro already put 40 million euros in the ailing chain: in total, the holding company has already injected 340 million euros since 2015. CEO Olaf Koch then said that the patience of the shareholders was almost at an end and that a sale of the cash & carry stores could not be ruled out.