Picnic suffers major losses but keeps on course

On every euro of turnover, Dutch online supermarket Picnic loses almost 23 cents to high investments, recruitment and falling demand. The company sees no reason to change its course, however: rather, it is trying to accelerate further as growth goes before profit.

20% decline

Picnic’s net sales grew 27.7 % to 918.3 million euros last year, but losses almost doubled from 114.7 million in 2021 to 208.7 million in 2022. In Picnic’s annual report, Managing Director Michiel Muller attributes the losses to higher investments, FD reports.

. For instance, the online supermarket commissioned a new robotised distribution centre in Utrecht, costing twenty million euros. The company also hired 250 people at its headquarters in Amsterdam and added two extra floors there, at the cost of 25 million. Investment in expansion went up 30 million, while 25 million in losses was due to overcapacity as demand for home delivery of groceries fell by about a fifth after the pandemic.

Sufficient cash

While many e-commerce startups have shifted their focus from growth to profitability in a tougher financial climate, Picnic continues to invest heavily. “We are more likely to step on the gas further, rather than apply the brakes”, Muller clarified. On Wednesday, the online player opened a partially robotised distribution centre near Rotterdam and one will also be built in Oberhausen, Germany. The retailer wants to continue growing in France and Germany. Last year, it launched in major cities like Hamburg, Berlin and Paris.

Picnic has sufficient funds to carry those investments, the co-founder said. There is 375 million euros in cash in the books, while banks have provided 300 million in credit and a previous investment round raised another 37.5 million from shareholders. A new capital round is therefore not on the cards for now.