Electronics retailer Ceconomy, the parent company of MediaMarkt and Saturn, is optimistic now that sales have returned to above pre-pandemic levels, but it is selling its loss-making operations in Sweden.
Thanks to a 3.1 % rise in sales to almost 7.1 billion euros in the first quarter, Ceconomy’s sales are already back above pre-pandemic levels. The electronics retailer said it grew stronger than the market, but did see its gross margin fall due to higher costs and aggressive promotions.
Late last year, the company had warned of a pessimistic scenario in which the electronics industry might suffer if the macroeconomic situation deteriorated further. However, all indications now are that it will not come to that. For the current broken financial year 2022/23, Ceconomy therefore expects a slight increase in sales and a significant improvement in profits.
In a cost-saving move, the electronics giant has decided to sell its Swedish MediaMarkt operations to its competitor Power International AS, which also operates in Norway, Finland and Denmark. The deal involves 29 stores that employ 1,300 people and generate sales of 506 million euros.
MediaMarkt has been active in Sweden since 2006, but never got beyond fourth place in the electronics market there and continued to made a loss. Ceconomy will acquire 20 % of Swedish subsidiary Power Sweden in exchange for the sale of the chain.