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Increased competition in the Belgian food market continues to worry Colruyt Group, with the Belgian retailer seeing revenue decreasing and costs rising. Its market share is under pressure, despite the acquisition of Match and Smatch.
Poor weather conditions
Colruyt Group’s Belgian market share has dropped from 31.6 % last year to 31.2 % now (as total of food chains Colruyt, Okay, Spar and Comarkt). Food sales did increase by 0.7 % to 5.2 billion euros in the first half of the broken financial year, thanks to the integration of the acquired Match and Smatch stores, which now carry the CoMarkt/CoMarché banner: without these stores, sales fell by 1.8 %.
The eponymous Colruyt chain lost 1.9 % in sales, Okay, Bio-Planet and Cru rose 1 %. Colruyt Group cites poor weather conditions, strong competition and an increased number of competitor’s independent stores that are, unlike its own, open on Sundays. There was a strong increase for wholesale sales: this is partly explained by the fact that several independent Match and Smatch entrepreneurs switched to Spar. Also noteworthy is the growth of foodservice division Solucious: + 19.4 %.
Growth in fitness
In non-food, Colruyt Group’s Bike Republic saw its sales drop 8.9 % in a bicycle market that is under heavy pressure. Its fashion division The Fashion Society (Zeb, PointCarré and The Fashion Store) reported stable to slightly rising comparable revenue, while Newpharma grew 20 % (in comparable revenue growth) and fitness chain Jims grew 14.9 %. The latter has announced it will double its Belgian presence by acquiring its competitor NRG, which owns forty fitness clubs.
Group sales fell 0.5 % to 5.4 billion euros. Due to higher costs – including wages – operating cash flow fell 2.6 % to 444 million euros and operating profit 4.8 % to 245 million euros.
