Finnish grocery retailer Kesko has announced a jump in pre-tax profits for the first half of 2016 to EUR103.8m (US$116m) over EUR68.5m in the same period last year.
Net sales also increased by 7.3% to EUR4.62bn compared to EUR4.3bn in the same period last year.
Kesco said operating profit also increased to EUR101.6m for the first half of the year compared to EUR72.2m in the first half of 2015.
Kesko said net sales for the next 12 months “are expected to exceed” levels of the past 12 months.
Kesko Group president and CEO Mikko Helander said: “Kesko is clearly Finland’s most internationalised trading sector company. The acquisition of Onninen will further strengthen our position in Finland and open up new, interesting opportunities for growth in the building and technical trade in Europe.”
Helander said: “The implementation of Kesko’s growth strategy progressed significantly during the second quarter, as the acquisition of Suomen Lahikauppa was completed in April and that of Onninen in June. With the acquisition of Suomen Lahikauppa, Kesko will grow in the neighbourhood retail market of the grocery trade and the neighbourhood retail services valued by Finnish consumers will improve significantly. The conversion of Suomen Lähikauppa’s Siwa and Valintatalo stores into K-Market stores began in May and will continue for about a year.”
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“Both acquisitions will provide significant economies of scale and synergies for Kesko,” Helander said.
“Thanks to the acquisitions, Kesko’s net sales for the second quarter increased by 17.2% and in local currencies, excluding the impact of acquisitions, by 4.6%. Both the comparable operating profit and the return on capital employed increased. In the grocery trade, profitability remained at a good level thanks to the enhancement actions taken. The completion of the acquisitions and the implementation of the strategy are expected to further improve Kesko’s growth and profitability.”