UK grocery retailer Somerfield has revealed weak trading over the Christmas period, but said it was pleased with its results for the first half.
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The company, which operates stores under the Kwik Save and Somerfield fascias, said operating profit before exceptional items for the interim period of 28 weeks ended 6 November 2004 was £32.7m (US$61.5m), compared to £17.2m in the year-ago period. Profit before tax and exceptional items was £27.9m, compared to £15.5m a year earlier.
First-half like-for-like sales edged up 0.9% for Somerfield, 0.1% for Kwik Save and 0.6% for the group. However, for the first ten weeks of the second half, including the important Christmas trading period, like-for-like sales were down 1.4% for the group. At the Somerfield fascia, like-for-like sales were down 1.2% for the ten weeks, while at Kwik Save like-for-like sales slid 1.6%.
“This is a good set of results for the first half. I am pleased that we achieved a significant increase in operating profit while accelerating our estate renewal programme,” said CEO Steve Back.
“We refitted more stores, converted 68 Kwik Save stores to the Somerfield fascia, developed the convenience business and closed underperforming sites. We are adding a significant amount of new retail space through the acquisition of 114 Safeway compact stores, 34 of these are now in our ownership and are already trading successfully. This activity is transforming our estate in line with our strategy, thereby equipping the group to meet the challenging conditions of an increasingly competitive marketplace,” he added.
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