Iceland Foods’ executive chairman Richard Walker claims the retailer’s financial health is “the best it’s ever been” after the supermarket posted strong annual results.
Last week the retailer presented its 2023 annual results to bondholders. The figures, which were leaked to The Times over the weekend, showed Iceland’s underlying profit grew to £315.7m in the year to 29 March, a 24% increase. Sales were up 6.6% to £4.3bn across Iceland and Food Warehouse stores.
Iceland has a long-term policy of not commenting on its results, however the business confirmed the figures are correct.
It marks a welcome return to the black for the family-owned group, after a difficult couple of years during which it struggled with surging energy costs in the wake of Russia’s invasion of Ukraine in February 2022.
Concerns over its mounting bond debt led at least three credit insurance providers to suspend cover for some of the supermarket’s suppliers in February 2023.
At the time Iceland maintained it was “incredibly well positioned” and has since worked to resecure long-term energy deals for its stores. It’s also a significant way through a programme to upgrade chillers into more energy-efficient freezers across its estate.
Despite the improved performance, Iceland’s debt leverage remained relatively high at 4.3X, The Times reported.
“The last two years have been challenging to say the least, with a maelstrom of inflationary cost pressures. But thanks to everyone’s brilliant efforts, Iceland has come through stronger and better,” Walker said in a LinkedIn post responding to the reports.
“Not only is our financial health the best it’s ever been – we also have a proposition that resonates with the Great British public more than ever.”
In response to the cost of living crisis, Iceland has heavily ramped up its budget £1 or Less range, and introduced new tiers and multibuy offers in order to remain competitive.
It’s also broadened its offer, with the expansion of its exclusive brands programme, as well as the relaunch of its entire fresh range and a new own-label home range.
Walker also shared a screenshot via X of Iceland’s internal data from Kantar’s latest market share report, which showed its volumes grew 7.9% during the 12 weeks to 7 July. Kantar does not freely share volume sales.
Latest Kantar figures for the 12 weeks to 7th July 👀
— Richard Walker (@icelandrichard) July 26, 2024
…testament to the fabulous work by all at Team Iceland 🙏🏻💪🏻💫 pic.twitter.com/RASSGFsDnz
Iceland’s sales value rose 4.1% during the period according to Kantar’s figures.
Having initially halted its store rollout plans in 2022 while it dealt with energy costs, The Grocer revealed last month the retailer has kicked off a new property expansion plan. It’s aiming to double the number of Food Warehouse stores around the UK.
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