Booker’s acquisition of Makro is “on plan” to generate £26m of synergies by the end of the wholesaler’s financial year.
Releasing its half-year results this morning, the wholesaling giant, which was given the green light to acquire Makro in April this year, said the synergies would come from cost savings, goods not for resale, goods improvements, margin improvements on fresh products and from rent and rates savings.
It anticipates this will grow to £30m next year and £32m the following year.
Booker reported a 17% increase in pre-tax profits to £58.1m on sales up 16.5% to £2.2bn in the 24 weeks to 13 September. Like-for-like sales rose 2.3%, with non-tobacco sales up 5%. Tobacco sales fell 2.2%.
It also revealed that in the 21 weeks to 13 September, Makro contributed turnover of £268.5m and after synergies of £6m, pre-tax profits of £2.5m.
Like-for-like sales to caterers rose 8.7% to £712m during the half year, although like-for-like sales to retailers decreased 1.1% to £1.23bn “due to weak tobacco sales in part as a result of increasing competition from illicit tobacco trade”.
“Our plan to focus, drive and broaden Booker Group is on track,” said Booker CEO Charles Wilson.
“The team at Makro have settled into the group and are making a real contribution. Through working together Booker and Makro are improving the choice, price and service for our retail, catering and small business customers. Our customer satisfaction improved, which helped drive non-tobacco like for like sales up 5%,” he added.
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