Since the start of the year the supermarket sector has found itself in negative territory when compared with last year, both in turnover and in sales volume, as the wave of price hikes has suppressed consumption even of basic food commodities.
“I am not optimistic anymore about a reversal of the situation by the end of the year. We still have hikes ahead of us that have not yet trickled down to the shelf price,” Aristotelis Panteliadis, head of the Metro Group, told a press conference on Thursday.
The latest data show that since January the reduction in sales volume has amounted to almost 8%, therefore leading to a minor decline in turnover by about 1%-1.5%, despite the increase in prices.
At the same time the increase in energy and transport costs decreases any margin for absorption of a large part of the price hikes: “We cannot pass on the energy, transport and salary costs to retail prices; they are monitored by the authorities based on the regulations on profits margins,” explained Panteliadis.
He added that “hikes will obviously trickle down to consumers. They are usually passed on with a delay of two to three months from the time we receive the price lists from the suppliers, as we try to contain them through the purchase of large quantities.”
The head of the group that controls the Mymarket chain added that the regulation on profit margins that expires in June will be extended till the end of the year, which he also qualified as ”a wrong move,” saying that “when you lock profit margins, you prevent the market from operating.”
As for the profits of the Metro group, Panteliadis estimated they will match those of 2021 (23.5 million euros in pretax profits, down from €24.12 million in 2020), with most earnings stemming from the wholesale operations (the METRO Cash & Carry network); this is attributed to high expectations from the upcoming tourism season this year.
In sales terms, the Metro management anticipates an increase of 6% to €1.45 billion this year from €1.36 billion in 2021.