Supermarket sales from sector’s top eight players raise concern

Supermarket sales may have been satisfactory in 2003, but financial results so far this year have raised investor concern after falling short of meeting first-quarter expectations. Although all of the larger supermarket chains saw improvement in profit and turnover levels, profitability rates remain exceptionally low as a percentage of sales. According to published financial statements, the total turnover of the eight largest in the field in 2003 reached 5.5 billion euros, or about 3.5 percent of the country’s annual economic output. Carrefour steadily holds on to the No. 1 position. In the period ending December 2003, the supermarket booked sales of 1.4 billion euros and tallied a 16.6-million-euro profit. Extraordinary gains of 30.2 million euros in the same period helped give profits a boost. In second place comes Alfa Beta Vassilopoulos, with profits of 12.2 million euros on turnover of 798 million. On a consolidated basis in 2003, the supermarket chain, which is also listed on the Athens bourse, reported sales of 901 million euros, up from 837.2 million in the same period a year earlier. The rise reflects the improved results of subsidiary Trofo supermarkets. Indicative of the sector trend this year, Vassilopoulos showed a 3 percent rise in sales growth during the year’s first quarter. At group level, losses were trimmed to 0.65 million euros from 1.53 million euros previously. The highest profits from the sector’s top players came from Sklavenitis, a supermarket which focuses on developing its network only in the Attica region. Profits in 2002 rose to 21.5 million euros from 18.8 million euros, while turnover increased to 764 million from 707 million in the previous year. Veropoulos, the only Greek supermarket chain which has risked expanding into the Balkans, showed profits of 1.9 million euros on sales of 536.6 million. In 2003, the group’s first financial reports which encompass recently acquired supermarket Panemporiki, Veropoulos profits came to 1.3 million euros. The profit figure is not directly comparable with the previous period due to the acquisition. Atlantik also showed steady growth. Sales in 2003 reached 523 million euros from 481 million, while profits hit 2.3 million euros versus 1.3 million in the same period a year earlier. News in the first quarter of 2004 is more encouraging for the sector. Consolidated sales rose 8.9 percent to 130.6 million euros from 119.9 million euros. The group’s net pretax profit gained 14.8 percent to 852,000 euros. Supermarket Metro, which will soon be renamed My Market from June 15, has maintained strong growth shown in the last few years. After showing annual profit growth above 57 percent in 2002, the supermarket’s continuing profitability was still evident, as sales rose to 422.5 million euros from 366.6 million euros. Company sources say its change of name will help open the road for the supermarket to expand its network outside of the Attica region. Northern Greece supermarket chain Diamantis Masoutis is gaining ground on its rivals. In 2003 profits were at 11.5 million euros, up from 8.7 million euros, while sales hit 290.2 million euros versus 271.9 million. Pente Sa recorded steady growth as profit rose to 16.5 million euros versus 14 million in 2002. At group level, profits hit 12.3 million euros against 9.3 million.