Iceland Foods: slight dip in turnover in an ‘exceptionally challenging year’

Deeside headquartered Iceland Food report a 0.5 per cent drop in turnover for the 52 weeks to March 27.

Holding company Iceland Topco say like for like sales were down 4.4 percent to £2.697bn from £2.711bn – reflecting a reduction in ‘customer transactions, food price deflation and the cannibalisation effect of new store opening.’

The results come in what boss Malcolm Walker has described as an “exceptionally challenging year for the Group”

The UK food retailing industry as a whole has been hit by food price deflation, intense competition from the likes of Aldi and Lidl driving significant change in consumers’ shopping habits.

Highlights of the financial year for the company include, successful refinancing which was completed July 2014, the opening of 28 stores in UK and Ireland, roll out of the new Food Warehouse concept, online shopping service launched and achieved a highly acclaimed top 10 position in ‘Best Companies to Work For’ for the fifth year.

Mr Walker said:

“This has been an exceptionally challenging year for the Group, and for the UK food retailing industry as a whole.

In the face of food price deflation, intense competition and significant change in consumers’ shopping habits, Iceland has continued its long tradition of successful reinvention.

We have done this by developing a new store format, launching new product ranges, upgrading packaging, rethinking marketing and initiating a major productivity programme.

The benefits began to become evident in a more encouraging underlying sales and profit performance towards the end of 1 the year, which has put us in a stronger position to face the continuing competitive challenges in the year ahead.”

The company say the will continue to pursue a range of initiatives to make their stores, products and brand more appealing and to make frozen food more relevant to consumers.

The new “Power of Frozen” advertising campaign, launched initially through door drops, press and posters, moved onto national TV from May 2015 and will run
through the summer.

Iceland are looking to open up to 20 new stores in the UK and the Republic of Ireland this year while focusing on finding new sites for the expansion of The Food Warehouse concept.

The company say they remain confident the business will remain ‘highly cash generative’ with the capability to deliver long-term profitable growth.