FULLTEXT DEL 1 AV 1
Kvartalsrapport Q1 2023
===== SIDA 1 =====
Interim report
1 January–31 March 2023 Q1
Increased market share and high inflow of new customers
First quarter summary
• Net sales totalled SEK 19,252 m (16,593),
an increase of 16.0%.
• Retail sales totalled SEK 15,225 m (12,711),
an increase of 19.8%.
• Operating profit amounted to SEK
695 m (835) including items affecting
comparability of SEK -55 m (182).
The operating margin was 3.6% (5.0).
• Adjusted operating profit amounted to
SEK 750 m (653), an increase of 14.9%.
The adjusted operating margin was
3.9% (3.9).
• Net profit for the period amounted to
SEK 472 m (682) and earnings per share
before dilution to SEK 2.20 (3.27).
• Axfood’s holding in Mathem was revalued
from SEK 206 m to SEK 34 m. The
revaluation represented an adjustment of
the valuation of the Company established
in connection with the new share issue to
be carried out in the second quarter.
• The Annual General Meeting (AGM)
on 22 March approved a dividend to
shareholders of SEK 8.15 (7.75) per share.
The dividend amount is divided into two
payments. The first payment of SEK 4.15
was made in March, and the second
payment of SEK 4.00 will be made in
September. Axfood’s Board of Directors
also resolved on the repurchase of no
more than 330,000 shares related to the
long-term share-based incentive
programme LTIP 2023.
Key ratios Q1
2023
Q1
2022 Change R12
Full-year
2022
Net sales, SEK m 19,252 16,593 16.0% 76,134 73,474
Retail sales, SEK m 15,225 12,711 19.8% 58,235 55,721
Operating profit, SEK m 695 835 -16.7% 2,961 3,101
Operating profit excl. items affecting comparability, SEK m 1) 750 653 14.9% 3,326 3,229
Operating margin, % 3.6 5.0 -1.4 3.9 4.2
Operating margin excl. items affecting comparability, % 1) 3.9 3.9 0.0 4.4 4.4
Net profit for the period, SEK m 472 682 -30.8% 2,160 2,370
Earnings per share before dilution, SEK 2) 2.20 3.27 -32.7% 9.99 11.04
Earnings per share before dilution excl. items affecting comparability, SEK 1, 2) 2.40 2.43 -1.1% 11.34 11.36
Cash flow from operating activities, SEK m 481 1,429 -66.3% 4,979 5,927
Return on capital employed R12, % 20.3 26.5 -6.2 20.3 20.9
Sustainability-labelled products, share of sales, % 27.0 28.5 -1.5 26.3 26.6
1) See Note 9 Items affecting comparability for more information.
2) Comparison figures were revalued for the bonus issue element of the rights issue that was completed in the second quarter of 2022.
For further information, please contact:
Alexander Bergendorf, Head of Investor Relations, tel. +46 73 049 18 44
The information herein is such that Axfood AB (publ) is required to make public in accordance with the EU Market Abuse Regulation .
The information was submitted for publication, through the agency of the contact person listed above, at 7:00 a.m. CET on 26 April 2023.
This interim report is an English translation of the Swedish original. In the event of any discrepancies, the Swedish version shall govern .
16.0%
Net sales growth
for the Axfood Group
during the first quarter
19.8%
The Axfood Group’s
growth in retail sales
during the first quarter
===== SIDA 2 =====
Axfood interim report 1 January–31 March 2023 | 2
CEO message
In a challenging time for households, it is clear that growing numbers of consumers are choosing to shop
with us, particularly with Willys, whose ambition is to offer Sweden’s cheapest bag of groceries. This
enabled Axfood to further strengthen its position during the first quarter of the year and to grow more
than twice as much as the market. During the quarter, we continued to invest in our offering and made
major strides in our long-term focus on logistics, which will ultimately allow us to become more
competitive.
Like in the rest of Europe, food price inflation in Sweden
remained very high during the first quarter. As a result of
external factors such as the effects of the pandemic,
climate change and the war in Ukraine, the entire food
supply chain has faced enormous cost increases over the
past year. In Sweden, we have been hit particularly hard
due to a weaker Swedish krona.
Higher costs for food, along with higher costs for
electricity and fuel, for example, and rising interest rates,
have created a challenging scenario for many households.
Our focus is on protecting consumer interests. We are
working hard to mitigate the cost pressure arising earlier
in the food supply chain, and the prices on our store
shelves do still not reflect the price increases we have
received from our suppliers. In positive news, we have seen
prices of certain raw materials declining for some time
and the pressure faced by many of our suppliers has begun
to ease. We are now working intensively together with our
suppliers to ensure this is also reflected in our prices to
consumers, which we have already started to see in
certain categories, such as dairy, bread, and fruit and
vegetables. Although many factors could still impact the
situation, these are still positive signals. Our hope is that
food price inflation has now peaked.
Strong growth mainly driven by Willys
The fact that consumers are choosing to purchase
affordable, good and sustainable food from our store
concepts in these challenging times is clear proof that
they appreciate what we do. We grew significantly more
than the market during the quarter, both in stores and
online. Axfood’s growth was approximately 20%, more
than double that of the market.
Once again, Willys was the main contributor to this
strong trend. Willys grew by a full 24%, as a result of a
growing numbers of consumers coming to appreciate the
chain’s offering over the past year. With various types of
loyalty-promoting activities, Willys is establishing a
position as the preferred choice of food store for an
increasingly broad consumer base and has been the most
recommended chain in the Swedish food retail market for
three years.
Our cross-border grocery chain Eurocash delivered a
strong quarter as it remains significantly cheaper to shop
for food in Sweden than in Norway. However, we are now
facing more challenging comparison figures than in the
past since the pandemic restrictions were lifted in early
February last year.
Hemköp once again displayed favourable growth,
slightly stronger than that of the market, and continued to
gain market share in the traditional grocery segment. The
investments in concept development and extensive store
modernisations are generating results. Hemköp is also
attracting more price-conscious consumers, for example
through its “Alltid bra pris” (Always a good price) marketing
campaign, and these consumers also appreciate Hemköp’s
inspirational offering, from its organic range to its meal
solutions.
Snabbgross delivered a strong start to the year and is
continuing to make progress with the Snabbgross Club
member concept. However, a weaker restaurant market
resulted in a certain decline in the volume trend,
particularly towards the end of the quarter.
High customer traffic contributes to increased profit
The high level of customer traffic also contributed to a
positive earnings trend in the first quarter. This enabled us
to deliver an operating margin for the quarter that was in
line with the same quarter last year.
However, earnings were negatively impacted by the
fact that we have not fully passed on our suppliers’ price
increases to consumers. Compared with the year-earlier
period, we also had higher market investments in both
our store chains and Dagab, which resulted in a higher
share of campaigns. Higher rental and electricity costs in
own operations also had a negative impact on earnings.
Focus on increased efficiency and reducing costs
In parallel with managing the prevailing food price
inflation and changing customer behaviour, we are
continuing the work to be more efficient and reduce our
costs. To this end, we are carrying out the largest logistics
investments in the history of our Group. With these
investments, we are improving the competitiveness of our
“We grew more than twice as much as the market,
which is clear proof that what we do and offer is
appreciated by our customers.“
Significant events during the first quarter
• Growth that was more than double that of
the market resulted in a higher market share
• High inflow of new customers
• First deliveries from the new, highly automated
logistics centre in Bålsta outside Stockholm
===== SIDA 3 =====
Axfood interim report 1 January–31 March 2023 | 3
own concepts and our wholesale customers and will be
able to offer a more comprehensive and affordable
assortment, with further optimised deliveries of goods
to stores and e-commerce customers.
In early February, the first store deliveries of the
dry food range were carried out from the new, highly
automated logistics centre in Bålsta outside
Stockholm. This was a fantastic achievement considering
the complexity of this project and at a time when the
global situation was unpredictable and challenging, to put
it mildly. At the time of writing, over 170 stores are
receiving daily deliveries of a total of approximately 2,800
pallets of goods from Bålsta. The deployment of the new
logistics centre is a work in progress that will continue
throughout 2023 and into 2024, with the addition of
deliveries from the refrigerated and frozen range and a
gradual increase in the number of stores and e-commerce
customers receiving deliveries from Bålsta.
Continued sustainability efforts
We maintain a consistently high pace in our sustainability
work. In addition to our daily operational sustainability
efforts, which encompass a number of areas, we focused
on strengthening our organisation and governance during
the quarter and established a biodiversity strategy.
We aspire to take the lead in promoting a sustainable
food system, but I am concerned about the negative trend
we are continuing to see when it comes to sustainability-
labelled food, a trend that goes hand in hand with
consumers’ increased price consciousness. To be able to
reverse this trend in the long term, we are continuing to
develop and broaden the assortment, but we also believe
it is important that political decision-makers look at the
possibility of reducing or eliminating the VAT on
sustainability-labelled food in accordance with the
proposal we presented last year. We recently carried out a
survey that shows that Swedish consumers have
responded positively to the proposal and would purchase
more sustainable products if it were implemented.
Strong and relevant concepts
Food has probably never attracted as much attention as
it is attracting right now, which we have much
understanding for. As a food retailer, it is therefore more
important than ever before that we are able to ensure a
relevant and competitive offering.
With our various concepts, we once again succeeded
in gaining market share and attracting even more
customers during the quarter. It is our outstanding
employees who make this possible, every day, which I am
incredibly thankful for. The power and agility we have
developed in recent years are competitive advantages.
They allow us to create value for all our stakeholders, to
maintain a strong financial position and to continue
investing to be the leader in affordable, good and
sustainable food.
Klas Balkow
President and CEO, Axfood AB
Presentation of the interim report
for the first quarter of 2023
Axfood will present the interim report for the first
quarter of 2023 in a webcast at 9:30 a.m. CET today,
Wednesday, 26 April 2023. The report will be presented
by Klas Balkow, President and CEO, and Anders
Lexmon, CFO.
A link to the webcast is available at axfood.com.
A link to register to participate via conference call
is also available at axfood.com. Upon registration,
a telephone number and conference ID for the
conference call will be provided.
Financial calendar
• The interim report for the second quarter
of 2023 will be published at 7:00 a.m. CET
on 14 July 2023
• The interim report for the third quarter
of 2023 will be published at 7:00 a.m. CET
on 25 October 2023
• The year-end report for 2023 will be published
at 7:00 a.m. CET on 1 February 2024
Selection of press releases from Axfood
during the first quarter of 2023
6 February 2023
Tempo launches hybrid solution for unstaffed opening
hours
24 February 2023
Axfood publishes Annual and Sustainability Report
2022
22 March 2023
Resolutions at Axfood’s 2023 Annual General Meeting
===== SIDA 4 =====
Axfood interim report 1 January–31 March 2023 | 4
The Swedish food retail market
According to the Swedish Food Retail Index, total sales
growth during the first quarter of 2023 amounted to 9.2%.
The calendar effect during the quarter is estimated at 0.5
of a percentage point. Sales in physical stores increased
by 10.7%. E-commerce sales declined by 14.4%. Share of
food retail sales from e-commerce amounted to 4.7%
during the quarter.
Food price inflation
During the first quarter of 2023, food prices increased by
20.1% compared to the prior year period, according to
Statistics Sweden. Inflation was broad and covered all
product categories, but most notable was the price
increases in the categories of dairy, oils and fats, and fish.
Higher fuel and electricity prices are examples of
underlying causes of inflation.
Growth in Axfood’s retail sales1) compared with the Swedish Food Retail Index
1) Includes retail sales growth in the Tempo concept as of the first quarter of 2022. Comparison figures are not restated.
Growth in Axfood’s online sales1) compared with the Swedish Food Retail Index
1) Mat.se is included in the sales figures until February 2022.
-4,6%
-14,4%
-40%
0%
40%
80%
120%
160%
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Axfood online sales Retail trade index online SvDH/HUI
19,8%
9,2%
0%
4%
8%
12%
16%
20%
Q1
2020
Q2
2020
Q3
2020
Q4
2020
Q1
2021
Q2
2021
Q3
2021
Q4
2021
Q1
2022
Q2
2022
Q3
2022
Q4
2022
Q1
2023
Axfood retail sales Retail trade index SvDH/HUI
===== SIDA 5 =====
Axfood interim report 1 January–31 March 2023 | 5
Group performance
Net sales
First quarter
Net sales totalled SEK 19,252 m (16,593),
an increase of 16.0%. This increase is
attributable to high food price inflation and
an increase in new customers.
Retail sales totalled SEK 15,225 m (12,711),
an increase of 19.8%, which was significantly
higher than the market’s growth of 9.2%. Like-
for-like sales growth was 17.5%, primarily
driven by Willys’ strong performance, but also
good growth for Hemköp relative to the
market.
Online sales totalled SEK 880 m (925),
a decline of 4.6%, mainly as a result of the
divestment of Mat.se on 1 March last year.
Excluding Mat.se, sales increased by 2.0%.
The share of retail sales attributable to
e-commerce was 5.8% (7.3), which was
higher than the market.
The share of retail sales attributable to
private label products was 33.1% (31.5).
Read about the performance of the Willys, Hemköp,
Snabbgross and Dagab operating segments on pages 9 -12.
Net sales per segment
SEK m
Q1
2023
Q1
2022 Change
R12
Full-year
2022
Willys 10,465 8,418 24.3% 39,498 37,451
Hemköp 1,818 1,589 14.4% 6,878 6,650
Snabbgross 1,147 934 22.7% 4,939 4,727
Dagab 17,753 15,062 17.9% 69,690 66,999
Joint-Group 331 281 17.9% 1,285 1,234
Internal sales between segments
Dagab -11,977 -9,431 27.0% -45,036 -42,490
Joint-Group/other -283 -259 9.0% -1,120 - 1,097
Total 19,252 16,593 16.0% 76,134 73,474
Retail sales
SEK m
Q1
2023
Q1
2022 Change
Change
like-for-like
stores
R12
Full-year
2022
Willys 10,467 8,420 24.3% 21.5% 39,505 37,458
Hemköp1) 4,758 4,291 10.9% 9.4% 18,730 18,263
Total 15,225 12,711 19.8% 17.5% 58,235 55,721
1) Refers to Hemköp (Group-owned and retailer-owned) and Tempo.
16.0%
Net sales growth
for the Axfood Group
during the first quarter
19.8%
The Axfood Group’s
growth in retail sales
during the first quarter
Net sales and growth
===== SIDA 6 =====
Axfood interim report 1 January–31 March 2023 | 6
Operating profit
First quarter
Operating profit amounted to SEK 695 m
(835), a decrease of 16.7%. Operating profit
includes items affecting comparability
totalling SEK -55 m (182), which entirely
pertained to parallel warehouse operations
during the transition to the new logistics
centre in Bålsta. In the year-earlier period,
items affecting comparability included
integration costs of SEK -33 m for
Bergendahls Food, structural costs of SEK
-6 m pertaining to the logistics operations,
and a capital gain of SEK 221 m for the sale of
Mat.se. The operating margin was 3.6% (5.0).
Operating profit excluding items
affecting comparability amounted to SEK
750 m (653), an increase of 14.9%. The
increase was mainly the result of strong
growth and effective cost control. Overall, this
compensated for lower gross margins in the
segments and higher market investments.
Operating profit was also negatively
impacted by higher costs for rent and
electricity. The operating margin excluding
items affecting comparability was 3.9% (3.9).
Net financial items for the period
amounted to SEK -80 m (-41), a change mainly
attributable to higher interest expenses
related to increased lease liabilities and
higher interest compared with the year-earlier
period. Profit after financial items amounted
to SEK 615 m (794) and profit after tax to SEK
472 m (682).
Read about the performance of the Willys, Hemköp,
Snabbgross and Dagab operating segments on pages 9 -12.
Operating profit per segment excluding items affecting comparability
SEK m
Q1
2023
Q1
2022 Change
R12
Full-year
2022
Willys 454 367 23.7% 1,946 1,859
Hemköp 71 66 7.4% 288 283
Snabbgross 30 30 -0.7% 252 252
Dagab 261 247 5.9% 1,154 1,139
Joint-Group -67 -58 15.7% -312 -303
Operating profit excl. items affecting comparability 750 653 14.9% 3,326 3,229
Items affecting comparability 1) -55 182 -365 -129
Operating profit 695 835 -16.7% 2,961 3,101
Net financial items -80 -41 -205 -166
Profit after financial items 615 794 -22.5% 2,756 2,935
1) See Note 9 Items affecting comparability for more information.
Operating margin per segment excluding items affecting comparability
%
Q1
2023
Q1
2022 Change R12
Full-year
2022
Willys 4.3 4.4 -0.0 4.9 5.0
Hemköp 3.9 4.2 -0.3 4.2 4.3
Snabbgross 2.6 3.2 -0.6 5.1 5.3
Dagab 1.5 1.6 -0.2 1.7 1.7
Operating margin excl. items affecting comparability 3.9 3.9 0.0 4.4 4.4
Operating margin 3.6 5.0 -1.4 3.9 4.2
Operating profit and
operating margin excl.
items affecting
comparability
===== SIDA 7 =====
Axfood interim report 1 January–31 March 2023 | 7
Capital expenditures
Total capital expenditures in intangible assets
and property, plant and equipment during the
quarter amounted to SEK 551 m (531). Of
these capital expenditures, SEK 197 m (341)
pertained to investments in wholesale
operations, of which SEK 124 m (203) related
to investments in automation solutions.
The year-earlier period also included an
investment in land amounting to SEK 79 m.
Investments in the retail operations amounted
to SEK 225 m (99), and joint-Group and IT
investments amounted to SEK 128 m (91).
Investments in right-of-use assets, mainly
premises, amounted to SEK 866 m (605)
during the quarter, of which SEK 167 m (130)
pertained to newly acquired assets and SEK
699 m (475) pertained to revaluations of
existing leases, primarily due to upward
indexation. Of the total investments in leases,
SEK 147 m (80) pertained to wholesale
operations, SEK 714 m (521) pertained to retail
operations and SEK 5 m (3) pertained to joint-
Group operations.
Financial position and cash flow
Cash flow from operating activities amounted
to SEK 481 m (1,429) during the first quarter.
The decrease was mainly due to changes in
working capital as a result of a build-up of
inventory ahead of Easter and the transition
to the new logistics centre in Bålsta. Paid tax
totalled SEK -233 m (-213).
Net capital expenditures had an impact of
SEK -644 m (-581) on cash flow. Cash and
cash equivalents held by the Group amounted
to SEK 311 m, compared with SEK 559 m at
31 December 2022.
Interest-bearing liabilities and provisions
totalled SEK 11,201 m, compared with SEK
9,542 m at 31 December 2022.
Interest-bearing net debt amounted to
SEK 10,889 m at the end of the period,
compared with SEK 8,982 m at 31 December
2022, which is primarily attributable to loans
raised and increased lease liabilities.
The equity ratio was 18.1%, compared
with 24.1% at 31 December 2022 and 17.6%
at 31 March 2022.
Net debt/EBITDA was 1.9, compared with
1.6 at 31 December 2022. Net debt/EBITDA
excluding IFRS 16 was 0.4, compared with
0.0 at 31 December 2022.
Derivation of total investments and net capital expenditures in cash flow
SEK m Q1 2023 Q1 2022
Total capital expenditures -1,417 -1,135
Investments in leases 866 605
Divestment of property, plant and equipment/intangible assets 0 1
Acquisitions of financial assets -103 -12
Acquisitions of operations – 12
Divested operations – -51
Dividends from joint ventures and associated companies 10 –
Cash flow from investing activities -644 -581
Parent Company
The Parent Company’s net sales and other
operating income amounted to SEK 96 m (75)
for the first quarter. After operating expenses
of SEK -132 m (-108) and net financial items of
SEK 2 m (1), the Parent Company reported a
loss after financial items of SEK -34 m (-32).
Investments during the period was SEK 1 m (1).
The Parent Company had an interest-bearing
net receivable of SEK 2,595 m at the end of
the quarter, compared with SEK 1,449 m at
31 December 2022. The Parent Company has
no significant transactions with related
parties, other than transactions with
subsidiaries.
Capital expenditures
and depreciation/
amortisation
Net debt/EBITDA
===== SIDA 8 =====
Axfood interim report 1 January–31 March 2023 | 8
Sustainable development
For Axfood, sustainable development is about seeing the
whole picture and the relentless pursuit of improvements.
Sustainability permeates all operations and encompasses
the entire food system, taking into account the environ-
ment, animal welfare, and the people who produce, sell
and consume food. Axfood will take the lead in promoting
a sustainable food system by influencing decisionmakers,
leading the way through its own initiatives and driving
industry issues.
The foundation of Axfood’s efforts is a sustainability
programme designed to strengthen its operations while
contributing to the UN SDGs and Sweden’s Environmental
Objectives. The sustainability programme is an important
governance instrument that includes a sustainability
policy and some 40 targets.
To remain at the forefront of sustainability, it is
important to encourage engagement. During the quarter,
Axfood organised a “Sustainability Week” during which the
Group’s various initiatives in the area were highlighted.
Leadership within the Group also received recognition
during the quarter when Axfood’s Head of Sustainability
Åsa Domeij was named “Sustainability Manager of the
Year for 2022” by the publication Aktuell Hållbarhet.
Food
Axfood strives to make it easier for consumers to make
sustainable choices through a broad assortment of
sustainability-labelled products.
During the first quarter, the share of sales attributable
to sustainability-labelled products declined to 27.0%
(28.5) and the share of sales attributable to organic
products declined to 4.8% (5.8). These changes were the
result of the current food price inflation, which is a
disadvantage for products that are priced slightly higher.
Moreover, the sales trend for organic products has been in
decline for the industry as a whole for some time. The
share of KRAV-certified meat declined to 2.6% (3.3), and
the growth rate for vegetarian protein substitutes was
5.6% (-2.0).
Axfood is working to cut food waste in half by 2025
compared with the base year of 2015, an initiative that is
mainly being driven by in-store clearances, improved
routines and partnerships with charity organisations.
During the quarter, Willys and Hemköp stores sold
approximately 550 tonnes of fruits and vegetables at
reduced prices to avoid waste. To increase awareness
about food waste, Willys also conducted a major
campaign featuring a “Leftover Rescue Service” that
helped consumers use up their leftover food instead of
throwing it away.
Environment
Axfood is striving to reduce the climate impact of food
production as far as possible. The Group’s climate targets
encompass both its own and suppliers’ operations as well
as reducing the climate impact per kilo of food sold.
A biodiversity strategy has been established including
areas such as purchasing and sales, food waste, store
establishments and having a positive social impact. It
summarises the Company’s view on biodiversity, describes
the work today and provides guidelines for future work.
The CO2 effect per tonne of delivered goods for the
Group’s own transports was 14.9 CO2e (14.2) during the
quarter. Axfood is continuing its transition efforts in order
to reduce the climate impact from transports, and 12 new
biogas vehicles were deployed during the quarter.
Energy intensity declined to 225.1 kWh per square
metre. As of the first quarter, more warehouses are
included in the calculation since they are now part of
Axfood’s central power purchase agreement. Comparison
figures have not been restated. The new logistics centre in
Bålsta is now also included, and its energy intensity is
expected to increase as it is gradually being automated.
Axfood is working to make its operations more circular.
At the new fruit and vegetable warehouse in Landskrona,
all 1.4 million wooden pallets have been replaced with
reusable pallets that are part of a circular system. This will
reduce emissions by at least 100 tonnes CO2e per year.
People
Axfood aspires to be a positive force in society and is
working to improve work and social conditions throughout
the food supply chain, including customers and agricultural
and production workers as well as its own employees.
Social audits are conducted in all risk countries in order
to ensure compliance with Axfood’s Code of Conduct
among suppliers of private label products. All of the audits
during the quarter, a total of 18 (14), were carried out in
China and showed acceptable or positive results.
The share of women in management positions was
50.8% (48.9), in line with the Group’s long-term target. The
definition of the key ratio has been revised to also include
team managers in stores.
A prioritised area involves reducing sickness-related
absence among employees. Sickness-related absence
during the first quarter was 7.2% (9.4). The level in the
year-earlier period was high, mainly due to the easing of
pandemic restrictions and a high rate of infection.
For more information on Axfood’s sustainability work and key ratios,
see the website and the 2022 Annual and Sustainability Report.
Sustainability key ratios
Q1
2023
Q1
2022 Change
R12
Full-year
2022
Sustainability-labelled products, share of sales, % 27.0 28.5 -1.5 26.3 26.6
Organic products, share of sales, % 4.8 5.8 -1.0 4.8 5.1
KRAV-certified meat, share of sales, % 2.6 3.3 -0.7 2.6 2.7
Growth in vegetarian protein substitutes, % 5.6 -2.0 7.6 3.7 1.7
Share of approved social audits, % 100.0 100.0 0.0 96.9 96.8
Electricity consumption, kWh/m 2 (stores and warehouses) – – – 225.1 276.2
CO2e, kg/tonne of goods 14.9 14.2 0.7 13.6 13.6
Share of women in management positions, % 50.8 48.9 1.9 – 50.7
Sickness-related absence, % 7.2 9.4 -2.2 6.5 7.0
===== SIDA 9 =====
Axfood interim report 1 January–31 March 2023 | 9
Operating segment performance
Willys
First quarter
Net sales totalled SEK 10,465 m (8,418), an
increase of 24.3%.
Growth in retail sales amounted to 24.3%,
which was more than double as much as the
market. Growth in like-for-like sales
amounted to 21.5%. As food price inflation has
been increasing, value for money is becoming
increasingly relevant to consumers, which is
benefiting Willys as Sweden’s leading
discount player. The Willys chain’s strong
development was attributable to pricing and
volume growth from increased in-store
customer traffic. The positive trend in cross-
border shopping continued, and Eurocash’s
sales increased considerably compared with
the first quarter of the preceding year, which
was partly negatively affected by pandemic-
related restrictions.
The number of stores in the segment
amounted to 236 (227), of which 176 (169)
were Willys stores, 53 (51) were Willys Hemma
stores and 7 (7) were Eurocash stores. The
e-commerce rollout continued, and at the
end of the quarter online shopping was
offered in 151 (129) stores.
Operating profit increased significantly
and amounted to SEK 454 m (367),
corresponding to an operating margin of 4.3%
(4.4). Continued price increases by suppliers
were not fully reflected in prices for
consumers, which had a negative effect on
the gross margin. Operating profit was also
negatively impacted by increased market
investments, which resulted in a higher share
of campaigns, as well as higher costs for
premises related to rent and electricity. The
effects of this on profit were offset by the
growth in like-for-like sales.
Willys key ratios
Q1
2023
Q1
2022 Change R12
Full-year
2022
Net sales, SEK m 10,465 8,418 24.3% 39,498 37,451
Operating profit, SEK m 454 367 23.7% 1,946 1,859
Operating margin, % 4.3 4.4 0.0 4.9 5.0
Retail sales, SEK m 10,467 8,420 24.3% 39,505 37,458
Like-for-like sales growth, % 21.5 4.1 17.4 – 13.5
Number of stores 236 227 9 – 232
of which, Willys 176 169 7 – 173
of which, Willys Hemma 53 51 2 – 52
of which, Eurocash 7 7 0 – 7
Stores offering online shopping 151 129 22 – 149
Private label products, share of sales, % 34.8 33.2 1.6 – 33.1
Sustainability-labelled products, share of sales, % 28.5 30.3 -1.8 27.9 27.4
Average number of employees 6,555 6,267 288 – 6,669
Share of women in management positions, % 1) 60.1 59.7 0.5 – 60.6
Sickness-related absence, % 7.1 9.4 -2.2 6.3 6.8
1) The definition of “Share of women in management positions” has been revised to also include team managers. Comparison figures have been restated.
With the business concept of
offering Sweden’s cheapest
bag of groceries, Willys is the
country’s leading discount
grocery chain, offering a broad
assortment both in Group-
owned stores and online.
The Willys operating segment
includes the concepts Willys,
Willys Hemma, the partly
owned cross-border grocery
chain Eurocash and a minority
stake in the City Gross
hypermarket chain.
Net sales and
operating margin
===== SIDA 10 =====
Axfood interim report 1 January–31 March 2023 | 10
Hemköp
First quarter
Net sales (including franchise fees) amounted
to SEK 1,818 m (1,589), an increase of 14.4%.
Growth in retail sales (including Tempo)
amounted to 10.9%, which is slightly more
than the market and higher than the rate of
growth in the traditional grocery segment.
Growth in like-for-like sales amounted to
9.4%. Hemköp continuously develops its
concept, strengthens its sustainability profile
and invests in an increased presence and
modernisations of existing stores. The
development in larger stores in central urban
locations was more favourable than the
development in stores in residential areas and
the Tempo chain.
The number of stores amounted to 332 (329),
of which 65 (64) were Group-owned Hemköp
stores, 136 (135) were retailer-owned Hemköp
stores and 131 (130) were retailer-owned
Tempo stores. At the end of the quarter, online
shopping was offered in 68 (72) stores.
Operating profit totalled SEK 71 m (66),
corresponding to an operating margin of 3.9%
(4.2). Continued price increases by suppliers
were not fully reflected in prices for
consumers, which had a negative effect on
the gross margin. Operating profit was also
negatively impacted by a higher share of
campaigns and increased costs for premises
related to rent and electricity. During the
quarter, Hemköp intensified the “Alltid bra
pris” (Always a good price) marketing
campaign, which had a negative impact on
the gross margin. The overall negative impact
on profit was offset by the growth in like-for-
like sales.
Hemköp key ratios
Q1
2023
Q1
2022 Change R12
Full-year
2022
Net sales, SEK m 1,818 1,589 14.4% 6,878 6,650
Operating profit, SEK m 71 66 7.4% 288 283
Operating margin, % 3.9 4.2 -0.3 4.2 4.3
Retail sales, SEK m 4,758 4,291 10.9% 18,730 18,263
Like-for-like sales growth, % 9.4 1.3 8.1 – 4.5
Number of stores 332 329 3 – 332
of which, Group-owned Hemköp/Tempo stores 65 64 1 – 64
of which, retailer-owned Hemköp stores 136 135 1 – 137
of which, retailer-owned Tempo stores 131 130 1 – 131
Hemköp stores offering online shopping 68 72 -4 – 68
Private label products, share of sales, % 28.0 27.1 0.9 – 26.2
Sustainability-labelled products, share of sales, % 27.1 28.2 -1.1 26.7 27.0
Average number of employees 1,550 1,565 -15 – 1,632
Share of women in management positions, % 1) 50.7 49.8 0.9 – 49.4
Sickness-related absence, % 6.8 9.0 -2.2 6.1 6.7
1) The definition of “Share of women in management positions” has been revised to also include team managers. Comparison figures have been restated.
Hemköp offers a broad,
attractively priced assortment
with a rich offering of fresh
products. Through Group-owned
stores, retailer-owned stores
and an online business, Hemköp
inspires good meals. The
Hemköp operating segment also
includes Tempo, a mini-mart
format comprising retailer-
owned stores.
Net sales and
operating margin
===== SIDA 11 =====
Axfood interim report 1 January–31 March 2023 | 11
Snabbgross
First quarter
Net sales totalled SEK 1,147 m (934), an
increase of 22.7%. Growth in like-for-like
sales amounted to 19.2%.
Snabbgross’s strong sales growth was
mainly due to the recovery of the café and
restaurant market after the pandemic as well
as food price inflation. Developments in newly
established stores and sales to consumers
through the member-based Snabbgross Club
store concept also contributed. Towards the
end of the quarter, a slowdown was noted in
the café and restaurant market, which had a
negative impact on volumes.
The number of stores in the segment
amounted to 29 (27), of which 24 (25) were
Snabbgross stores and 5 (2) were Snabbgross
Club stores.
Operating profit amounted to SEK 30 m
(30), corresponding to an operating margin
of 2.6% (3.2). Some negative product mix
effects, costs related to new stores and
marketing for Snabbgross Club were charged
against profit. Operating profit was also
negatively impacted by higher costs for
premises related to rent and electricity.
Snabbgross key ratios
Q1
2023
Q1
2022 Change R12
Full-year
2022
Net sales, SEK m 1,147 934 22.7% 4,939 4,727
Operating profit, SEK m 30 30 -0.7% 252 252
Operating margin, % 2.6 3.2 -0.6 5.1 5.3
Wholesale sales, SEK m 1,151 938 22.6% 4,961 4,748
Like-for-like sales growth, % 19.2 24.7 -5.5 – 20.1
Number of stores 29 27 2 – 29
of which, Snabbgross 24 25 -1 – 24
of which, Snabbgross Club 5 2 3 – 5
Sustainability-labelled products, share of sales, % 19.4 19.4 -0.1 18.8 18.8
Average number of employees 495 448 47 – 524
Share of women in management positions, % 1) 43.6 38.5 5.2 – 40.7
Sickness-related absence, % 7.7 9.5 -1.8 7.1 7.5
1) The definition of “Share of women in management positions” has been revised to also include team managers. Comparison figures have been restated.
Snabbgross is one of Sweden’s
leading restaurant wholesalers
with a customer base of
restaurants, fast food operators
and cafés. Snabbgross offers
personal service, accessibility,
and quality at its stores and
online. The Snabbgross
operating segment also includes
the concept Snabbgross Club,
which is directed at consumers.
Net sales and
operating margin
===== SIDA 12 =====
Axfood interim report 1 January–31 March 2023 | 12
Dagab
First quarter
Net sales totalled SEK 17,753 m (15,062), an
increase of 17.9%. The growth in net sales was
mainly attributable to the sharp increase in
sales to store chains.
Operating profit amounted to SEK 207 m
(429), corresponding to an operating margin
of 1.2% (2.8). Operating profit included a total
of SEK -55 m (182) in items affecting
comparability, which entirely pertained to
parallel warehouse operations during the
transition to the new logistics centre in Bålsta.
In the year-earlier period, items affecting
comparability included a capital gain of
SEK 221 m for the sale of Mat.se, integration
costs of SEK -33 m for Bergendahls Food, and
SEK -6 m related to Dagab’s restructuring of
its logistics operation.
Adjusted operating profit amounted to
SEK 261 m (247) and the adjusted operating
margin was 1.5% (1.6). The higher operating
profit was primarily attributable to strong
growth. Despite major restructuring within
logistics, productivity remained strong.
However, operating profit was impacted
negatively by increased market investments
to support Dagab’s customers and higher
logistics costs as a result of lower delivery
reliability, mainly due to high volatility in
demand.
The work on the Group’s new warehouse
and logistics structure is proceeding. During
the first quarter, some 100 stores began
receiving deliveries of products from the dry
assortment from the new logistics centre in
Bålsta.
Dagab key ratios
Q1
2023
Q1
2022 Change R12
Full-year
2022.
Net sales, SEK m 17,753 15,062 17.9% 69,690 66,999
Operating profit, SEK m 207 429 -51.8% 755 978
Operating profit excl. items affecting comparability, SEK m 1) 261 247 5.9% 1,154 1,139
Operating margin, % 1.2 2.8 -1.7 1.1 1.5
Operating margin excl. items affecting comparability, % 1) 1.5 1.6 -0.2 1.7 1.7
Delivery reliability, % 91.8 93.9 -2.1 – 90.6
Average number of employees 3,295 3,431 -136 – 3,438
Share of women in management positions, % 2) 28.2 25.0 3.2 – 28.8
Sickness-related absence, % 7.9 10.5 -2.6 7.3 7.9
1) See Note 9 Items affecting comparability for more information.
2) The definition of “Share of women in management positions” has been revised to also include team managers. Comparison figures have been restated.
Dagab operates and develops
the Group’s assortment,
purchasing and logistics, but
also conducts sales to external
customers. The Dagab operating
segment also includes retailer-
owned Handlar’n and Matöppet,
the meal kit company
Middagsfrid, the online
pharmacy Apohem and the
restaurant chain Urban Deli.
Net sales and
operating margin
===== SIDA 13 =====
Axfood interim report 1 January–31 March 2023 | 13
Other information
Long-term targets and
capital expenditures 2023
Axfood’s long-term financial targets:
• Grow faster than the market
• Long-term operating margin of at least 4.5%
• Equity ratio of at least 20% at year-end
Axfood’s dividend policy is that the shareholder
dividend is to be at least 50% of profit after tax.
The dividend is to be paid out on two occasions.
Investments in 2023 are expected to amount to
between SEK 1,800 and SEK 1,900 m, excluding
acquisitions and right-of-use assets, of which
approximately SEK 400 m pertains to the new logistics
centre in Bålsta outside Stockholm and SEK 170 m pertains
to the nationwide warehouse for fruits and vegetables in
Landskrona (the majority of which concerns automation).
During 2023, Axfood plans to speed up its rate of
expansion by establishing 10–15 new stores.
Costs affecting comparability of approximately
SEK 250 m are expected to be charged against Axfood’s
operating profit for 2023 in order to ensure stable
operation and a transition to the new logistics centre in
Bålsta outside Stockholm. The investments are expected
to result in SEK 200-300 m in annual efficiency improve-
ments beginning in the second half of 2024, which will
then increase to SEK 300-400 m at full capacity.
This interim report has not been reviewed
by the Company’s auditors.
Stockholm, 26 April 2023
Klas Balkow,
President and CEO, Axfood AB
2023 Annual General Meeting
Axfood’s AGM was held on 22 March 2023 in Stockholm.
The AGM re-elected all proposed directors except Christer
Åberg, who declined re-election, and elected Thomas
Ekman as a new director. The AGM also resolved to pay a
dividend of SEK 8.15 per share. The first dividend payment
of SEK 4.15 was made in March and the second payment
of SEK 4.00 will be made in September. The AGM also
resolved to implement an additional long-term incentive
programme, LTIP 2023.
===== SIDA 14 =====
Axfood interim report 1 January–31 March 2023 | 14
Financial statements, Group
Condensed statement of profit or loss and
other comprehensive income, Group
SEK m
Q1
2023
Q1
2022 R12
Full-year
2022
Net sales 19,252 16,593 76,134 73,474
Cost of goods sold1) -16,528 -14,301 -65,618 -63,392
Gross profit 2,724 2,291 10,516 10,083
Selling expenses1) -1,003 -883 -3,740 -3,620
Administrative expenses1) -1,171 -937 -4,473 -4,239
Share of profit in associated companies and joint ventures -7 -17 -56 -66
Other operating income 1) 161 416 780 1,034
Other operating expenses1) -10 -36 -66 -92
Operating profit 695 835 2,961 3,101
Interest income and similar profit/loss items 4 2 28 26
Interest expense and similar profit/loss items -84 -43 -233 -193
Profit before tax 615 794 2,756 2,935
Tax -143 -112 -596 -565
Net profit for the period 472 682 2,160 2,370
Other comprehensive income
Items that cannot be reclassified to profit or loss for the period, net after tax
Revaluation defined benefit pensions 1 -1 72 70
Change in holdings measured at fair value 2) -273 – -908 -635
Items that can be reclassified to profit or loss for the period, net after tax
Change in hedging reserve -9 16 62 86
Other comprehensive income for the period -281 14 -774 -479
Total comprehensive income for the period 191 696 1,387 1,892
Net profit for the period attributable to
Owners of the parent 475 690 2,146 2,360
Non-controlling interests -3 -8 15 10
Total comprehensive income for the period attributable to
Owners of the parent 194 704 1,372 1,882
Non-controlling interests -3 -8 15 10
Earnings per share before dilution, SEK 3) 2.20 3.27 9.99 11.04
Earnings per share after dilution, SEK 3) 2.19 3.26 9.94 10.99
1) Includes items affecting comparability, see Note 9 Items affecting comparability for more information.
2) See Note 5 Financial assets and liabilities for more information.
3) Comparison figures were revalued for the bonus issue element of the rights issue that was completed in the second quarter of 2022.
===== SIDA 15 =====
Axfood interim report 1 January–31 March 2023 | 15
Condensed statement of financial position, Group
SEK m 31 Mar 2023 31 Mar 2022 31 Dec 2022
Assets
Goodwill 3,606 3,406 3,526
Other intangible assets 1,499 1,403 1,464
Property, plant and equipment 5,502 4,056 5,294
Right-of-use assets 9,413 6,570 9,025
Financial assets 420 1,138 598
Deferred tax assets 243 337 253
Total non-current assets 20,682 16,909 20,159
Inventories 4,521 3,239 3,839
Trade receivables 2,070 2,207 2,143
Other current assets 1,911 1,407 1,917
Cash and bank balances 311 378 559
Assets held for sale – 46 –
Total current assets 8,813 7,276 8,459
Total assets 29,496 24,185 28,618
Equity and liabilities
Equity attributable to owners of the parent 5,059 4,045 6,609
Equity attributable to non-controlling interests 289 216 292
Total equity 5,348 4,261 6,901
Non-current lease liabilities 7,667 4,988 7,388
Provisions for pensions 281 366 292
Deferred tax liabilities 1,290 1,201 1,289
Other non-current liabilities 6 42 6
Total non-current liabilities 9,245 6,597 8,975
Current lease liabilities 1,754 1,590 1,662
Current interest-bearing liabilities 1,499 1,660 200
Trade payables 7,130 6,208 7,190
Other current liabilities 4,520 3,869 3,691
Total current liabilities 14,902 13,327 12,743
Total equity and liabilities 29,496 24,185 28,618
===== SIDA 16 =====
Axfood interim report 1 January–31 March 2023 | 16
Condensed statement of cash flows, Group
SEK m
Q1
2023
Q1
2022 R12
Full-year
2022
Operating activities
Operating profit 695 835 2,961 3,101
Adjustments for non-cash items 48 -200 123 -125
Depreciation, amortisation, impairment 703 644 2,674 2,615
Interest paid -84 -38 -213 -167
Interest received 4 1 15 12
Paid tax -233 -213 -588 -568
Changes in working capital -652 400 6 1,058
Cash flow from operating activities 481 1,429 4,979 5,927
Investing activities
Acquisitions of operations – 12 -2 10
Acquisitions of intangible assets -159 -71 -462 -374
Acquisitions of property, plant and equipment -392 -460 -2,151 -2,219
Acquisitions of financial assets -103 -12 -247 -156
Other changes in investing activities 10 -50 21 -39
Cash flow from investing activities -644 -581 -2,841 -2,778
Financing activities
Issue of shares – – 1,485 1,485
Loans raised 1,799 60 2,402 663
Amortisation of debt -988 -428 -4,330 -3,770
Shareholder contribution from minority owners – – 59 59
Share repurchases – – -115 -115
Dividend paid out -896 -836 -1,706 -1,646
Cash flow from financing activities -85 -1,204 -2,205 -3,324
Cash flow for the period -248 -356 -67 -175
Condensed statement of changes in equity, Group
SEK m 31 Mar 2023 31 Mar 2022 31 Dec 2022
Amount at start of year 6,901 5,176 5,176
Total comprehensive income for the period 191 696 1,892
Change in non-controlling interests – – 0
Rights issue1) – – 1,485
Share repurchases – – -115
Share-based payments 15 10 50
Shareholder contribution from minority owners – – 59
Dividend to shareholders -1,759 -1,621 -1,646
Amount at end of period 5,348 4,261 6,901
1) See Note 8 Equity for more information.
===== SIDA 17 =====
Axfood interim report 1 January–31 March 2023 | 17
Financial statements, Parent Company
Condensed income statement, Parent Company
SEK m
Q1
2023
Q1
2022
Full-year
2022
Net sales 6 2 8
Selling and administrative expenses -132 -108 -514
Other operating income 90 73 301
Operating loss -36 -33 -205
Net financial items 2 1 260
Profit/loss after financial items -34 -32 56
Appropriations, net – – 2,154
Profit/loss before tax -34 -32 2,209
Tax 3 5 -410
Net profit/loss for the period -32 -27 1,799
Net profit/loss for the period corresponds to total comprehensive income for the period.
Condensed balance sheet, Parent Company
SEK m 31 Mar 2023 31 Mar 2022 31 Dec 2022
Assets
Property, plant and equipment 32 36 33
Participations in Group companies 4,397 4,292 4,389
Other financial assets 1 13 1
Deferred tax assets 8 6 8
Total non-current assets 4,437 4,346 4,431
Receivables from Group companies 1) 5,054 3,645 6,244
Other current assets 187 128 28
Cash and cash equivalents 10 129 96
Total current assets 5,251 3,902 6,368
Total assets 9,689 8,248 10,799
Equity and liabilities
Restricted equity 296 287 296
Non-restricted equity 2,286 859 4,062
Total equity 2,582 1,147 4,358
Untaxed reserves 3,661 3,487 3,661
Provisions 4 9 6
Non-current liabilities 8 4 8
Current interest-bearing liabilities 1,499 1,660 200
Trade payables 34 10 18
Liabilities to Group companies 2) 935 981 2,363
Other current liabilities 965 950 186
Total current liabilities 3,433 3,602 2,767
Total equity and liabilities 9,689 8,248 10,799
1) Of which, interest-bearing receivables 5,022 3,620 3,849
2) Of which, interest-bearing liabilities 934 981 2,291
===== SIDA 18 =====
Axfood interim report 1 January–31 March 2023 | 18
Notes
Note 1 Accounting policies
Axfood applies the International Financial Reporting
Standards (IFRS) as endorsed by the EU. The accounting
policies, measurement principles and definitions applied
correspond with those described in the 2022 Annual and
Sustainability Report, except for what is stated below.
This interim report has been prepared for the Group in
accordance with IAS 34 Interim Financial Reporting and
the Swedish Annual Accounts Act. For the Parent
Company, the interim report has been prepared in
accordance with recommendation RFR 2 Accounting for
Legal Entities, issued by the Swedish Financial Reporting
Board (RFR), and the Swedish Annual Accounts Act.
New accounting policies effective in 2023 and later
Axfood has determined that new or amended standards
and interpretations do not and will not have any material
effect on the consolidated financial statements.
Significant estimates and assessments
Preparing the financial statements in accordance with
IFRS requires the Board and Executive Committee to
make judgements and estimates as well as assumptions
that affect the application of the accounting policies and
the Company’s result and position as well as other
disclosures in general. The actual outcome may deviate
from these estimates and assessments.
Note 2 Other material information
Seasonal effects
Axfood’s sales are affected to some degree by seasonal
variations. Sales increase in the quarter in which Easter
falls, which is either the first or second quarter. Sales also
increase ahead of Midsummer during the second quarter
as well as ahead of the major holiday season during the
fourth quarter.
Significant risks and uncertainties
Like all business activities, Axfood’s business is exposed to
risks. The risks are broken down into operational, strategic
and financial risks. Climate and environmental risks are
included in operational risks. In recent years, the risk
scenario has been impacted by a number of external
factors, such as the spread of the Covid-19 pandemic and
the war in Ukraine. The risks that could have the greatest
impact on the Group are the risk of disruptions in the
logistics chain, IT and information security risks, and
liability and trust risks. Axfood works continuously with
risk identification and assessment. Major emphasis is
placed on preventive work and on planning to maintain
operating continuity in the event of unforeseen events. For
a thorough account of the risks that affect the Group,
please refer to the 2022 Annual and Sustainability Report.
Transactions with related parties
The Axfood Group’s transactions with related parties,
aside from those covered by the consolidated financial
statements, consist of transactions with associated
companies and with subsidiaries within the Axel Johnson
Group.
Note 3 Operating segments
Segments have been defined based on how Axfood’s
Executive Committee monitors and governs the
operations to evaluate performance and allocate
resources. The operating segments that have been
identified are Willys, Hemköp, Snabbgross and Dagab.
Joint-Group pertains to head office support functions,
such as the Executive Committee, Accounting and
Finance, Legal Affairs, HR, Communications, Business
Development and IT. The Executive Committee reviews
the segments’ operating profit or loss, both including and
excluding items affecting comparability.
For information about Axfood’s operating segments,
see pages 9-12 of this interim report. For a more detailed
description of the segments, please refer to the 2022
Annual and Sustainability Report.
===== SIDA 19 =====
Axfood interim report 1 January–31 March 2023 | 19
Note 4 Acquired and divested operations
No significant acquisitions or divestments took place in
the first quarter of 2023.
During the first quarter of 2022, Mat.se was sold to
Mathem. The acquired shares in Mathem corresponded to
a shareholding of 16.5% of Mathem. The capital gain from
the divestment of Mat.se amounted to SEK 221 m and was
recognised in other operating income during the first
quarter of 2022. The capital gain was recognised in the
operational earnings follow-up as an item affecting
comparability in the Dagab segment.
Note 5 Financial assets and liabilities
Financial assets measured at fair value amounted to SEK
91 m (758). SEK 57 m (–) is attributable to Level 2 of the
fair value hierarchy and SEK 34 m (758) is attributable to
Level 3. Financial liabilities measured at fair value
amounted to SEK – m (42). The entire amount is
attributable to Level 2 of the fair value hierarchy.
The carrying amount of the call option agreement
entered into with City Gross in conjunction with the
acquisition amounted to SEK 0 m (0). The call option
agreement is recognised at fair value based on an
assessment of the change in City Gross’s future sales and
earnings performance.
The carrying amount of the participation in Mathem
amounted to SEK 34 m (758). During the first quarter,
Axfood undertook to participate in Mathem’s upcoming
issue of convertibles of SEK 101 m. The holding in Mathem
was negatively revalued by SEK 273 m during the quarter.
The revaluation represented an adjustment of the
valuation of the Company established in connection with
the new issue to be carried out in the second quarter. The
valuation corresponds to an EV/sales multiple of 0.3x
based on Mathem’s LTM sales as of 31 December 2022. A
10% increase in the multiple would have resulted in a
valuation of SEK 45 m, while a corresponding reduction of
the multiple would have resulted in a valuation of SEK 21
m. The holding in Mathem is regularly revalued, given the
uncertainty in the financial markets and its effect on the
valuation.
Forward exchange contracts are measured at fair
value based on the Central Bank of Sweden’s spot rates on
the accounting date, which is assessed to be a reasonable
approximation of fair value.
Changes in the fair value of financial assets attributable to
Level 3, SEK m
Amount at start of year 206
Convertible loans 101
Revaluation via other comprehensive income -273
Amount at end of period 34
Note 6 Pledged assets and contingent liabilities
Group, SEK m 31 Mar 2023 31 Mar 2022 31 Dec 2022
Pledged assets – – –
Contingent liabilities 19 105 20
Parent Company, SEK m 31 Mar 2023 31 Mar 2022 31 Dec 2022
Pledged assets – – –
Contingent liabilities 256 244 256
Note 7 Long-term share-based incentive programmes
The 2023 AGM resolved to adopt a new long-term share-
based incentive programme that runs over a three-year
period, LTIP 2023. The programme corresponds in all
essential respects to LTIP 2022, with the exception that
the number of savings shares that may be allocated has
been reduced to the number of shares that applied for LTIP
2021 and the reference group of companies for measuring
the share price performance has been adjusted for a
delisted share. Allotment of LTIP 2020 will be carried out
in April 2023 using treasury shares.
The 2023 AGM resolved to authorise Axfood’s Board of
Directors to decide on the purchase of a maximum of
330,000 own shares for the purpose of securing the
Company’s obligations under LTIP 2023, which the Board
has decided to do. Prior to the allotment of LTIP 2020 and
share repurchases related to LTIP 2023, the holding of
treasury shares amounts to 1,037,856 shares, which is
sufficient to secure the delivery of shares for all of the
Company’s incentive programmes.
For more information about incentive programmes,
see Axfood’s 2022 Annual and Sustainability Report.
===== SIDA 20 =====
Axfood interim report 1 January–31 March 2023 | 20
Note 8 Equity
A rights issue was carried out during the second quarter
of 2022. The rights issue comprised 6,972,528 shares,
and Axfood received SEK 1,499 m from the rights issue
before issue costs. The number of registered shares is
216,843,240 after the rights issue.
Change in number of shares and share capital
Number of shares
Share capital, SEK
1 January 2022 209,870,712 262,338,390
Rights issue 2022 6,972,528 8,715,660
31 December 2022 216,843,240 271,054,050
Note 9 Items affecting comparability
Items affecting comparability in the first quarter of 2023
amounted to SEK -55 m and pertained entirely to parallel
warehouse operations within Dagab. The costs mainly
included premises and personnel costs and were entirely
attributable to the transition to the new logistics centre in
Bålsta. The costs are included in the cost of goods sold.
Items affecting comparability in the first quarter of
2022 comprised integration costs, structural costs and
a capital gain. Integration costs totalled SEK -33 m and
pertained in their entirety to the integration of
Bergendahls Food. Integration costs consisted primarily of
costs for external consultants and were included in other
operating expenses. Structural costs amounted to SEK -6
m and pertained to costs connected with the restructuring
of Dagab’s logistics operation. Structural costs mainly
included personnel costs and were included in
administrative expenses. The capital gain of SEK 221 m
pertained to earnings from the divestment of Mat.se,
which was recognised in other operating income.
Segment
Q1
2023
Q1
2022
Full-year
2022
Parallel warehouse
operations Dagab -55 – –
Integration costs Dagab – -33 -120
Structural costs Dagab – -6 -263
Capital gain Dagab – 221 221
Fora/AFA Joint-Group – – 33
Total -55 182 -129
Note 10 Significant events after the balance sheet date
No significant events have occurred after the balance sheet date.
===== SIDA 21 =====
Axfood interim report 1 January–31 March 2023 | 21
Key ratios
Change in store structure
Number of stores
Dec
2022
New
establishment/
acquisitions
Sales/
closures Conversions
March
2023
March
2022
Willys/Willys Hemma/Eurocash 232 4 – – 236 227
Hemköp/Tempo, Group-owned stores 64 – – 1 65 64
Snabbgross/Snabbgross Club 29 – – – 29 27
Total, Group-owned stores 325 4 – 1 330 318
Hemköp, retailer-owned stores 137 1 -1 -1 136 135
Tempo, retailer-owned stores 131 1 -1 – 131 130
Total, retailer-owned stores 268 2 -2 -1 267 265
Total, Group-owned and retailer-owned stores 593 6 -2 0 597 583
Key ratios and other data, Group
SEK m
3 mos
2023
3 mos
2022
Full-year
2022
Operating margin, % 3.6 5.0 4.2
Operating margin excl. items affecting comparability, % 3.9 3.9 4.4
Equity ratio, % 18.1 17.6 24.1
Net debt (+)/net receivable (-), SEK m 10,889 8,225 8,982
Net debt (+)/net receivable (-) excl. IFRS 16, SEK m 1,468 1,648 -68
Net debt/EBITDA, multiple 1.9 1.5 1.6
Net debt/EBITDA excl. IFRS 16, multiple 0.4 0.4 0.0
Net debt-equity ratio (+)/net receivable-equity ratio (-), multiple 2.0 1.9 1.3
Net debt-equity ratio (+)/net receivable-equity ratio (-), excl. IFRS 16, multiple 0.3 0.4 0.0
Capital employed, SEK m 16,549 12,865 16,442
Return on capital employed R12, % 20.3 26.5 20.9
Return on equity R12, % 47.1 65.5 40.8
Average number of employees during the year 12,421 12,193 12,772
Total capital expenditures, SEK m 1,417 1,135 6,967
Investments in intangible assets and in property, plant and equipment, SEK m 551 531 2,593
Depreciation/amortisation, SEK m -700 -644 -2,580
Number of shares outstanding at end of period 215,805,384 209,104,732 215,805,384
Average number of shares outstanding before dilution 215,805,384 209,104,732 213,117,592
Average number of shares outstanding after dilution 216,843,240 209,870,712 214,036,026
Key data per share
Earnings per share before dilution, SEK 1) 2.20 3.27 11.04
Earnings per share before dilution excl. items affecting comparability, SEK 1) 2.40 2.43 11.36
Earnings per share after dilution, SEK 1) 2.19 3.26 10.99
Ordinary dividend per share, SEK 2) – – 8.15
Equity per share, SEK 23.44 19.35 30.62
Cash flow per share, SEK -1.15 -1.70 -0.82
1) Comparison figures were restated for the bonus issue element of the rights issue that was completed in the second quarter of 2022.
2) Paid out on two occasions.
===== SIDA 22 =====
Axfood interim report 1 January–31 March 2023 | 22
Quarterly overview, Group
SEK m
Q1
2023
Q4
2022
Q3
2022
Q2
2022
Q1
2022
Q4
2021
Q3
2021
Q2
2021
Net sales 19,252 19,740 18,674 18,468 16,593 17,062 13,723 13,903
Operating profit 695 502 975 789 835 739 793 607
Operating profit excl. items affecting
comparability 750 734 1,015 828 653 653 811 661
Operating margin, % 3.6 2.5 5.2 4.3 5.0 4.3 5.8 4.4
Operating margin excl. items affecting
comparability, % 3.9 3.7 5.4 4.5 3.9 3.8 5.9 4.8
Net profit for the period 472 353 745 590 682 608 601 455
Earnings per share before dilution, SEK 1) 2.20 1.62 3.40 2.75 3.27 2.90 2.90 2.26
Earnings per share before dilution excl. items
affecting comparability, SEK 1) 2.40 2.47 3.55 2.90 2.43 2.57 2.97 2.46
Cash flow from operating activities 481 1,844 1,487 1,167 1,429 1,288 1,054 1,121
Cash flow from operating activities per share, SEK 2.23 8.54 6.89 5.51 6.83 6.16 5.04 5.36
Return on capital employed R12, % 20.3 20.9 25.8 26.4 26.5 22.4 22.6 25.6
Return on equity R12, % 47.1 40.8 49.9 51.3 65.5 46.3 47.4 56.1
Equity per share, SEK 23.44 30.62 28.70 28.15 19.35 23.68 20.61 17.56
Total capital expenditures, SEK m 1,417 4,046 544 1,247 1,135 929 870 987
Investments in intangible assets and property,
plant and equipment 551 883 274 904 531 616 613 304
Depreciation/amortisation, SEK m -700 -686 -642 -644 -644 -634 -596 -588
Items affecting comparability -55 -232 -40 -39 182 86 -18 -54
Net debt (+)/net receivable (-) 10,889 8,982 6,868 7,005 8,225 7,640 5,481 4,920
Share price, SEK 253.20 285.90 254.90 294.30 306.20 260.40 209.70 236.70
1) Comparison figures were restated for the bonus issue element of the rights issue that was completed in the second quarter of 2022.
===== SIDA 23 =====
Axfood interim report 1 January–31 March 2023 | 23
Financial key ratios
In addition to the financial key ratios prepared in
accordance with IFRS, Axfood presents financial key
ratios that are not defined by IFRS or by the Swedish
Annual Accounts Act, so-called alternative performance
measures (APMs). These APMs aim to provide
supplementary information that contributes to analysing
Axfood’s operations and development. The APMs used are
considered generally accepted in the industry. APMs
should not be seen as a substitute for financial information
presented in accordance with IFRS, but as a complement.
The APMs are defined below under the financial key ratio
definitions.
Certain APMs are also reported excluding IFRS 16 to
enable a follow-up of operational development excluding
the technical accounting effects as a result of IFRS 16.
Some APMs are also reported excluding items affecting
comparability since the adjusted performance measure
provides a better understanding of the operations’
underlying development when comparing between
periods.
Reconciliation of EBITDA
SEK m
Q1
2023
Q1
2022 R12
Full year
2022
Operating profit 695 835 2,961 3,101
Depreciation, amortisation, impairment 703 644 2,675 2,615
EBITDA 1,398 1,479 5,636 5,716
IFRS 16 Lease fees -531 -454 -1,981 -1,904
EBITDA excl. IFRS 16 867 1,025 3,654 3,812
For reconciliation of additional key ratios, see Axfood’s website, axfood.com.
Financial key ratio definitions
Earnings per share (defined in IFRS): Net profit for the period
attributable to owners of the parent divided by the average number of
shares outstanding. Reported both before and after dilution. Earnings
per share are also reported based on earnings excluding items
affecting comparability.
EBITDA: Operating profit before depreciation, amortisation and
impairment. Also reported excluding the effects of reporting in
accordance with IFRS 16 as EBITDA excl. IFRS 16. Indicates the
underlying development of the operations.
Equity per share: Share of equity attributable to owners of the parent
divided by the number of shares outstanding at the end of the period.
Indicates shareholders’ share of the Company’s total equity per share.
Equity ratio: Equity including non-controlling interests as
a percentage of total assets. An equity ratio of at least 20% at year-
end is one of Axfood’s Group-wide strategic targets.
Capital employed: Total assets less non-interest-bearing liabilities
and non-interest-bearing provisions. Measures the Group’s capital use
and efficiency.
Cash flow from operating activities per share: Cash flow from
operating activities for the period divided by the average number of
shares outstanding before dilution. Indicates cash flow generated
from operating activities.
Cash flow per share: Cash flow for the period divided by the average
number of shares outstanding before dilution. Indicates cash flow
generated per share.
Items affecting comparability: Financial effects in connection with
major acquisitions and divestments or other major structural changes
as well as material non-recurring items that are relevant in order to
understand the results when comparing between periods.
Net debt/EBITDA: Net debt divided by EBITDA on a rolling
12-month basis. Also reported excluding the effects of reporting in
accordance with IFRS 16. Indicates the Group’s ability to pay its debt.
Net debt-equity ratio/net receivable-equity ratio: Net debt/
net receivable divided by equity including non-controlling interests.
Also reported excluding the effects of reporting in accordance with
IFRS 16. Indicates the Company’s debt-equity ratio.
Net debt/net receivable: Interest-bearing non-current and current
receivables and liabilities less cash and cash equivalents and interest-
bearing financial assets. Net indebtedness is also referred to as net
debt. Net receivable is also referred to as net receivables. Used to
show the Company’s net interest-bearing assets and liabilities.
Net debt/net receivable excluding IFRS 16: Interest-bearing non-
current and current receivables and liabilities, excluding lease
liabilities, less cash and cash equivalents and interest-bearing
financial assets.
Operating margin: Operating profit as a percentage of net sales for
the period. An operating margin of at least 4.5% is one of Axfood’s
strategic Group-wide targets.
Operating margin excluding items affecting comparability:
Operating profit excluding items affecting comparability as a
percentage of net sales for the period. Also referred to as adjusted
operating margin.
Operating profit: Profit before net financial items and tax. Indicates
profitability for operating activities.
Operating profit excluding items affecting comparability: Profit
before net financial items and tax adjusted for items affecting
comparability. Also referred to as adjusted operating profit.
Return on capital employed: Profit after financial items, plus financial
expenses on a rolling 12-month basis as a percentage of average
capital employed. Indicates profitability in both equity and borrowed
capital in the Company.
Return on equity: The share of net profit for the period on a rolling
12-month basis attributable to owners of the parent as a percentage
of the share of average equity attributable to owners of the parent.
Indicates the return that owners receive on capital invested.
Sales growth: Percentage change in sales between two periods.
Axfood monitors growth in both retail sales and net sales. One of
Axfood’s Group-wide strategic targets is to grow faster than the
market and growth in retail sales is the target Axfood uses to measure
this.
===== SIDA 24 =====
Axfood interim report 1 January–31 March 2023 | 24
Operating key ratio definitions and glossary
Average number of employees: Total number of hours worked divided
by the number of hours worked per year of 1,920.
Delivery reliability: Share of delivered goods in relation the share of
ordered goods.
Joint-Group: Pertains to head office support functions, such as the
Executive Committee, Finance/Accounting, Legal Affairs,
Communications, Business Development, HR and IT.
Like-for-like sales: Sales in stores that existed and generated sales in
the current period and the comparison period.
Online sales: Reported online sales of the concepts Willys, Hemköp
Group-owned stores and Hemköp retailer-owned stores.
R12: The sum of the past 12 months determined on a rolling basis.
Retail sales: Reported store sales including online sales for the
concepts Willys, Willys Hemma, Eurocash, Hemköp Group-owned
stores, Hemköp retailer-owned stores and Tempo, excluding
adjustments mainly related to customer bonuses.
Share of sales, private label products: Sales of private label products,
excluding meat, fruits and vegetables, as a percentage of retail sales.
Share price: Closing share price.
Wholesale sales: Company and private customer sales including
online for the concepts Dagab and Snabbgross (including Snabbgross
Club).
Key ratio definitions for sustainability
Electricity consumption in stores and warehouses: Reported as the
number of kilowatt hours (kWh) of purchased electricity used per
square metre (sq. m.). The selection includes electricity consumption
under joint contracts for a total of 304 of Axfood’s Group-owned
stores and ten warehouses. The number of square metres corresponds
to the total area of all stores and warehouses in the selection.
Reported data is presented on a rolling 12-month basis. As of the first
quarter of 2023, more warehouses are included in the calculation
since they are now encompassed by Axfood’s central power purchase
agreement. Comparison figures have not been restated.
Emissions from own transports: Emissions (kg CO2e) from purchased
fuel (litres) in relation to total transported goods (tonnes) between
warehouses and stores. Reported data pertains only to goods
delivered by own transports. Reported data for the quarter and
accumulated are presented with a one-month lag.
Gender equality: The share of women in management positions at the
end of the current period. Management positions are defined as
employed managers with employee responsibility, including the
Executive Committee. As of the first quarter of 2023, the key ratio has
been redefined to also include team managers. Comparison figures
have been restated. Reported data is presented on a rolling 12-month
basis.
Growth in vegetarian protein substitutes: Percentage change in sales
of vegetarian protein substitutes compared with the year-earlier
period. Vegetarian protein substitutes include refrigerated and frozen
items. The selection includes Group-owned stores in the Willys,
Eurocash, Hemköp and Snabbgross store chains.
KRAV-certified meat share of sales: Sales from KRAV-certified meat
items (fresh and frozen) as a percentage of the Axfood Group’s total
sales of meat products. The selection includes Group-owned stores in
the Willys, Hemköp and Snabbgross store chains.
Organic products share of sales: Sales from organic-labelled products
with a valid country of origin marking as a percentage of Axfood’s
total food sales. The selection includes Group-owned stores in the
Willys, Eurocash, Hemköp and Snabbgross store chains.
Share of approved social audits: Share of social audits where the
supplier received a score of A, B or C on a scale of A to E, where A is
without remarks and E is unacceptable. Social audits comprise on-site
visits and inspections to ensure suppliers fulfil the requirements of
Axfood’s Code of Conduct. The selection includes on-site visits carried
out by the organisation Amfori BSCI.
Sickness-related absence: The number of reported hours of sickness-
related absence in relation to scheduled work time. The selection
includes active employees in Axfood. Active employees pertains to all
employees in the Group except for employees of Urban Deli AB and
Hall Miba AB. Internal consultants and employees on parental leave or
leave of absence are not included. Sickness-related absence for the
first quarter pertains to time worked during the December–February
period.
Sustainability-labelled products share of sales: Sales from
sustainability-labelled products with a valid country of origin marking
as a percentage of Axfood’s total food sales. The selection includes
Group-owned stores in the Willys, Eurocash, Hemköp and Snabbgross
store chains.
===== SIDA 25 =====
Axfood AB, SE-107 69 Stockholm
Solnavägen 4
Tel. (switchboard): +46 8 553 990 00
Corporate reg. number: 556542-0824
info@axfood.se, axfood.com
linkedin.com/company/axfood
Instagram: @axfoodkoncernen
Twitter: @axfood
facebook.com/axfoodkoncernen
About Axfood
Axfood is a leader in food retail in Sweden and a family of different concepts in collaboration. Axfood
has more than 12,000 employees (FTEs) and net sales of more than SEK 70 billion. Axfood aspires to be
a strong force in society that drives development toward more sustainable food production and
consumption. The share is listed on Nasdaq Stockholm and the principal owner is Axel Johnson.
Purpose
Better quality
of life for
everyone.
Vision
A leader in
affordable,
good and
sustainable
food.
Business concept
A family
of different
concepts in
collaboration.
Business model and strategy
Axfood’s business model covers purchasing and assortment, logistics and
sales channels and concepts. The customer is always in focus and value is
created for Axfood and the Group’s stakeholders in every step.
Axfood pursues a strategy of growth-promoting and efficiency enhancing
priorities. The strategy is built on six strategic focus areas: customer
offering, customer meeting, expansion, supply chain, work approach and our
people. To promote growth, the focus is on developing and offering an
attractively priced assortment. Apart from growing sales at existing stores,
key initiatives include continued expansion through the e -commerce roll-
out and establishment of new formats and more stores. We are striving to
increase efficiency in the organisation through a more d ata-driven work
approach and continuous development of logistics solutions of the future.
To stay at the forefront, we need to continue building a culture that enables
the industry’s best employees to be attracted and developed. Axfood
aspires to take the lead in promoting a sustainable food system and to be
a strong force for change in society.
Long-term financial targets and dividend policy
• Axfood’s long-term financial targets:
Grow faster than the market
Long-term operating margin of at least 4.5%
Equity ratio of at least 20% at year-end
• Axfood’s dividend policy is that the shareholder dividend is to be
at least 50% of profit after tax. The dividend is to be paid out on
two occasions.
2030 targets
Axfood’s purpose is to create a better quality of life for everyone. We work
to improve and simplify life around food for everyone we impact through
our different concepts, operations and brands. Our ambition is to, by 2030:
• be Sweden’s most inclusive food company
• be the strongest driving force for sustainable food in Sweden
• have created a healthier Sweden
• be a leader in the development of the simplest and best food
experiences
Operating segments
• Willys has the ambition to offer Sweden’s cheapest bag of groceries
and is the leading discount grocery chain. Willys aims to develop the
discount segment in food retail with a wide assortment in Group -owned
stores and online. The Willys operating segment includes the concepts
Willys, Willys Hemma, the partly owned cross -border grocery chain
Eurocash and a minority stake in the City Gross hypermarket chain.
• Hemköp offers a broad, attractively priced assortment with a rich
offering of fresh products. Through Group-owned stores, retailer-owned
stores and an online business, Hemköp inspires good meals. The
Hemköp operating segment also includes Tempo, a mini -mart format
comprising retailer-owned stores.
• Snabbgross is one of Sweden’s leading restaurant wholesal ers with a
customer base of restaurants, fast food operators and cafés.
Snabbgross offers personal service, accessibility and quality at its
stores and online. The Snabbgross operating segment also includes the
concept Snabbgross Club, which is directed at consumers.
• Dagab operates and develops the Group’s assortment, purchasing and
logistics, but also conducts sales to external customers. The Dagab
operating segment also includes retailer-owned Handlar’n and
Matöppet, the meal kit company Middagsfrid, the online pharmacy
Apohem and the restaurant chain Urban Deli.
Investment case
• The food retail market is relatively unaffected by economic swings and
is driven largely by population growth and inflation. Axfood has a clear
strategy for addressing the trends in the market through concrete
priorities in six focus areas. The goal is to grow faster than the market
with a long-term operating margin of at least 4.5%.
• To meet customers’ varying needs, Axfood is a family of different
concepts with strong market positions. With a clear expansion plan,
a focus on the customer meeting in physical stores and in e -commerce
as well as the development of meal solutions, customers’ evolving
behaviours in the market are being met.
• Economies of scale and cost efficiency are ach ieved through close
collaboration between the central functions and Group companies.
Dagab is the joint purchasing and logistics company, setting high
demands for price, quality and sustainability. Axfood’s common IT
company has a crucial role in the Group’s digital development,
automation and data-driven work approach to meet future needs.
• Axfood has a solid balance sheet, and the business model generates
stable cash flow with efficient management of working capital. During
the last five years, the dividend yield has been close to 4%.
• Axfood has long been working to be a positive force in society. Axfood is
taking the lead in promoting a sustainable food system, and innovative
and sustainable products are being launched through the private label
assortment.