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Iceland unfazed by sales slowdown Friday, 12th October 2012
Frozen food specialist Iceland came out on fighting form this week, reiterating its commitment to sales growth in the long term, despite a forecast fall in annual earnings.
As rival retailers increase their focus on value and price matches, Iceland has seen increased competition from discount grocers keen to tap into its round-pound pricing and money—off coupon strategies.
According to Retail Week, like-for-like sales at Iceland fell 0.2 per cent in the six months to the end of September.
During the 53 weeks to the end of March like-for-likes rose 6 per cent, but the grocer’s full-year target now lies flat for like-for-like comparisons, beneath a previously forecast 3 per cent rise. Retail Week reported that EBITDA is now likely to fall from £230.2 million in 2011 to between £215 million and £220 million in 2012/2013.
Speaking at a staff and investor conference in Dublin earlier this week, Retail Week reported Iceland chief financial officer Tarsem Dhaliwal told store managers:
“We have been riding a rocket ship. Every year we have increased our profits without fail.
“We had our arse kicked by the other food retailers [in the past six months]. They stole our customers’ food spend. We cannot take the credit and then hide in the shadows when things go wrong...Iceland is still a highly profitable and highly cash-generative business.” Dhaliwal added.