Retailer Coop Denmark announced its annual results, with a net profit of DKK 585m (£66m; €78.6m).
While this is a 24% decline from the DKK 777m reported in 2020, it is an increase from DKK 392m in 2019 – the pre pandemic year being taken as a benchmark by many retailers.
Meanwhile, turnover was up by DKK 1.5bn, from DKK 44.5bn (£5bn; €5.98bn) to DKK 46bn (£5.2bn; €6.18bn) excluding VAT.
The co-op said 2020 had been “an extraordinarily good year due to the special circumstances surrounding Covid-19”. The figure for 2021 “is a satisfactory result that reflects that it has become everyday in the grocery trade again,” it added.
Chair Lasse Bolander said: “In 2020, the borders were closed, most people worked at home and the restaurants were not open – as you know, this gave a headwind for the grocery trade. So it is natural that we do not continue at the same high level. The result for the year is also affected by the massive investments in the digital transformation of the company and the roll-out of [budget chain] Coop 365discount.”
Coop Denmark, also saw an increase in the number of members, with 48,633 signing up in 2021. Its 1.9 million members received DKK 283m in dividends in the form of bonuses, which can be used directly as payment in stores and online.
Throughout the year the co-op also continued its efforts to become “Denmark’s most sustainable company”. Initiatives included entering installing 500 electric charging stands at its stores throughout Denmark and developing a fleet of 23 electric vans and an electric truck (the first in the country). Since 2019 Coop Denmark’s solar panels have generated electricity corresponding to the annual consumption of 730 households.
Coop Denmark expects the year ahead to be “very challenging” due to rising purchase prices, the rapidly growing cost of energy and the changing behaviour of consumers towards smaller and cheaper grocery purchases. The retailer warns that 2022 profits will be ‘significantly lower’ as a result.
“We are sticking to our long-term strategy. But here and now, the war in Ukraine and the very extensive price increases we are receiving from our suppliers mean that we are slowing down because visibility has deteriorated,” said CEO Kræn Østergård Nielsen. “Everyone is affected by the rising costs. We believe that we can best help Danes promote cheaper alternatives without compromising on quality.”
Mr Nielsen said the co-op would focus on rolling out its new large discount chain, Coop 365discount, which was first launched in 2010. Coop 365discount is expected to consist of over 200 stores by the end of 2022 from 100 at present.
Another priority will be offering cheaper and more responsible product lines. Coop Denmark plans to combine its economies of scale with local ownership, where each store is adapted to the needs of local customers.