Finland’s S Group reports half year sales growth of 7.3%

‘These are times when the strengths of a co-operative are highlighted: competitive prices, the benefits of co-op membership and success in the product and service range’

Finnish retail co-op S Group has reported a pre-tax sales growth of 7.3% to €6,888.3m for January–June 2023, wth a combined operating result of regional cooperatives and SOK Corporation of €149m, a rise of €83m year-on-year.

Hotels and restaurants grew most, it added, with the post-pandemic increasing trade by nearly 24%, while its groceries business continued to outperform the market.

Supermarket trade excluding taxes amounted to €5,073.5m, it said, rising 9.4% on the same period last year, helped by warmer weather boosting the sales of cold drinks and ice cream. Sales at S Group’s food service company Meira Nova Oy also grew faster than the market.

“Alongside the strong recovery of hotels and restaurants, the positive increase in sales in practically all operations driven by higher customer volumes helped improve our operating result,” said SOK CEO Hannu Krook. “These are times when the strengths of a co-operative are highlighted: competitive prices, the benefits of co-op membership and success in the product and service range and network modernisation attract consumers. This is particularly reflected in grocery trade.”

S Group’s travel and hospitality business trade grew by nearly 24% in January–June compared to the previous year, reaching a total of €383.1m. Overall, the sales of hotels and restaurants in the first half of the year almost reached the pre-Covid level of 2019. 

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“We have made long-term investments in our hotel and restaurant network all over Finland,” said Krook, “and our customers have welcomed the upgrades. Fast food in particular has become more popular, and various work-related events have been in high demand. Likewise, domestic travel saw healthy demand in the first half of the year, even though reservations are considered very carefully due to the economic situation. Finland is also an interesting destination for foreign tourists.”

S Group’s service station shop and fuel sales fell 5.3% to €1,040.1m, reflecting a fall in fuel prices. Sales at ABC service stations’ restaurants and other services grew in January–June thanks to increased road traffic and the revival of public events.

Car wash sales were also in demand in the first half of the year. Electric charging sales grew more than fivefold year on year thanks to the growing ABC charging station network and the increasing number of electric vehicles on the road. 

S Group’s department store and speciality goods sales reached €122.3m, growing 6.1% year on year. 

The co-op’s investments grew from the previous year by more than €50m, amounting to €309m for the half-year, distributed evenly between different parts of Finland and targeted at the development of the service network, online shopping, digital services, and energy efficiency.

During the first half of the year, a record-breaking amount of €213m was paid to co-op members in bonuses, up by roughly €20m from the previous year, says the co-op. A new record was also reached in the number of summer employees, as roughly 17,000 young people gained work experience at regional co-operatives and other S Group businesses.