Lower Q1 profits for Axfood

The Swedish food retailer Axfood AB posted a decline in first quarter net profits which amounted to 161 million Swedish crowns, down from 168 million crowns for the same period last year. Net sales rose to 6.82 billion crowns from 6.65 billion crowns, while operating profit fell to 226 million crowns from 242 million crowns.

Axfood said the lower profit was due to the early Easter holidays. The operating margin dropped to 3.3 per cent from 3.6 per cent. Axfood expects profits in 2006 to remain at par with the figures posted in 2005. Axfod also disclosed plans to merge its two chains Willys and Willys hemma to streamline operations and ensure efficiencies. “By integrating Willys hemma into Willys, we will be able to lower costs and ensure operating efficiencies,” said Axfood CEO Anders Stralman.