Axfood (AXFO) Q2 2025 earnings summary

Executive summary

• Achieved strong Q2 2025 growth, with net sales up 9.3% and retail sales up 22.9%, significantly outpacing the Swedish food retail market's 6.2% growth, driven by Willys, Hemköp, and Snabbgross.

• Increased market share and momentum in core chains, with City Gross contributing to hypermarket segment presence.

• Investments in automation, logistics, and efficiency, including the Bålsta logistics centre, enhanced competitiveness.

• Advanced sustainability initiatives, including Sweden's largest solar park and a 20% reduction in transport emissions.

• City Gross transformation and integration continued, with high activity and ongoing restructuring.

Financial highlights

• Q2 2025 net sales: SEK 22,995m (up 9.3%); retail sales: SEK 20,282m (up 22.9%).

• Adjusted operating profit rose to SEK 959m (up 14.7%); adjusted operating margin at 4.2%.

• Operating profit included SEK 25m in items affecting comparability, mainly related to City Gross.

• Cash flow from operating activities in Q2 was SEK 1,929m, supported by positive net working capital.

• Net profit: SEK 622m (up 6.9%); EPS before dilution: SEK 2.85 (up 6.3%).

Outlook and guidance

• 2025 outlook unchanged; focus on continued expansion, operational efficiency, and sustainability.

• Plan to open 10–15 new Group-owned stores in 2025, with six Willys stores opened YTD.

• City Gross expected to reach profitability in H2 2026; 2025 profit impacted by SEK 100m in structural costs.

• Efficiency initiatives to yield SEK 80m in annual cost savings from 2026.