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Italian supermarket chain Esselunga: higher turnover, lower profits

Coles: strategic partnership with Microsoft

Holland: Plus sees 5.4% growth in consumer sales in first half
Dutch retailer Plus has reported a 5.4% year-on-year growth in consumer sales, amounting to €1,299mln, in the first half of its financial year. The retailer's market share increased to 6.5% during the period from 6.4% in 2018. It witnessed a 4.4% market growth in the first six months of its financial year, according to a Nielsen report. Managing director of the retail chain, Duncan Hoy, said that the company demonstrated a "strong national formula" in the past six months that was supplemented by passionate, local entrepreneurship to create "a winning combination". "The further roll-out of the 'Briljant 2.0' formula, the introduction of our Low Stayers, and growth of the e-commerce activities are bearing fruit [...] and is reflected in the increase in turnover and market share", Hoy explained.

Germany: Aldi Süd and Nord to align private label sourcing
According to Lebensmittel Zeitung, Aldi Nord and Aldi Süd in Germany are set to align the sourcing of their private label brands by the end of 2020. In Germany, the two companies already work together. Aldi Nord and Aldi Süd started joint discounted price campaigns on branded products in January 2019. The two companies also work closely on sustainability and on the reduction of plastic packaging. Aligning their private labels will allow both companies to potentially offer lower prices to shoppers and increase their competitive position against other retailers, especially Lidl. Both discounters will be able to join forces to organise common and more effective promotions and marketing campaigns. It will also end the confusion for shoppers when travelling to different parts of the country.

Belarus supermarket chain raises 70mln euros on Moscow bond market
Eurotorg, the largest food retailer in Belarus, has raised around 5bln Russian rubles (70mln euros) in its debut on the Russian bond market. The supermarket chain placed five-year unsecured bonds with a coupon rate of 10.95% on the Moscow Exchange. Demand was more than twice the offer size, at around 13bln Russian rubles, with investors placing more than 500 orders. “The successful pricing of our debut RUB-denominated bond represents another important landmark for Eurotorg”, said Andrey Zubkou, Eurotorg’s CEO. “Having achieved significant process in reducing our debt burden over the past year, we are continuing to look for ways to further optimise our overall debt profile. Adding RUB-denominated debt gives us an additional source of long-term unsecured financing. As a result of this issuance, we will have a more flexible repayment schedule and an increased average maturity of our debt portfolio.”

Chinese tech company seeks US$500mln to prepare for tough times
Tencent Holdings Ltd.-backed grocery delivery startup Missfresh is seeking up to US$500mln of new funding to help tide it over tougher times, according to people familiar with the matter. Beijing Missfresh Ecommerce Co., which also counts Goldman Sachs Group and Tiger Global Management as backers, is looking to fetch a valuation of at least US$3bln, the people familiar said, requesting not to be named because the matter is private. The company plans to raise US$300mln to US$500mln at a valuation of as much as US$4bln, one of the people said. The plans are preliminary and subject to change the people added. Missfresh declined to comment about the fundraising details in a text statement.

Grocery chain Lidl to install over 4,000 solar panels at distribution facility in Ireland
Supermarket giant Lidl is to invest 1mln euros ($1.12mln) and install 4,364 solar panels at a distribution facility being built in Ireland. In an announcement, the firm said that the solar panels would generate over 1mln kilowatt hours of energy per year, cutting the facility’s carbon output by around 473 tonnes. Lidl said the installation would represent Ireland’s “largest ever installation” of photovoltaic solar panels. Photovoltaic refers to a way of directly converting light from the sun into electricity. The solar panels will be supplied by Enerpower, a renewable energy business based in Waterford, Ireland.

Australia: Coles signs strategic partnership with Microsoft to transform its operations and drive deeper business insight
Coles has signed a strategic partnership with global technology leader Microsoft to accelerate its digital transformation, using cloud-based innovation to transform the shopping experience for customers, make life easier for team members and improve productivity across the business. This announcement is the latest in a series of global partnerships and developments through which Coles is building its technology and digital capability. The long-term strategic partnership is founded on Microsoft Azure becoming Coles’ cloud platform of choice, which will enable Coles to drive simplicity and efficiency in its operations by migrating its applications to Azure. Together with Microsoft, Coles is building an enterprise data platform in Azure that will power advanced analytics across Coles and enable the rapid deployment of artificial intelligence (AI) technology to drive innovation in physical stores and through the supply chain.

Wumart and Yonghui are in the final round of bidding to buy control of Metro’s business in China, sources say
Chinese supermarket operator Wumart Stores and an investor group backed by rival Yonghui Superstores are among suitors that proceeded to the final round of bidding for German food wholesaler Metro’s China business, people with knowledge of the matter said. Yonghui has teamed up with Hillhouse Capital, according to the people, who asked not to be identified because the information is private. Tencent Holdings is in talks to join their consortium, the people said. A group consisting of Meicai, a Chinese start-up that helps farmers sell vegetables to restaurants, and Hopu Investment Management have also been picked for the final round, the people said. A deal could value Metro’s China business at about US$2bln given the strong competition for the asset, the people said. The shortlisted bidders have been invited to submit binding offers in August, they said.

South Korea: Online grocery store launches early morning delivery service for vegans
Hello Nature, a South Korean online grocery store, launched an early morning delivery service for vegans who find it hard to buy vegan products in a country where a plant-based dietary lifestyle has been seen by many as fastidious. The grocery store said in a statement that it has opened "Vegan Zone", a special shopping category section for vegans, on its online shopping mall website. The vegan section provides a wide selection of products which do not contain animal substances. "In Vegan Zone, customers can buy a variety of vegetables, fruits and nuts, which are the main dietary products for vegans, as well as receive goods fresh and fast through eco-friendly early morning deliveries", Hello Nature's marketing director Park Jeong-hwan was quoted as saying.

Sweden: ICA store sales increase 1.6% year on year in June
Swedish retailer ICA Gruppen has reported a 1.6% year-on-year growth in store sales to SEK 10.7bln (€1.01bln) in June. Sales in like-for-like stores also increased by 1.6% year on year during the same period. Maxi ICA Stormarknad and ICA Nära saw like-for-like sales grow by 2.6% and 2.5%. Like-for-like sales in ICA Supermarket and ICA Kvantum grew by 1.0% and 0.5% respectively. Sales in January to June 2019 increased by 2.6% year on year and amounted to SEK 59.6bln (€5.6bln). The retail chain, which operates 1,272 stores, has estimated the calendar effect for June to be -1.8%.

Italy: Esselunga sees higher turnover, lower profits
Italian supermarket chain Esselunga has reported sales of €7.91bln in full-year 2018, an increase of 2.1% on the previous year. Growth was achieved without increasing shelf prices, despite an increase in costs by suppliers, the retailer said in a statement. Esselunga said that it has retained a leadership position in Italy in terms of value for money, with prices 3% below the market average. It has also continued to invest in promotional activities. Profits at the group fell 6.27%, from €305.8mln to €286.6mln, while net debt was €435.7mln (down from €847.5mln as of 31 December 2017). Capital expenditure amounted to €319.5mln, of which €290.4mln was invested in property, plants and equipment. The e-commerce segment continued to grow for the retailer, reporting sales growth of 28.3% to €236mln.

US: Ralphs eagerly returns to labor negotiations July 10-12
Ralphs Grocery Company returns to the negotiations table July 10-12 for meaningful and thoughtful discussions with the unions, to exchange proposals and come to a fair and balanced offer that benefits all 18,000 associates who choose to work for Ralphs. The company has a history of continuous investment in its valued associates through: Competitive wages; Premium healthcare benefits that cost associates $62 a month on average in premiums for their entire family's medical coverage; Generous pension benefits for retirement in a time when 93% of American companies do not offer a pension option. "As we have said all along, we are committed to continuing to invest in our associates - providing secure, stable jobs with competitive pay and benefits. We know our associates are the heart of our company", said Mike Murphy, president of Ralphs. "With a balanced approach this agreement can be a win for everyone - our associates, our communities and our company."

US: K-VA-T introduces unified point-of-sale system
K-VA-T partnered with ECRS to introduce Catapult, a unified point-of-sale system, to all of its Food City supermarkets. After testing the system in its Super Dollar stores and fuel centers, K-VA-T is the first company to introduce the technology in the grocery industry. The stores reduce operational complexity by using Catapult’s Transaction Logic software that serves and unifies all transaction points within the stores and online across the enterprise in real time. The software incorporates point of sale, direct payments, self checkout, pharmacy Rx integration, click and collect, smartphone checkout, scales, and fuel.

US: Teamsters vote to sanction potential California grocery workers’ strike
Teamsters Joint Council 42, in Los Angeles, has voted unanimously to sanction a possible strike that could affect more than 60,000 grocery workers in Central and Southern California who are represented by seven United Food and Commercial Workers International Union (UFCW) local unions. The move means that, in the event of a strike, the deliveries normally received by the affected stores will stop, meaning that even if the grocers hire temporary workers, the stores’ shelves will soon be bare.

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