Last year’s collapse of Palmer & Harvey has contributed to a huge increase in Nisa’s fourth quarter sales figures.
For the 13 weeks to 1 April, Nisa’s sales rose to £377m, up by more than 26% compared with the same period last year. The demise of P&H meant that Nisa serviced 1,039 new sites in the fourth quarter, with a further 76 stores recruited to its core business. Like-for-like sales during the quarter were actually down by 1.1% - although they improved into positive territory (0.5%) for the last six weeks to 1 April – due to “extremely challenging” market conditions, according to interim ceo Arnu Misra.
The complete year-end results are still subject to audit, but the group’s board is expecting to post higher EBITDA than last year, with reduced debt and improved cash reserves.
Misra said: “Following a very strong Christmas period, our sales and recruitment numbers have continued to perform strongly, giving Nisa positive momentum as we enter our new financial year. I am also pleased to report that during a quarter of increased stores growth, we were able to generate cash without significantly impacting service to our existing members. Nevertheless, market conditions continue to be extremely challenging, and Nisa remains focused on ensuring its members are best placed to serve their customers and communities for the long term.”
Taking out the effects of servicing Costcutter stores left without supply following the P&H collapse, and also the expected departure of 264 McColl’s stores due to a new supply deal, the group recruited 76 new stores during the period but lost 73.
The board is confident that store recruitment will increase after the conclusion of the CMA investigation into the Co-op Group’s proposed takeover of Nisa. Misra commented: “There is a great deal of interest in what we can offer, but people are understandably going to hold onto their investment decisions until we have more certainty.”
Chief financial officer Robin Brown added: “We have a track record of being to scale up or scale down the number of stores we supply according to market conditions without further capital investment. We are the best in the market at this kind of flexibility.”
The latest version of Nisa’s Store of the Future2 format was on show at the group’s annual exhibition in Stoneleigh this week, featuring enhanced food to go modules including a seating area. More than 340 stores have been converted to the new concept, delivering average trading increases of 6%, according to Nisa.
In addition, the Group’s Making a Difference Locally charity scheme is celebrating its 10th anniversary this year. More than £7m has already been donated to good causes through the programme, which raises funds through the sales of designated products.