Musgrave, the retail symbol group that owns brands including SuperValu and Centra, is targeting growth in the food service and digital markets. It is also in discussions with developers about possibly building more stores in Dublin.
The Cork-headquartered, family-owned group released annual results on Tuesday that showed group revenues steady at €3.7 billion, and profits up 9% to €80 million.
Chris Martin, the chief executive, described them as a “solid set of numbers”.
Mr Martin said he expects the group’s sales and profits to grow further in 2018. Brexit, however, remains a threat for Musgrave, whose network includes more than 300 stores in Northern Ireland. He said the group may look to hold larger stocks in Ireland of goods imported via the UK, but this is unlikely to require it to invest in more warehousing facilities.
Mr Martin revealed Musgrave, whose network of mostly franchised stores had retail sales of about €5.1 billion last year, has devised a new seven-year strategy to reposition its retail brands as food market offerings.
Food service elements
Many of its stores, Mr Martin suggested, will ultimately also comprise instore foodservice elements as well as traditional retail. The strategy is dubbed within the group as “Food Island”.
Musgrave is also developing a number of new food brands, as well as charting the expansion of others, such as Chipmongers, which is offered to independent chipshop owners.
Mr Martin said the Chipmongers brand will grow from 10 to 30 outlets in Ireland by the end of the year, including by rolling it out as a concession within its Daybreak retail network, which has 217 stores in Ireland.
“The long-term ambition is to get Chipmongers to 70,” said Mr Martin.
Musgrave, which last year bought the La Rousse Foods hospitality industry supplier from Aryzta, is targeting more acquisitions in the sector. There is nothing specifically “on the table”, however.
In the burgeoning Dublin market, Mr Martin said it was exploring the possibility of building more stores.
“We are excited by the Dublin market. We are having discussions with a number of developers,” said Mr Martin. “We see opportunities for growth and new stores.”
He said Musgrave would explore the possibility of redeveloping some of the sold Superquinn outlets it acquired in the capital – all rebranded since 2011 as SuperValu – on a “case-by-case” basis.
Mr Martin said that above 50% of its more than €80 million capital expenditure over the year would go towards digital initiatives.
It is developing apps to facilitate paying for goods via mobile phone, as well as upgrading SuperValu’s digital operation.
Musgrave is also hoping to grow its goods exporting business. It has dipped its toe into the Chinese market, with a range available on an Alibaba ecommerce site. It also supplies Alosra, a Bahrain supermarket group.
Through this arrangement, it may also supply stores in the future in Saudi Arabia, if Alosra moves into that market.
Mr Martin said Musgrave is expecting growth in its 81-strong Dialprix network in Spain, but it is unlikely to make acquisitions there.