Musgrave looks to chippers and foreign shores as profits jump

Cork-based wholesale and retail group reports rise in profit before tax of 38%

Musgrave will target an accelerated rollout of its chip shop brand Chipmonger. Photograph: Barry Cronin

Musgrave will target an accelerated rollout of its chip shop brand Chipmonger. Photograph: Barry Cronin

 

Musgrave, the owner of Centra and SuperValu, is eyeing further expansion supplying Ireland’s booming restaurant scene, as well as an accelerated rollout of its chip shop brand Chipmonger, as it seeks out options to grow the group’s sales of €3.7 billion.

The Cork-based wholesale and retail group released its financial results on Wednesday, with profits before tax up €20 million to €73 million, an increase of 38 per cent, across its 1,400 stores in Ireland and Spain.

The group’s reported sales were flat, although the company cited growth of 3.4 per cent after revenues were adjusted for currency and a period that was a week shorter due to a change in reporting dates.

The family-owned business is sitting on shareholders’ funds of €249 million and accumulated profits of €188 million.

At SuperValu, which includes franchises supplied by the wholesaler as well as the company-operated network of stores, sales were up 2.4 per cent to €2.7 billion. Recent Kantar figures show it is the largest grocer by share, with more than 22 per cent, vying with Tesco in second place.

Centra’s sales were up 3 per cent to €1.59 billion, while Musgrave’s Dialprix business in Spain and its MarketPlace wholesale business also showed growth.

Wholesale acquisitions

Chris Martin, the group chief executive, said Musgrave would look at any acquisitions that were available in the wholesale and food supply sectors, following its buyouts of CJ O’Loughlin and wholesale operations from DCC in recent years.

Musgrave also recently launched Chipmonger in three chip shops in greater Dublin, providing independently owned chip shops with a brand, which in turn buy stock from Musgrave. Mr Martin said it hoped to roll Chipmonger out to 30 outlets by the end of the year.

Its nascent export business has reached China since last year. It has a presence on Alibaba’s TMall online platform, where it sells some of its own-brand food products.

Mr Martin says it is examining how to introduce its export business to the Middle East, and it has also had discussions with other platform operators in China.

The group is also investing in its own online shopping system. Mr Martin said the market penetration for online shopping in London was 10 per cent, well over double the penetration in Dublin, proving there is room for further growth.