EG Group profits boosted by foodservice and Asda On the Move stores

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Petrol forecourt giant EG Group has reported increases in profits and sales off the back of strong performances from foodservice, its grocery division and Asda On the Move store conversions.

Asda on the Move 4

EG is opening Asda On the Move stores across the UK

In the three months to September 30, group EBITDA climbed 10% to $470m (£391m), while total revenues jumped 23.8% over the quarter to $8.8bn (£7.3bn).

EG Group, which is owned by Asda co-owners Mohsin and Zuber Issa, reported that foodservice gross profits soared 21% year on year to $207m (£172m) for the quarter.

This was driven by acquisitions and new openings across Europe and the UK and Ireland, with a further 14 foodservice outlets opening over the quarter, taking the total to 1,895.

EG Group grocery and merchandise profits grew 5% for the period to $387m (£322m), which the group attributed to the positive impact of Asda On the Move store conversions and the opening of “new-to-industry” grocery sites.

Fuel gross profits rose by 25% during the quarter to $640m (£532m), driven primarily by growth in the US, but EG said this was largely offset by a significant increase in UK costs – with year-to-date overheads increasing due to labour, energy and logistics costs.

Zuber Issa said he was pleased with the third-quarter performance, “which again proves the resilience of the group against the prevalent global uncertainty”.

“During this period, the benefit of our geographic diversification was demonstrated as the performance of the US and Australian businesses offset the weaker UK trading, with significant cost headwinds in energy, labour and logistics costs that also impacted our other markets,” he added.

“Despite these macroeconomic challenges, we continued to deliver against our strategic objectives through our ongoing investment in non-fuel retail, driving further innovation and cost efficiencies with our major brand partners and, finally, strengthening our convenience store proposition with the ongoing rollout of Asda On the Move across our UK forecourt network.”

The update follows the publication of the group’s ESG report in October, which set out its net-zero ambitions and energy transition plans to lower-carbon fuels.

“We have been hugely encouraged by the initial trial of our ultra-fast chargers and infrastructure,” Zuber Issa said.

“Our disciplined rollout will see ultra-fast charging being made available at a further 20 EG sites by the end of this year and we are exploring a range of options to further accelerate this proposition.

“We are already seeing the benefits of combining EV charging infrastructure with our multi-service sites, which allow consumers to enjoy a meal or a cup of coffee, or shop for groceries, while they wait for their car to charge.”