Lidl swings to loss following ‘significant’ investment on price

In the 52 weeks ending February 28, 2023, Lidl reported a loss before tax of £75.9m, compared with profits of £41.1m for the 2021/22 full year.

Sales for the period were up 18.8% to £9.3bn, while earnings before interest and tax slipped to £28.5m, down from £79m previously.

During the period, Lidl’s market share grew from 6.1% to 7.1% and it added more than 1.4 million new customers.

Lidl said its financial losses underlined its “significant investments in prices, colleagues, suppliers and future growth” over the period, highlighting the £100m it pumped in to keep prices low and the £50m in increasing minimum hourly rates for staff.

During the period, the discounter opened almost 50 new stores and said it acquired new sites for future expansion.

Chief executive Ryan McDonnell said: “We’ve always had a clear commitment to offer the best value to our customers and that is a promise we will always keep, even in uncertain economic times. Alongside preserving this price promise, rewarding our people and maintaining long-term relationships with our suppliers will always be a priority.

“As a privately-owned business we have the ability to make decisions that we know will have immediate benefits for our people, customers and suppliers, and long-term benefits for our business.

“The entire retail market has seen inflation and we are no exception. However, for us, what is important is that our price gap with the traditional supermarkets is as strong as it has ever been.

“We’ve invested in keeping our prices low for customers in what has been a very challenging year for most and, with many more customers flooding through our doors each day, our ambition is to ensure that every single household has access to high-quality, affordable food at their local Lidl store.”