Ikea profits fall despite sales rise

Ingka Group, the holding company that runs Ikea posted a fall in operating profit to €2bn (£1.7bn) during the year to the end of August.

However, the group’s sales increased 5.3% to €39.1bn (£33.5bn) and pre-tax profits jumped 19% to €2.5bn (£2.49bn) due to a rise in income from financial investments.

Ikea profits fell 10% during the same period as the homeware retailer ramped up its spending in renewable energy and growing its online business.

The retailer’s online sales soared 50% and in-store sales registered a 0.7% uptick.

Since 2009 Ikea has invested nearly €2.5bn (£2.1m) into renewable energy. It now owns 534 wind turbines and 715,000 solar panels across 14 countries alongside 920,000 solar panels on its store rooftops.

Ingka Group deputy chief executive Juvencio Maezt said: “We want to be a part of creating solutions for the challenges our planet is facing, and we are taking bold steps securing our ambition to become climate positive by 2030.

“It is even clearer that financial performance and sustainability go hand in hand, and for us, this is how we will grow, stay relevant and remain profitable long term.

“We will continue to test and try new things. At times we will fail and that’s OK, as that’s part of how we constantly develop and improve our business to better meet the needs of our customers for many years to come,” he said.

Ingka Group includes Task Rabbit, an investment arm and Ikea.