Poland's Eurocash bets on promotions as consumers cut back (updated)
28/03/2023 11:48
(Adds CEO quotes and background)
GDANSK, March 28 (Reuters) - Poland's largest wholesale
consumer goods distributor, Eurocash EUR.WA , is stepping up
promotions as consumers rein in spending amid high inflation,
its chief executive officer Pawel Surowka told a conference call
on Tuesday.
The comments came after Eurocash reported a net profit of
67.1 million zlotys ($15.52 million) for last year. That
compared with a loss of 113.6 million zlotys a year earlier, and
sent the company's shares up by more than 10% in morning trade.
"There is definitely trading down. We can also see that
consumers are buying less and that's noticeable in the volumes,"
Surowka said.
"We are currently making sure that we have much more
aggressive promotions. We are also investing heavily in our own
brand capacities and having very honest and tough negotiations
with our suppliers," he added.
Eurocash's revenues rose a little over 17% last year to
30.86 billion zlotys. Its operating result increased to 403.7
million zlotys.
Surowka said 2022 was "extremely complex in many ways. It
was marked by war in Ukraine, the energy crisis and high
inflation".
This year, the wholesaler wants to focus on further
developing digital tools for its clients. It also plans to
introduce a loyalty programme for customers of its ABC, Groszek
and Euro Sklep chains.
($1 = 4.3229 zlotys)
(Reporting by Patrycja Zaras, additional reporting by Maria
Gieldon, Editing by Louise Heavens and Mark Potter)
((Patrycja.Zaras@thomsonreuters.com;))