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Trade: KeysFin: the turnover in food retail in Romania, estimated at almost 125 billion lei this year
The turnover in food retail in Romania should reach, this year, almost 125 billion lei, after in 2019 the estimates show the surpassing of the value of 112 billion lei, according to a recent analysis made by KeysFin. According to the official data, at the level fo 2019, the first players in the food retail industry contributed with almost 660 million lei to the state budget, which is 42% of the total of 1.6 billion lei in the industry.
Similarly, the biggest ten companies in food retail had a cumulated turnover of 57 billion lei, generating over 53% of the total turnover made in the industry. The leader of the food retail market still is Kaufland Romania SA with a turnover of 10.9 billion lei and a market share of over 10%. The German company is the biggest profitable player on the market, with a net profit of 788 million lei, 18% higher than in 2017 and at the same time, the biggest contributor to the state budget, with 233 million lei in 2018.
The hierarchy in the food retail, according to the turnover is completed with Lidl Discount, Carrefour Romanian SRL, Profi Rom Food SRL and Auchan Romania SA.
According to KeysFin, the food retail industry had over 229,000 employees, in 2018 out of whom the most worked for Profi Rom Food SRL, 13,578 employees respectively. ‘The growth of food retail business was accompanied by the accentuated evolution of profitability.In 2018, the net profit of companies in the area had a growth of 8% in comparison to the previous year and was 224% higher than in 2009, with almost 3.8 billion lei. The first five players registered together a net profit of 1.8 billion lei, which constituted 47.5% of the total, in 2018. The net result (profit minus net loss) improved considerably at a loss of over one billion lei in 2011, at a positive net result of 2.6 billion lei registered at the level of 2018’ the quoted source says.
The Keysfin specialists show, on the basis of the centralized official data that out of the almost 55,000 analysed companies, fewer than half 23,900 (43%) got profit, 20,300 (37%) being under and the rest with an even balance result in 2018.
As regards the number of companies in the food retail, this dropped by 2.2% as compared to 2017, and with 14% against 2009 getting to 54,900 companies. The KeysFin analysts estimated that the consolidation process of the industry continued in 2019, and the COVID-19 pandemics will contribute to its accentuation this year. ‘The food retail will be at aggregated level one of the sectors the least affected by the pandemics with Pharma, health&social assistance, IT&C, agriculture (but dependent on weather conditions) and energy&gas distributors and those of water&sanitation ones.
As regards the increased demand for food, as a result of the coronavirus pandemics, from the data of the Competition Council, according to the Price Monitor, quoted by KeysFin, in March, salami, fresh tomatoes, milk and apples got more expensive. Thus, if a milk liter was 3.94 lei in December 2019, it got to 4.95 lei on 23rd March 2020.
‘The big retailers reacted rapidly at the clients comments regarding the increase in price and had anagreement to cap the prices for basic products. The first was Carrefour Romania which announced that they capped prices for 500 basic products up to Easter, being followed by Mega Image’ the quoted source says.
The KeysFin analysis relies on the annual financial data, unadjusted, aggregated, reported by the companies to the ministry of public finances (at the end of the period) with the main domain of activity: common food wholesale, drinks and tobacco, retail in non-specialized shops with food commerce mainly, drinks and tobacco, fruit and vegetable retail, in specialized shops.