The Netto discount chain was all that stood between retailer Spar and major losses in the first half of the year, the company has revealed. The performance in the first six months of the year was bad enough - total group turnover fell by just under 1 per cent to €3.21 billion, while operating losses plummeted a further 22.2 per cent to €60.9 million - but would have been far worse if not for the discount chain.
Turnover at Netto increased by 15.5 per cent in the first half, in part a reflection of the continuing difficulties facing the German economy which have prompted more consumers to buy their food at the lowest possible prices but also due to the perceived (and real) price increase caused by the introduction of the Euro, Spar said.
Things could not have been more different at the Eurospar hypermarket subsidiary, which saw its sales drop by 7.6 per cent during the half. Figures from the cash & carry business sold by Spar to Metro in May were included in the first four months of the year.
This move to return the business to its core operations - a number of wholly-owned stores and a large number of affiliated stores run by independent operators supplied by the Spar wholesale group - still has a long way to go before it restores the company to the black.
The recent flooding in Germany will not have helped either, with many stores damaged and consumers understandably spending less, but the group remains confident that it will turn itself around, encouraged by good like-for-like sales results during the first half and excellent growth at the 100 or so stores which have been converted from the Spar fascia to that of Intermarche, the French group which owns a controlling stake in the German company.