Belgium's biggest supermarket chain Colruyt expects a slightly higher net profit for this year. The retailer also said at its general meeting that it was not afraid of the increasing competition and that it would instead give Dutch Jumbo, which is expanding to Belgium soon, a "warm welcome".
Quite a few analysts and investors had expected a pessimistic forecast at Colruyt's general meeting, but nothing of the kind was shown. Instead, the retailer expects a slightly higher net profit for the current financial year - which ends in March. Last year, net profit amounted to 372 million euros. Colruyt did not give a forecast of gross profit.
The retailer's moderate optimism indicates that it is not afraid of new competitors such as Jumbo, the Dutch supermarket chain that will open its first three Belgian stores later this year and that aims for around a hundred Belgian stores in the long run. Jumbo's Dutch arch rival, Albert Heijn, also has plans for thirty to fifty new stores in Belgium.
"No threat to us"
According to operational director Marc Hofman, Jumbo is not a long-term threat to his chain, but says it may be a threat to some of his competitors. "We see the similarities with the arrival of Albert Heijn in Belgium a few years ago", he says in local business newspaper De Tijd. "At that time we saw a brief impact on our stores near Albert Heijn stores, but in the long run it did not hurt us."
Even after the arrival of Jumbo, Colruyt intends to remain true to its lowest price guarantee. CEO Jef Colruyt keeps to himself how the retail chain wants to further combat Jumbo: "I am not going to tell you, but we are ready. We will give them a warm welcome."