Lidl has quadrupled its profits after expanding and enticing more customers in the past year, the supermarket says.
Pre-tax profits reached £41.1 million in the year to February 28, up 319% from the £9.8m recorded over the same period a year earlier. Revenues rose by 1.5% totalling £7.8 billion in the latest financial year, up from £7.7 billion the previous year.
Lidl opened 53 new stores in the year to February, by which it had 918 across Britain. Lidl, which was named the UK’s cheapest supermarket this month by The Grocer, stressed that it would continue to meet its promise to customers of offering the lowest prices in the market.
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Lidl has 770,000 more weekly customers compared to last year. Lidl puts this down to shoppers switching from 'Big Four' rivals like Tesco, Morrisons, Sainsbury's and Asda in a bid to save money. It has added £58m to Lidl's coffers.
But Lidl cautioned that supply chain pressures have increased the risk of sufficiently meeting customer demand, and that there is “no assurance” that the issues will not worsen in the future, which could further increase costs.
And the chain said it has been affected by labour shortages caused by Brexit and following the pandemic.
It also noted that it has seen a shift in consumer habits to more of a focus on healthy eating, which it said presents a risk as it needs to keep up with the trends and change its products to meet them.
Earlier this year Lidl released a list of 48 locations across the North East where it hopes to open supermarkets. In April, Newcastle City Council approved plans to build a new Lidl in Shieldfield, Newcastle.
Ryan McDonnell, Lidl Great Britain’s chief executive, said: “Our business model is built for the long term and I’m incredibly proud of our continued growth in recent months, which builds on our strong performance across 2021.
“During this time, we’ve made further investments across all areas of our business, building even more stores and distribution centres, hiring more colleagues, increasing pay rates, investing in our British supplier base and contributing to the communities we operate in.
“As a discount supermarket we are in the best possible position to support people through these challenging times, and it’s our absolute priority that we continue to do so.”
The group recently increased its staff minimum wage, from £9.00 to £9.30 per hour outside London and £10.55 to £10.75 within the capital, which benefits 19,000 of its around 27,000 strong workforce.
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