The Board of ICA Gruppen has adopted the following long-term financial
Grow faster than the market
Good sales development and a strong market position are key factors in achieving and maintaining good profitability. This target applies to the Group’s grocery operations within ICA Sweden and Rimi Baltic, and to Apotek Hjärtat.
Due to a market climate of continued high inflation and a strong focus on price, ICA Sweden and Rimi Baltic did not reach the goal of growing faster than the market, but were instead losing market share until the end of the third quarter of the year. Apotek Hjärtat did, however, reach this goal and managed to strengthen its market-leading position in the Swedish pharmacy market. Apotek Hjärtat’s market share increased both in physical pharmacies and online.
Achieve an operating margin excluding items affecting comparability of 4.5%
The target level provides room for investments and a return on invested capital, and is at a good level for the industry. The target is measured excluding items affecting comparability.
The outcome was the same as the previous year, 4.3% (4.3). This outcome is explained by mixed earnings effects in the Group’s various businesses, with ICA Sweden having a lower margin, while earnings growth for Apotek Hjärtat, Rimi Baltic and ICA Bank resulted in a stronger margin. The effects of IFRS 16 Leases were more positive than the previous year and excluding these the operating margin was slightly lower than 2022.
Achieve a return on capital employed of 7.5%
The target level indicates that the Group is using capital effectively. ICA Bank is not included in the calculation because banking legislation stipulates that its assets and liabilities are not available to the Group. Instead ICA Bank has a target for return on equity that is a more appropriate target for banking operations.
The outcome was 9.2% (9.1). The Group’s operating profit and financial income were higher than the previous year and the average capital employed increased by around SEK 1.8 billion. The year-on-year changes in the various components of working capital linked to the merger with Murgröna in November 2022 are substantial. This includes substantial changes in equity and in the Group’s loan structure including lease liabilities.
Net debt excl. ICA Bank and IFRS 16 Leases/EBITDA excl. IFRS 16 Leases <2.0
A good balance between earnings and borrowing gives the Company the freedom and ability to act, even in times of recession.
The debt ratio decreased in 2023 from 3.3 to 2.2. This is explained on the one hand by stable earnings growth and on the other by strong cash flows as well as property divestments which reduced the net debt. EBITDA includes capital gains and without these the debt ratio would be 2.6.