Release Date: July 15, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Axfood AB AXFOF delivered positive growth and increased earnings despite a challenging market characterized by food price deflation.
- The company reported a stable gross margin trend and effective cost control, contributing to improved profitability.
- Hampshire demonstrated strong performance with retail sales growth of more than 7%, driven by high volumes and increased customer traffic.
- Axfood AB (AXFOF) continues to invest in sustainability, with significant progress in electrifying its vehicle fleet and launching new sustainable products.
- The company maintains a strong strategic focus on operational efficiency and sustainability, leveraging new technology and data to optimize logistics and reduce costs.
Negative Points
- Market growth was negatively impacted by food price deflation and a reduction in VAT, leading to a lower growth rate compared to previous quarters.
- Retail sales for Axfood AB (AXFOF) increased by only 2.1%, which did not meet the company's growth ambitions.
- Deflation and higher fuel costs negatively impacted earnings, with a reported cost of 40 million CIAC due to increased fuel prices.
- Citigross faced challenges with negative like-for-like sales growth, partly due to store closures and price deflation.
- The company's cash flow was negatively impacted by the VAT cut on food, resulting in a cash flow from operating activities of minus SEK47 million.
Q & A Highlights
Q: Can you elaborate on the factors impacting Willis' growth in Q2 and any tactical measures being implemented?
A: Simone Margulies, President and CEO, explained that Willis faced high comparison figures from last year, growing over 10%. This, combined with price deflation, resulted in weaker growth. Tactical measures are being implemented to improve short-term growth, focusing on increasing store traffic without specifying the exact strategies.
Q: How are higher fuel costs affecting Axfood, and what is the outlook for the rest of the year?
A: Anders Lexmon, CFO, noted that the impact of higher fuel costs is contingent on developments in the Middle East and fuel price trends. The company will continue to monitor the situation and adjust accordingly.
Q: What are the efforts to reverse the sales trend at Citigross, and how is deflation impacting it?
A: Simone Margulies stated that Citigross is focusing on attracting customers and driving volume for profitable growth. The sales decline is partly due to store closures and price deflation. The company is following its plan to improve profitability and aims to achieve profitability in the second half of the year.
Q: Are there any changes in consumer preferences, and how is the Willis 5.0 store concept performing?
A: Simone Margulies mentioned that while price awareness remains strong, there is increased growth in sustainability-labeled products and fruits and vegetables. The Willis 5.0 concept is performing well, with modernized stores showing positive results and attracting new customers.
Q: How is the VAT cut affecting cash flow and working capital?
A: Anders Lexmon explained that the VAT cut negatively impacted working capital by approximately 50% of the SEK 700 million effect in the first six months. The impact will reverse if the VAT is reinstated.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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