Profits with discount supermarket chain Aldi dipped slightly over the course of the last financial year as the chain announced a £300m refurbishment programme for its stores.
The British arm of the low cost store posted another year of record sales despite its profits being by the supermarket price war.
Regardless of what competitors may say or do, our price advantage will be maintained and our customers will always pay the lowest grocery prices in the UK.
The cash will be used to spruce up its fixtures for beers, wines and spirits and fresh produce, as well as a new “food to go” feature, with more than 100 stores to be refurbished in 2017.
Chief executive Matthew Barnes said the move was the result of a “listening exercise” involving more than 50,000 shoppers, adding that the firm’s investment plans have been “unaffected” by the UK’s decision to quit the European Union.
At present Aldi has 69 stores across Yorkshire and the Humber and a regional distribution centre in Goldthorpe, just outside Barnsley. In total it employs 3,100 staff in Yorkshire and Humberside.
The German-owned firm added that it will open 70 new stores in the UK next year as part of plans to increase supermarket numbers from 659 to 1,000 by 2022.
Sales grew by 12 per cent to £7.7 billion in 2015, with Aldi doubling its turnover in just three years. The company confirmed like-for-like sales were in positive territory, although Mr Barnes admitted they had slowed.
Operating profits dipped 1.8 per cent to £255.6 million, which the firm put down to its “continued investment in prices”.
Mr Barnes said the firm would continue to invest in prices in order to maintain a “significant price advantage” over rivals, flagging that Aldi has cut prices on 30 per cent of its products this year.
“Regardless of what competitors may say or do, our price advantage will be maintained and our customers will always pay the lowest grocery prices in the UK,” he said.
He vowed to “ride the storm” created by the supermarket price war, triggered by Aldi and fellow German supermarket Lidl, which has embroiled the sector, hitting margins at all of the so called “Big Four” players - Tesco, Asda, Sainsbury’s and Morrisons.
Aldi said 761,000 new customers walked through its doors last year, helping its market share grow to a record high of 6.2 per cent.
Mr Barnes said that Aldi’s online operation, which was launched in January, is seeing 11,000 orders per week, ahead of expectations. The chief executive said that online has proved particularly popular in London and the South East, which accounted for a quarter of all orders.
Aldi also pledged to make “substantial investments” in enlarging two existing distribution sites, redeveloping its UK head office in Atherstone, Warwickshire, and opening a new distribution centre in Cardiff next year.
Aldi said its strongest-performing categories last year included fresh meat and fish and its Exquisite wine range, while sales of its Mamia nappies grew by 29 per cent, making it the UK’s second biggest-selling brand.
Mr Barnes added: “We’re doing what I have always said we would do – investing our margin to maintain a significant price advantage over our competitors, keeping Aldi the lowest-price supermarket in Britain with outstanding quality products.
“This is the secret behind the bond we enjoy with our customers and it is why people keep coming back to Aldi, time and again. Regardless of what competitors may say or do, our price advantage will be maintained and our customers will always pay the lowest grocery prices in the UK.
“During the past five years we have invested close to £1.7bn in the UK by opening more stores than any other supermarket and enhancing our distribution capabilities. Our future capital expenditure plans are unchanged – we will continue to make significant investments in our business - paying our employees more than any other supermarket, treating our suppliers fairly and delighting our customers daily with outstanding quality products at unbeatable prices.”
Last year, the business invested £536.2m of capital expenditure in opening new stores and improving its distribution network in the UK and Ireland.