(Sharecast News) – Lidl GB has swung to a £76m annual loss, the German discounter confirmed on Thursday, as its rapid expansion and investment in pricing pushed up costs.
The grocer said revenues in the UK business jumped nearly 19% in the year to 28 February, to £9.3bn, while its market share rose to 7.1% from 6.1%.
Earnings before tax and interest fell to £28.5m from £79m, however, while pre-tax losses came in at £75.9m. Lidl GB posted pre-tax profits of £41.1m a year previously.
Lidl said it had invested £100m in keeping prices low during the year, and a further £50m in increasing staff pay. It also opened around 50 new stores during the period.
Ryan McDonnell, chief executive of Lidl GB, said: “We’ve always had a clear commitment to offer the best value to our customers and that is a promise we will always keep, even in uncertain economic times.
“The entire retail market has seen inflation, and we are no exception. However, for us, what is important is that our price gap to the traditional supermarkets is as strong as it has ever been.
Along with fellow German discounter Aldi, Lidl has seen its market share surge as hard-pressed shoppers seek out bargains amid mounting inflation and interest rates.
Both chains have also expanded rapidly in the UK in recent years, although they remain significantly smaller than larger rivals such as Tesco and J Sainsbury.
Lidl, which is owned by the family-controlled Schwarz Group, currently has around 960 stores in the UK.