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IKEA Posts Higher Profit Growth But Forced to Close 59 Stores Amid Fresh Lockdown Measures

Practice Stock Trading
Updated: 03 November 2020

Inter IKEA Group, which owns the iconic IKEA brand, said its pretax profit rose 13% to 2.02 billion euros in the 12 months through August to accelerate profit growth from 5% in the last year.

September sales fell by 4% to 39.6 billion euros amid the COVID-19 pandemic and temporary store closures, but the company says sales rebounded after reopening.

“Despite the economic and public health challenges posed by the COVID-19 pandemic, the company continues to accelerate its retail transformation, repurposing its stores to fulfilment units, implementing click&collect services, offering pick-up and drive-through options, developing a more seamless IKEA experience with new digital solutions, and in some cases even turning store car parks into COVID-19 testing facilities for the communities,” the company said in a statement.

Ingka said that as many as 59 of its stores across Europe have closed in October after fresh lockdown measures were introduced by national authorities. France leads the way with 35 store closures.

“The primary concern for IKEA is the health and safety of our co-workers and customers. As there are unique circumstances in the 30 countries where Ingka Group has stores located, evaluations and decisions are taken based on the local situation,” it is said in the statement.

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