Shufersal Ltd. (TASE:SAE;Pink Sheets: SSLTF) today published its financial report for the third quarter of 2009. Israel's largest supermarket chain, with nearly 40% market share, saw flat revenue but a rise in net profit, as the recession and growing competition affected the company. The results were disappointing, as net profit missed analyst expectations.
Shufersal posted NIS 2.88 billion revenue for the third quarter down 0.5% from the NIS 2.89 billion for the corresponding quarter of 2008, but net profit rose 6.8% to NIS 63 million (NIS 0.30 per share) from NIS 59 million.
Shufersal missed the analysts' consensus of net profit of NIS 68 million, although it beat the revenue forecast of NIS 2.85 million.
Operating profit fell to NIS 125 million for the third quarter from NIS 147 million for the corresponding quarter.
The effects of the recession were seen in a 2-3% decline in the average purchase by customers, compared with the corresponding quarter. Additionally, an example of the intensifying competition in the sector is the launch of a buyer's club by rival Blue Square Israel Ltd. (NYSE: BSI; TASE: BSI). Retail sales dipped to NIS 2.87 billion from NIS 2.88 billion. Sales per square meter fell 1% NIS 5,710 for the third quarter from NIS 5,770 for the corresponding quarter.
Shufersal's income-producing real estate business generated NIS 15 million revenue for the third quarter compared with NIS 14 million for the corresponding quarter.
Shufersal is a unit of Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH), held through Discount Investment Corporation (TASE: DISI). Its share rose 0.9% in early trading on the TASE to NIS 17.85, giving a market cap of NIS 3.82 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on October 28, 2009
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