Iceland - comment

Iceland have just released their Q3 numbers, with a conference call to follow at 2 pm.  Iceland continues to grow volume, up 8%, giving up a little gross margin in return for more market share. COGS is driven by wage inflation, higher operational costs on higher volume and some above-the-line marketing expenses. The higher sales, slightly lower margins negate each other, with pre-IFRS 16 EBITDA remaining flat versus the prior year.

The new Warrington depot has started deliveries, four weeks later than originally scheduled and at a higher cost.  But similar to Q3, Iceland are managing to achieve volume growth which will absorb the higher costs.  Pre-IFRS 16 EBITDA in Q4 will be higher than last year’s and will be broadly flat year on year over FY25 as a whole.  Iceland have fully repaid the 2025 bonds, ahead of schedule.