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Aldi to invest $1.8 billion to accelerate growth in Britain - Financial Markets Worldwide

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ReutersStock Markets7 minutes ago (Sep 27, 2021 04:26AM ET)

© Reuters. FILE PHOTO: Abdelaziz Abdou, a Deliveroo delivery rider, poses with a bag of Aldi groceries in London, Britain, June 17, 2020. Picture taken June 17. REUTERS/Toby Melville/File Photo

LONDON (Reuters) -The British and Irish arm of German discount supermarket group Aldi will invest 1.3 billion pounds ($1.8 billion) in its business over the next two years as it attempts to accelerate its growth in market share, it said on Monday.

The retailer plans to open another 100 new stores in Britain, expand its logistics infrastructure, including a new distribution centre in central England, and invest in technology.

It said it expected to create more than 2,000 new British jobs next year, adding to the 7,000 permanent roles created over the past two years.

Aldi and German rival Lidl have grown rapidly over the last decade, forcing Britain’s big four supermarkets of Tesco (OTC:), Sainsbury’s Asda and Morrisons to cut prices and compete more aggressively.

However Aldi’s market share edged lower during the COVID-19 pandemic, partly due to a lack of a significant online business. It is Britain’s fifth-largest supermarket group, with 920 UK stores and an 8% market share.

The group, privately owned by Germany’s Aldi Sud, said 2020 sales rose 10.2% to a record 13.5 billion pounds but operating profit fell 1.2% to 287.7 million pounds, reflecting the costs of COVID-19.

CEO Giles Hurley said the firm had to deal with “some of the most difficult conditions our sector has ever seen”.

The COVID-19 crisis has prompted the group to accelerate its push into home delivery via a partnership with Deliveroo. It has also introduced a click-and-collect service that’s now live in 200 stores, and is trialling a checkout-free concept store in Greenwich, southeast London.

($1 = 0.7311 pounds)

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