Mercadona has announced that it will give over a large chunk of its profits this year to fund its ongoing expansion.
Announcing a 4 per cent rise in net profit to €636m in 2016, the retailer said this year’s profit total would be around €200m, the rest going towards what it called it biggest capital expenditure in its history.
As well as new store openings, the company is improving its logistics network and expanding into Portugal.
“In order to invest in the future, it has been decided to sacrifice profits in the short term,” chairman Juan Roig said, adding that the strategy would continue into 2018.
During 2016 the retailer invested €685m in 50 new store openings, taking its total number of outlets to 1,614, as well as modernising a further 35 outlets and building a new distribution facility and data processing centre.
