Ikea’s profits have fallen by more than a third as the world’s biggest furnishing retailer invests in improving its online business and tests smaller city-centre stores.
Ingka, the holding company that runs the vast majority of Ikea stores, said pre-tax profits for its main operations were down 36% to €2.1bn (£1.8bn) and sales rose 2% to €37bn in the year to 31 August. Retail sales rose 4.7% in constant currency as the company opened 12 stores, including its first in India, alongside a 45% jump in online trade.
During the year, the group invested €2.8bn, the majority of which funded 14 new distribution centres to cater for online business. It also bought windfarms in Finland and Portugal and forests in Latvia and the US, as part of its sustainability efforts, and acquired the odd-job gig economy app TaskRabbit.
