Income trend (sales trend) of Migros Group

The Migros Group posted income of CHF 24.9 billion, representing a decline in sales of 3.1 per cent. The Retail and Industry sector, with income of CHF 24.0 billion, recorded a drop in sales of 3.1 per cent. Lower prices of Migros products, sharply falling crude oil prices and a shrinking travel business had a major effect on Migros Group revenue. Sales volumes rose in the core retail business, but as Migros invested substantially in price reductions, a decline in revenue of 2.4 per cent resulted in retailing. Because of lower market interest rates, income in the Financial Services sector was down slightly by 2.9 per cent to CHF 992.9 million, while expenses from financial services (including impairment losses) declined by a much more significant 16.9 per cent.

Income trend (sales trend) in Retail and Industry sector


Income in Retail and Industry sector

  Total Income Change over previous year
in %
CHF million
Mio. CHF
Cooperative Retailing 15'695.2 15'777.1 -0.5 %
Commerce 5'869.7 6'213.2 -5.5 %
Industry & Wholesaling 5'021.8 4'967.8 1.1 %
Travel 1'631.1 1'941.4 -16.0 %
Others 385.8 392.0 -1.6 %
Eliminations (within Retail and Industry sector) -4'640.9 -4'555.9 1.9 %
Total Retail and Industry sector 23'962.7 24'735.6 -3.1 %

The activities of the regional Migros Cooperatives, the Federation of Migros Cooperatives and the services of the Group’s logistics companies are combined in the strategic segment Cooperative Retailing. The ten regional Cooperatives generated income of CHF 15.2 billion. This represents a decrease of CHF 165.8 million or 1.1 per cent over the previous year. Market share remained stable at 36.8 per cent. The decline in income for the supermarkets was 1.0 per cent. Volumes sold were greater than in the previous year, but price reductions on the total assortment of over CHF 300 million had a negative effect on revenues. Migros offers the best value for money as constantly confirmed by independent sources. Prices in the Fresh Produce segment were 3 per cent lower, Meat retailing prices were down by an average of 5 per cent and Fruit/Vegetables were 5.5 per cent cheaper than in the previous year. According to the BFS, the decline in the cost of living in Switzerland was 0.5 per cent in 2009. The specialist markets posted a 1.2 per cent increase in income to CHF 1.3 billion, despite a decline in prices of 3 per cent on average. As every year, the regional cooperatives ensured that sales areas remained attractive and customer-oriented by means of substantial investments in new or expanded stores. The weighted sales area increased by 2.0 per cent over the previous year while weighted area productivity decreased by 2.7 per cent due to the decline in revenue. Retail Migros in other countries posted sales of CHF 204 million, just under the previous year’s level. Migros has had an additional store in France since October 2009.

The strategic segment Commerce mainly includes the retail companies Denner, Migrol, Magazine zum Globus, Interio, Ex Libris, Office World and Le Shop. The decline in income by CHF 343.5 million to CHF 5.9 billion is mainly due to Migrol (because of the sharp fall in fossil fuel prices). During 2009, Denner posted income of CHF 2,763.0 million and is showing pleasing growth of 2.5 per cent in the fiercely contended discount business. This is mainly due to the company's expansion and differentiation efforts in the Fresh Produce area. The changeover to the new Fresh Produce concept was successfully completed in 2009. Migrol posted good sales growth in cubic metres in its fuels products with an increase of 4.3 per cent. However, revenue declined by 20.8 per cent because of the much lower prices of fossil fuels. Expansion of the new Convenience Store format Migrolino is making excellent progress. 136 Migrolino Shops were opened in the 2009 financial year, significantly more than planned. At year-end 2009, Migrol had converted more than 60 petrol station shops to the new format and is achieving much higher sales as a result. The cooperation between Migrol and Shell was very successful in its first year. Shell is already operating 50 Migrolino Convenience Stores at its largest Shell petrol stations. Globus did not quite match its very good result for the previous year, with an income of CHF 795.5 million (-1.0 per cent), despite area expansion. However, expectations were clearly exceeded. Globus was able to expand its market share in the fashion segments by further strengthening the fashion lines and extending its brand portfolio in ladies’ fashions. The converted men's fashion stores of Herren Globus are showing a very healthy trend. Ex Libris achieved the best Christmas business ever and equalled last year’s record results with income of CHF 193.2 million. The product mix, its close-to-the-customer stores, the revamped e-shop, attractive prices, customer trust and highly committed employees are the building-blocks for the success of the largest media provider in Switzerland. Le Shop can again look back on a very successful year. With annual revenues of CHF 131.5 million, the company grew by 17.7 per cent over the previous year. A regular customer base helped this continued growth. One third of these customers makes a purchase at Le Shop at least every two weeks. An increase was also achieved in average order value: Le Shop customers spent an average of CHF 228 (+2 per cent) per order. In a conventional supermarket the average purchase value is around CHF 33. The delivery service for frozen products which was set up in the year 2009 exceeded expectations.

The strategic segment Industry & Wholesaling includes, apart from 16 industrial companies also the two wholesalers Scana Lebensmittel AG and Mérat AG. With a 1.1 per cent increase in income for the segment, Migros Industry’s growth slowed somewhat compared with previous years in the difficult economic environment. The growth is due to good sales with third parties in Switzerland and with the Migros Group. Growth from third-party customers is mainly due to expansion of bulk consumer business. Export business came under considerable pressure as a result of the economic crisis and unfavourable foreign exchange effects, but was just able to hold the previous year’s level with growth in local currency of 0.5 per cent (-6 per cent in CHF). Currency losses in pounds sterling, euros and dollars compared to the Swiss franc had a substantial adverse effect on the result. The situation on the raw materials markets eased slightly in the 2009 financial year. Falling raw materials prices were passed on to customers in the form of lower selling prices, which led overall to a price decline of just over 1 per cent for the industry companies overall. Particularly strong growth of 6.4 per cent was achieved by the industry segment Meat, Fish and Poultry (Micarna, Mérat). In addition to product innovations, expansion of the Catering business and the takeover of meat production from a number of Cooperatives are paying off. With product innovations (accounting for a share of sales of just over 10 per cent) and a number of company acquisitions (Weisenhorn, etc.), industry companies contributed their part to the Group's strategic “Growth” initiative.

The strategic segment Travel registered 1,718,306 passengers in 2009, only a slight decrease compared to the previous year of 3.8 per cent. However, trips were shorter in duration, to destinations closer to home and also somewhat less luxurious, so that sales were down 16.1 per cent from CHF 1.9 billion to CHF 1.6 billion. The trend in the exchange rate of the pound sterling and the euro to the Swiss franc caused a further fall in sales of around CHF 87 million. The first financial year of the restructured Swiss organisation with the merged units Hotelplan and Travelhouse went well, while the new “Denner Reisen" and “Migros Ferien” brands surpassed their targets. The on-line travel agency achieved record sales. Hotelplan UK, with the “Inghams” brand, was doubly impacted by the financial crisis, since the pound sterling depreciated against the euro and holidays in continental Europe therefore became significantly more expensive. Interhome, the leading agent for quality holiday homes, was also noticeably affected by currency influences, but was able to hold sales at the previous year’s level despite the euro’s depreciation against the Swiss franc. The Italian subsidiary reacted very swiftly to the changed environment, but this was reflected in lower sales in the short term. The sales trend in the other activities is positive across the board, with all units able to increase their revenues.

Income trend in Financial Services sector

Income from financial services business amounted to CHF 989.4 million in the financial year with interest revenue totalling CHF 860.8 million or 87 per cent, constituting the main component of total income. Commission income amounted to CHF 89.2 million and financial assets and foreign exchange dealings generated a net profit of CHF 39.3 million. In the fiercely contended mortgage market, Migros Bank achieved growth in mortgage loans of CHF 721 million or 3.0 per cent due to the company’s advantageous rates. As a result of the financial crisis, Migros Bank achieved a net increase in customer deposits and liabilities of CHF 1,480 million or 6.2 per cent.