Income Trend (Sales Trend)

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 business unit Cooperative Retailing. At CHF 14.4 billion, the ten regional Cooperatives more or less maintained the level of domestic sales achieved in the previous year (CHF -23 million, or -0.2%). Growth of CHF 43 million to CHF 1.2 billion (+3.7%) was generated in sales abroad. Total sales rose by CHF 21 million to CHF 15.6 billion (+0.1%). The domestic market share was 15.5%, up from 15.3% a year earlier.

In local currency terms, Migros France suffered a decline in sales of 0.9% year-on-year, to EUR 119 million. Tegut recorded sales of EUR 996 million (+1.5%) and increased productivity per area by a further 1.2%. With seven new store openings and eight store closures, the total number of markets at the end of 2016 was 272 (previous year: 273).

Migros supermarkets and hypermarkets generated domestic sales of CHF 11.7 billion (+0.2%, or CHF +19 million). With negative inflation across the Migros ranges averaging -0.3%, this corresponds to growth in real terms of 0.5% in the ten Migros Cooperatives.

The specialist markets Micasa, SportXX, Melectronics, Do it + Garden and OBI posted sales of CHF 1'602 million (CHF -20 million, or -1.2%). Adjusted for negative inflation of -3.6%, the five specialist markets together recorded growth of 2.4% in real terms. The sales trend in the online shops of the specialist markets remains positive, increasing by +12.8%. Following the successful launch of PickMup, the collection service from Migros for online orders, the network of collection sites was increased to 305. This means that 90% of the Swiss population is no more than a 15 minute drive away from a PickMup location.

Continued high demand for regional and sustainable products: Demand for regional and sustainable products, as well as products for allergy sufferers, continued to grow in 2016. The "Aus der Region. Für die Region." (From the region. For the region.) range continues to be extremely popular, posting a sales volume of CHF 940 million (+4.7%). Sales of products with ecological and social added value totalled CHF 2'854 million (CHF +176 million, or +6.6%), with highlights including a doubling of sales in Alnatura brand products in particular and year-on-year growth of 16.1% and 28.4% respectively in the sales of MSC and ASC fish products. Products bearing the aha! quality seal, which are particularly suitable for customers who suffer from allergies and intolerances, posted an increase in sales of 22.2%.

As part of Migros' sustainability strategy, a further five commitments were made to Generation M ("Generation von morgen" or "The generation of tomorrow") in 2016. In all of its activities, Migros looks for solutions with the right economic, social and ecological balance.

As every year, the regional Cooperatives made substantial investments in the construction of new stores and the renovation of existing ones. The Migros network of sales outlets increased by 26 in total to 685 sites at the end of 2016. The sales area for supermarkets, hypermarkets, specialist markets and catering services grew by a total of 19'821m2 (+1.4%). The productivity per area in supermarkets / hypermarkets in Switzerland totalled CHF 12'855/m2 (-1.7%), while the correspondng figure in specialist markets was CHF 3'820/m2 (-1.8%).

Sales in catering fell by 0.3% overall compared to the previous year, to CHF 682 million. Sales at the Migros restaurants decreased (-1.7%), as did those of Migros take-aways (-5.6%). In contrast, new catering formats such as Chickeria (+123.5%) recorded pleasing growth, while a sharp increase in sales (+16.8%) was also posted in community catering.

The strategic business unit Commerce mainly includes the retail companies Denner, Migrol, Magazine zum Globus, Ex Libris, Office World Group (OWiba), Interio, Depot (Gries Deco Group), migrolino, Le Shop, Probike and Digitec Galaxus (fully integrated on 1 April 2015).

Denner recorded an increase of 2.0% in sales to CHF 2'959 million, thereby increasing its market share further in the highly competitive retailing business. An increase in customers of 3.9% was reported in 2016. At the end of 2016, Denner had 809 stores (previous year: 797). By the end of the year, implementation of the "Fokus" store concept in 510 Denner stores was virtually completed. In order to adapt the design of Denner's satellite stores to that of its own stores, Denner will be modernising around 40 satellite stores per year over the next four to five years, with their name being changed to Denner Partner.

Sales of Migrol were impacted negatively by the continued sharp fall in the price of crude oil and the decline in fuel sales in regions close to the border as a result of the strong Swiss franc as well as the warm weather in the winter of 2015 / 2016. These decreased by 5.1% to CHF 1'290 million.

In a difficult market environment, Magazine zum Globus (including Schild) posted sales of CHF 879 million (-5.4%, like-for-like -2.1%) in 2016. Globus department stores recorded sales of CHF 658 million (-5.1%, like-for-like -1.5%), while the corresponding figures for Herren Globus and Schild were CHF 68 million (-3.4%, like-for-like -1.4%) and CHF 153 million (-7.3%, like-for-like -4.1%) respectively.

Ex Libris' sales fell by 7.3% year-on-year to CHF 112 million.

The Office World Group kept its sales steady at CHF 179 million (-0.6%) in the reporting year.

Interio generated sales of CHF 168 million (-7.6%) in 2016.

The retail chain Depot (Gries Deco Company abroad and in Switzerland) posted sales of EUR 460 million (+7.2%) or CHF 501 million (+9.8%).

migrolino generated sales of CHF 431 million (+13.0%). At the end of 2016, migrolino had a total of 307 shops (+20), including 59 sites and 248 service station shops.

Le Shop increased annual sales for the fourth time in succession in 2016, to CHF 182 million (+3.5%). One reason for this positive trend is the expanded service offering with more flexible time frames and a completely redeveloped online shop.

The French online market leader for bicycle accessories, Dolphin France SAS (Probikeshop), posted an increase in sales of 21.0% to EUR 69 million (in Swiss franc terms +23.9% to CHF 75 million).

In the 2016 calendar year, the online shop Digitec Galaxus generated sales of CHF 704 million (+41.1%; full integration of Digitec Galaxus as of 1 April 2015). 2016 saw the company withdraw fully from the wholesale business. In its private and corporate customer business, the company recorded the highest rate of growth in its 15-year history.

Thanks to the e-bike specialist m-way and its subsidiary Sharoo – a platform for using and sharing private and commercial vehicles – Migros has proven that it is also innovative in the field of alternative energy/sustainable mobility and in implementing new trends, such as the sharing economy.

In the e-commerce business, Migros further cemented its position as the undisputed market leader. Total e-commerce sales amounted to CHF 1'852 million (+15.8%) in nominal terms, with the main sales driver being Digitec Galaxus following its full integration.

Sales in the strategic business unit Industry & Wholesaling grew by CHF 134 million to CHF 6'389 million (previous year: CHF 6'255 million) in 2016. Its market positions were strengthened with strategic acquisitions in Switzerland and abroad. The international business (export and overseas locations) recorded pleasing growth of CHF 109 million (+16.0%) and generated sales of CHF 790 million. Business with Migros Group was increased by 0.9% to CHF 4'530 million. The market environment in the wholesale business was extremely challenging and sales decreased by 1.5% to CHF 1'069 million.

The strategic business unit Travel had to deal with troublesome geopolitical events in a number of core destinations. Emphasis was placed on optimum capacity utilisation, resulting in a contraction in revenue at Hotelplan Suisse. Hotelplan UK, on the other hand, recorded organic growth in local currency terms, driven by the acquisitions of Explore Worldwide and Regaldive. However, the depreciation of the British pound eliminated some of this growth when converted into Swiss francs. The Holiday Home division has also grown. Overall, posted sales shrank by 3.0% to CHF 1'435 million, while net sales fell by 1.6% to CHF 1'284 million. This also includes sales already generated by bedfinder, a start-up within the Hotelplan Group aimed at selling travel services globally online.

Total income in the Financial Services sector amounted to CHF 827 million in the reporting year, with interest revenue of CHF 677 million or 81.9% constituting the main share of total income. The fall in income of CHF 38 million in total can therefore also be attributed primarily to lower interest revenue.