Report by the Management Board

The REWE Group successfully concluded the 2022 business year and continues to develop at a steady pace. Our consistent approach and our broad and stable international structure have proved effective once again in light of the diverse impacts of the war in Ukraine. Total revenue increased to a high level – in part due to inflation – whereas earnings (EBITA) declined slightly year on year. The negative effects on earnings – the consciously calculated decline in food retail in Germany due to investment in customer prices, increased costs, e.g. for energy, raw materials, personnel and logistics, and targeted loss allowances for certain investments in associates – were offset by positive contributions from other Group divisions. The stable results were fuelled in particular by the marked revival in Travel and Tourism following the coronavirus pandemic, and also by the positive performance in international business and at Lekkerland. The REWE Group not only continued its investment strategy in 2022, but also reinforced it at a very high level.

Robust financial strength fuels successful further development

We are very satisfied with the economic development of our trade and tourism company in Germany and abroad. Our broad and international focus places us on stable financial ground despite the past three years of economic and socio-political extremes.

The REWE Group’s revenue increased by 10.4 per cent in the past financial year, from 76.8 to 84.8 billion euros. The Company grew by 8.2 per cent in Germany to 58.6 billion euros (2021: 54.1 billion euros), and abroad by 15.7 per cent (adjusted for exchange rate effects: 15.5 per cent) to 26.2 billion euros. Our workforce increased by 1.4 per cent to 384,239, with Germany accounting for a slight increase (+0.2 per cent) to 280,839, and other countries growing by 4.7 per cent to approximately 104,000.

With regard to development of revenue, earnings, liabilities, equity and investment, we are able to maintain our overall approach steadily through our own efforts.

Thanks to the marked recovery in tourism and healthy performance overall, we increased our investment in development of all business segments, despite the crisis, by a total volume of 2.8 billion euros.

Customers trust REWE retailers during the crisis – sales up by 6.4 per cent

Our independent REWE retailers were successful in what was a very difficult year for our customers financially; they increased sales by 6.4 per cent to 15.9 billion euros. They therefore are, and will remain, the driver of success at REWE.

REWE Group navigates crisis-ridden 2022 successfully

Revenue from continuing operations for the REWE Group – excluding independent retail and at-equity companies – increased by 11.3 per cent last year, from 69.4 to 77.2 billion euros. Revenue in Germany grew by 8.7 per cent to 51.3 billion euros, and abroad by 16.8 per cent (adjusted for exchange rate effects: 16.6 per cent) to 25.9 billion euros.

The operating result (EBITA) declined by 2.3 per cent, from 1.49 billion euros (2021) to 1.45 billion euros, and consolidated net profit fell by 33.4 per cent, from 755.6 to 503.5 billion euros.

Our consolidated earnings were shaped by two offsetting developments. The consciously accepted decline in food retail earnings in Germany (REWE and PENNY) due to investment in customer prices, increased costs for energy, raw materials, logistics and personnel, and targeted loss allowances for certain investments in associates were offset by other Group divisions, with a particular contribution thanks to positive performance in Travel and Tourism along with good progress in international business and at Lekkerland.

We also stepped up our investment activity despite the crisis. We increased investments in property, plant and equipment and intangible assets by around 520 million euros, from 2.3 to 2.8 billion euros.

The REWE Group is planning investments of 2.7 billion euros in the current year. Equity rose by 8.5 per cent, from 8.6 to 9.4 billion euros.

Revenue development in the REWE Group business segments and divisions

Revenue grew by 6.8 per cent to 37.4 billion euros in the Retail Germany business segment (REWE stores and PENNY). The Retail International business segment, comprising Austrian Full-Range Stores (BILLA, BIPA, ADEG), CEE Full-Range Stores (BILLA and IKI) and PENNY International, increased by 10.5 per cent (adjusted for exchange rate effects: 10.2 per cent) to 17.3 billion euros.

National Full-Range Stores achieved a revenue increase of 6.1 per cent to 28.4 billion euros. This included the retail sales of the REWE branches and wholesale revenue with retailers and other partners.

Revenue in the International Full-Range Stores segment (Austrian Full-Range and CEE Full-Range) increased by approximately 11 per cent to more than 11 billion euros. In the Austrian Full-Range Stores segment with BILLA, BIPA and ADEG, revenue rose by 4.2 per cent to 7.3 billion euros. CEE Full-Range Stores (BILLA and IKI) increased revenue by 13.4 per cent (adjusted for exchange rate effects: 11.5 per cent) to 3.5 billion euros.

PENNY Germany achieved a revenue increase of 8.9 per cent to 8.8 billion euros in 2022. With a virtually unchanged branch network of 2,135 stores, the number of customers rose significantly, by just under 11 per cent to more than half a billion.

PENNY International, operating in Italy, Austria, Hungary, Romania and the Czech Republic, increased its revenue by 16.7 per cent (adjusted for exchange rate effects: 16.9 per cent) to 6.6 billion euros. Taking account of exchange rates, PENNY grew the most in Romania, by more than 27 per cent, followed by Hungary and the Czech Republic.

The Convenience business segment, including the national and international business of the Lekkerland Group, grew by 4.2 per cent to 14.2 billion euros. In Germany, revenue from the REWE to go stores increased sharply by more than 11 per cent.

Revenue in the DIY Store business segment increased by 8.7 per cent year on year to 2.6 billion euros.

Invoiced revenue from Travel and Tourism increased significantly more than twofold year on year to 4.94 billion euros. Europeans rediscovered their love for travel in the summer of 2022 and returned in close to pre-pandemic numbers to tour operator DER Touristik. The DER Touristik Group recorded a very strong summer for travel across all source markets, in some cases actually in excess of 2019 figures.