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5. March 2022.With a turnover of HRK 6,03bn, Lidl occupies the second position in the food retail industry in Croatia, behind the market leader Konzum plus. It managed to further grow its top line even in the first pandemic year (+2,1%). In Croatia, the food retail industry is slowly consolidating, but the process has not yet seriously affected Lidl ‘s market position and Lidl continues to increase its market share at the expense of its competitors. In addition to its growth owed to store openings, Lidl continuously manages to increase its sales per store, which have grown from HRK 38m in 2015 to HRK 59m in 2021.
Lidl’s EBITDA margin in the period 2017-2020 was above 10%, while in 2021* it fell to 9,5% due to the weak tourist season and additional costs caused by the pandemic. However, Lidl’s cash flow generation ability is strong but is generally affected by the industry’s high capital intensity. Over the last six years, Lidl has opened 16 stores and invested HRK 1,9bn. In 2021, Capex was more than halved (-54%) compared to 2020, which had a positive effect on the FCF, rising from HRK 160m to HRK 369m. Despite the reduction in investment, Lidl’s expansionary policy continues. It is important to mention that the FCF generated over the last three years was not sufficient to cover the amounts returned to the owners in the form of a reduction in share capital. In the period 2019-2021, Lidl returned HRK 1,41bn to its owners, and at the same time Lidl borrowed HRK 599m to cover this gap. The level of debt is thus continuously increasing and the debt at the end of Feb-2021 amounted to HRK 1,06bn.
The Group’s policy is to allow direct borrowing by the operating subsidiaries, but in the case of the Croatian subsidiary, creditors required security in the form of real estate pledges and guarantees of four companies from the Group.
* Lidl’s fiscal year spans from March to February.
Company profile
Lidl Hrvatska is one of the leading food retailers in Croatia with sales of HRK 6,03bn and adjusted EBITDA of HRK 571m in 2021. Lidl Hrvatska is an operating subsidiary of the German-based Schwarz Group.
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