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Booming Ikea unshaken by Brexit as boss pledges to build more stores

Published 29/11/2016

Sales continue to rise despite uncertainty over Brexit, furniture chain Ikea reports
Sales continue to rise despite uncertainty over Brexit, furniture chain Ikea reports

Swedish flat pack furniture giant Ikea has reiterated its commitment to investing in Britain following the Brexit vote, as its sales continue their upward trajectory.

UK boss Gillian Drakeford told the Press Association the retailer "stands behind" the country's decision to quit the European Union, with plans for new stores still in the pipeline.

She said: "We stand behind the decision that has been made and we believe there is a lot of opportunity in the UK. We've been evaluating our newest stores and formats and yes, absolutely, there will be more stores. We will continue to invest in the UK."

Ms Drakeford was speaking as Ikea UK's full year results showed sales rose 8.9% to £1.72 billion in the year ending August 31, its fifth consecutive year of sales growth.

The number represents a slowdown on last year's 11.3% growth with Ms Drakeford saying it "gets a bit tougher each year".

The company opened a store in Reading earlier this year and plans to set up shop in Sheffield, Greenwich and Exeter. It is also trialling four smaller click and collect stores.

Ms Drakeford said that any new stores were dependent on the availability of sites and funding from the Swedish parent.

Asked if there had been any deterioration in trading as a result of the vote, Ms Drakeford said that although there was a climate of uncertainty, "consumers continue to shop our stores".

She said: "It's all very uncertain. We're staying close to the situation. Consumers continue to shop our stores and we're committed to taking care of them by investing in our stores and making shopping easier and convenient."

She said that Ikea UK was hedged against currency movements for a "period of time" and pledged to continue investing in price.

"Low prices is one of our cornerstones and we will continue to invest in price," she said.

Over the past financial year, Ikea's market share grew by 0.5% to 8.2%.

Ikea said sales were driven by a 17.7% rise in turnover at its cooking department and an 18.8% increase in mattress sales.

Online business rose 31% and now makes up 13.4% of sales.

Ms Drakeford said: "We launched a new website to provide an improved online experience for our customers as well as further connecting the online and offline channels.

"Our customers are increasingly using both channels to complete their purchasing journey so we've focused on ensuring this experience is as seamless as possible."

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