Lidl's Losses Grow While Kaufland Performs Well

The Czech Republic subsidiary of German-based discount mass grocery retailer (MGR) Lidl (owned by Schwarz) has posted a loss of CZK52.5mn (US$2.39mn) in 2007/2008, a 21.81% year-on-year (y-o-y) increase. While the company will no doubt prefer to be in the black, BMI believes that the second successive loss posting has much to do with the pace at which the retailer has expanded its footprint in the Czech Republic in recent years. It entered the country in 2003 and currently operates around 200 stores. We are forecasting the discount sector to grow in value by 50% through to 2013.

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