FOOD WHOLESALER ADM Londis expects to spend up to €15 million before the end of 2008 acquiring new convenience stores for its symbol chain.
The expansion will be funded by bank debt, joint chief executive Stephen O'Riordan said yesterday.
Londis spent €15 million recently buying stores in Castlebar, Offaly and another location in the Midlands, Mr O'Riordan said. "These are stores with an established turnover that we believe will add substantial value to the group," he added.
ADM Londis yesterday reported pre-tax profits for 2007 of €6.1 million, a rise of 20 per cent on the previous year.
Mr O'Riordan said the strong profit growth was attributable to "leveraging our buying power further", and cost efficiencies achieved through the establishment of a new group support office and the greater use of technology across the business.
A net eight staff left its back-office operation during the year through voluntary retirement.
Its wholesale turnover increased by 4.5 per cent to €371 million.
Londis added 35 stores to its network last year, bringing its total to more than 370. These shops have a combined turnover of €761 million.
Mr O'Riordan said it expects to add 40 outlets in 2008 in spite of the slowdown in economic activity here. Much of this growth will be driven by a deal with Texoil to operate Londis stores on petrol station forecourts around the country.
But he warned that some level of consolidation was likely to take place in the sector and hinted that the Dublin area could be close to saturation in terms of the number of convenience stores operating in the city.
"Dublin city centre is having a more difficult time now than in the past," he explained.
Londis operates as a private plc with about 120 retail shareholders. The company yesterday said its shares are currently valued at €85.04, which represents a 7 per cent rise on a year earlier.
Shareholder funds increased by 24 per cent to €26.6 million.
Londis will this year spend €3 million on a marketing campaign to boost its brand, spearheaded by six new television advertisements and supported by radio and outdoor adverts.
