The companies behind IKEA’s UK retail property and distribution services have both reported profit growth.
According to IKEA Properties Investments, which provides rental units for IKEA retail businesses, latest accounts for the year ended 31 August 2021, total sales dipped slightly by 2.5% to £88.1m from £90.4m in 2020. Pre-tax profit resulted at £175.9m, up from £68.2m.
Stated in its report, the company said that profit growth was largely due to the fair value gain in the investment property portfolio from the prior year at £98.9m.
“The increase in rental yields and coupled with strong demand for occupier market for assets has raised the value of our portfolio,” IKEA said.
The company added that the decrease in turnover was attributable to the closure of the Coventry store.
As for IKEA Distribution Services, which provides warehousing, distribution and logistics services to the supplier of the IKEA retail businesses, latest accounts for the same period, total sales rose 12.2% to £128.9m from £114.8m. Pre-tax profit resulted at £5.9m, up from £5.2m the previous year.
Stated in its report, the company, which operates a large distribution warehouse in Doncaster, a customer service centre in Peterborough and manages a subcontracted parcel unit in Corby and two warehouses in London, said that administrative expenses continued to rise alongside investments supporting its retail operations in the UK.