Spar Hungary loss jumps 40% in 2023

Spar Hungary Ltd. has previously provided some information of its performance last year, but the details have been made available only in their annual report published on Friday.

Spar's net sales increased 13.7% in the first quarter to HUF 882.7 billion from HUF 776.2 billion a year earlier. This is below the 17.6% annual average inflation rate.

More significantly, material expenses increased by 16.6% to HUF 744.6 billion. Of this, the largest item was the cost of goods sold (COGS), which amounted to HUF 547.3 billion.

This amount is proportionally higher than in 2022 (62% compared to 61.5%), which may also mean that the company has not been able to pass on entirely the price hike by its suppliers to its customers.

Personnel costs went up by 12.9% yr/yr to HUF 94.3 billion. Although this increase is lower than inflation, the company had fewer employees last year, 12,780 on average, compared to 13,210 in 2022, so the growth is higher than that, at least at the level of wages.

The company does not have a breakdown for manual and clerical workers, but

in 2022 the average salary was HUF 467,500, and last year it was HUF 548,200, i.e. the hike roughly matched the rate of inflation.

Typically, in an inflationary environment such as last year's, firms are more likely to give a greater raise in the lowest wage categories.

Spar's operating profit was HUF -12 billion, on top of which there was also a HUF 6.3 billion loss on financial operations, so last year they made a loss of HUF 18.3 billion, HUF 5.2 billion more than in 2022.

Spar paid taxes of HUF 35.1 billion, which supports Managing Director Gabriella Heiszler's previous statement that if it had not been for this, the company would have been profitable last year.

Cover photo: Spar