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04 Business Review
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Strong e-commerce sales growth and store network expansion supported total revenue for IKEA which mostly offset challenges posed by COVID-19 on like-for-like sales.
Group Sales*
Group Profit †
*Including share of associates and joint ventures.
†Based on operating profit before effect of adopting IFRS 16 and share of results of associates and joint ventures, excluding selling, general and administrative expenses and non-trading items.
The world’s largest furniture retailer, IKEA, is operated by DFI Retail Group in Hong Kong, Macau, Taiwan and Indonesia. Renowned for design, functionality and quality at affordable prices, IKEA offers a comprehensive range of attractive home furnishing products, underpinned by a solid commitment to sustainability.
Challenges posed by COVID-19 severely impacted sales performance for IKEA with forced closures impacting stores in Taiwan and Indonesia, operating hour restrictions in Indonesia and limitations to dine-in services across all markets. In addition, global supply chain disruptions have led to continued challenges on stock availability, particularly top selling items. Despite these challenges, IKEA reports sales revenue of US$816 million, only 2% lower than the prior year.
E-commerce sales growth continues to remain strong, with double-digit percentage growth overall. In addition, IKEA continued to expand its store network in the year. In Indonesia, IKEA has more than doubled its store space following the openings of both the Bandung and Jakarta Garden City stores. In May, IKEA opened a larger replacement store in Neihu, Taipei City, which is almost double the size of the store that it replaced.
In Indonesia, IKEA more than doubled its store space following the openings of both the Bandung and Jakarta Garden City stores
‡ Including 100% of associates and joint ventures.
Operating profit was US$45 million for the year. The decline in profitability relative to the prior year was due to combination of lower like-for-like sales as a result of COVID-19 related disruptions, reduced availability due to supply chain constraints and higher pre-opening expenses for new stores.
In May 2021, IKEA opened a larger replacement store in Neihu, Taipei City, which is almost double the size of the store it replaced
