Iceland profits from meltdown

Frozen food chain Iceland is set to capitalise on the headwinds in the retail sector and the proposed merger of Sainsbury’s and Asda as it looks to snap up outlets for its Food Warehouse chain.

Richard Walker, Iceland’s managing director and son of founder and chairman Sir Malcom Walker, said the chain had “active and aggressive” plans for expansion of the division.

He said the firm was looking at all the “opportunities out there”, with a raft of troubled retail rivals shedding stores and the Sainsbury’s and Asda merger expected to see the pair forced to offload sites to appease the competition watchdog.

Iceland already has 66 stores under its fledgeling Food Warehouse brand, which combines a cash-and-carry format and its more traditional Iceland style, and Walker said it was planning to add at least another 30 each year.

He said: “We’re probably the fastest growing out there at the moment” – even beating sector disruptors and aggressive German discounters Aldi and Lidl.

Launched in 2014, the Food Warehouse stores – largely based in retail parks – are about three times the size of traditional Iceland outlets.

He said the raft of controversial company voluntary arrangement rescue deals being struck by the likes of Mothercare, Carpetright and New Look presented opportunities.

“Retailers are shedding space and we are looking at every one of those,” Walker added.

He is also expanding the core Iceland chain, which has 870 UK stores, with a few extra a year to “fill in the gaps”, as well as planning to grow the 20-strong chain in Ireland to 50 in the next couple of years.

Walker said that despite his expansion plans for Iceland, overall trading conditions remained tough for retailers.

“It’s as competitive as it’s ever been,” he noted.