Year-End Report, Axfood AB

· Axfood's consolidated sales amounted to SEK 33,115 m (32,428), an increase of 2.1%. Retail sales for Axfood’s wholly owned businesses in Sweden rose by 9.6% during the year. The increase for the fourth quarter was 7.6%.

· Operating profit for the period January–December was SEK 1,023 m (653). Operating profit for the fourth quarter was SEK 271 m (155), an increase of 75% compared with the same period a year ago. Willys, Dagab and Spar Finland made the strongest contributions to the earnings improvement.

· Profit after net financial items amounted to SEK 919 m (527), an increase of SEK 392 m.

· The fourth quarter entailed a slight improvement for Hemköp. The operating margin rose by 0.4 percentage points, to 2.2% (1.8%).

· Axfood's long-term operating margin target for 2005 has been raised to 3.5%.

· The Board of Directors proposes that the dividend be raised to SEK 5.00 (2.50) per share. The dividend policy is being changed to correspond to an average of 40% of profit after tax (previously a minimum of 30% of profit after tax during a business cycle).

About Us

Axfood AB conducts retail trade through the wholly owned store chains Hemköp, Willys and Willys hemma and wholesale trade through Dagab and Axfood Närlivs. In addition, Axfood collaborates with a number of proprietor-run stores that are tied to Axfood through agreements.

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