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FY20: Robust performance and accelerated investments in omnichannel and sustainability

In a year when home became even more central to the lives of the many, we have worked hard to meet the needs of our customers. To find more ways for them to shop with us; from mobile to web, through customer service or in-store.

Guided by our values and our focus on the wellbeing of our customers and co-workers – we have continued to perform and transform our business throughout a year like no other. We leave FY20 more resilient for the future, and as we continue our transformational journey, our vision to create a better everyday life for the many people is more relevant than ever before.

Read on to learn more about our year or download the PDF for an overview of our financial statements.

A message from Juvencio Maeztu, Deputy CEO and CFO Ingka Group

As Covid-19 has made life at home more important than ever, we accelerated our digital transformation, delivered solid sales and invested to become more affordable, accessible and sustainable.

The past year was dominated by the Covid-19 pandemic and its impact on people, communities and businesses, affecting our lives in ways most of us could never have imagined. For Ingka Group, it was first and foremost about securing the health and safety of our co-workers, customers and suppliers. But also, about making fast changes to accelerate our transformation to become an omnichannel retailer: improving our digital capabilities, repurposing our stores to fulfilment centres and increasing affordable services for safe pick-up and delivery. That way we could keep our business going, save jobs and meet our customers’ increasing online demand. At the same time, we continued to expand with new stores and city locations and new investments in innovative start-ups and accelerated our sustainability agenda. We want to be part of the solution to climate change, which is why we will continue to focus our future investments to ensure a cleaner, greener and more inclusive recovery from Covid-19.

Our performance at a glance

Total IKEA Retail sales*

EUR 36.7 billion

*IKEA Stores and channels owned and operated by the Ingka Group

Ingka Group net profit

EUR 1.8 billion

Visits to IKEA.com

2.6 billion

Visits to IKEA stores

839 million

Growth in online sales

48%

141 million IKEA Family members

Total IKEA Retail sales*

EUR 35.2 billion

*IKEA Stores and channels owned and operated by the Ingka Group

Ingka Group net profit

EUR 1.2 billion

Visits to IKEA.com

3.6 billion

Visits to IKEA stores

706 million

Growth in online sales

60%

151 million IKEA Family members

Our financial year FY20

In FY20, we completed the second year of our business transformation to make IKEA more affordable, accessible and sustainable. We entered FY20 with a strong starting position and sound underlying business performance in all three businesses (IKEA Retail, Ingka Centres and Ingka Investments) coupled with lower operational costs for running the business.

Despite the health and economic crisis due to the COVID-19 pandemic that resulted in the closure of the majority of our IKEA stores for several weeks, we’ve accelerated our digital developments and fulfilment offer.

  • IKEA Retail sales decreased by 4.1% to EUR 35.2 billion for 2020 (FY19: EUR 36.7 billion)
  • Ingka Group revenue amounted to EUR 37.4 billion (FY19: EUR 39.1 billion)
  • Net profit was EUR 1.2 billion (FY19: EUR 1.8 billion)

Click to read our full financial performance. 

IKEA Retail highlights

Top IKEA Retail selling countries

15%
Germany
13%
USA
8%
France
7%
UK
6%
China

Retail sales per region in %

71%
Europe
18%
Americas
11%
Asia and Pacific

Effective corporate tax rate (ETR) FY15–FY19

18.9%
FY15
21.6%
FY16
24.9%
FY17
30.0%
FY18
27.2%
FY19

374 IKEA stores / 30 countries / 49 smaller IKEA formats

Top IKEA Retail selling countries

15.6%
Germany
12.2%
USA
7.9%
France
6.2%
UK
4.8%
Italy

Retail sales per region in %

72.6%
Europe
16.5%
Americas
10.9%
Asia and Pacific

Effective corporate tax rate (ETR) FY16–FY20

21.6%
FY16
24.9%
FY17
30.0%
FY18
27.2%
FY19
24.1%
FY20

378 IKEA stores / 30 countries / 59 smaller IKEA formats

Highlights of our year

To succeed with the transformation of our business, we’re seeing strong movements in digital developments, store and meeting place transformations, city expansion, fulfilment services and sustainability initiatives. We’ve also accelerated our investments in innovative new companies and renewable energy to support our growth, business transformation and sustainability goals. Our aim is to become more convenient and more affordable for our customers, and more sustainable for our planet.

In March 2020, IKEA and Alibaba announced the opening of the virtual IKEA store on Alibaba’s e-commerce platform Tmall. The store will offer Chinese consumers access to around 3,800 IKEA products, and offer the same services provided as existing sales channels, including home delivery, assembly and product return. The partnership with Alibaba also enables IKEA to become more accessible for the many people in China and also allows it to test and learn how to meet customers in a new way. 

In April 2020, Ingka Investments, the investment arm of Ingka Group acquired Geomagical Labs, a leading US-based development company of 3D and visual AI solutions for interactive home furnishing inspiration, based in Silicon Valley, California. With Geomagical Labs onboard, we can bring our home furnishing expertise to many people in new ways and assist them in their unique design needs. In a time when people spend more time at home, we can support our customers with their everyday life through an enhanced digital meeting, making home or office design an inspiring and fun experience, while saving people valuable time in their creative design process.

In January 2020, Ingka Centres, part of the Ingka Group, acquired Kings Mall shopping centre in London, with plans to transform the shopping centre into the first IKEA-anchored urban, mixed-use destination in a downtown location. Co-creation with the community will ensure Kings Mall meets local needs, helps regenerate the Hammersmith area, and becomes a destination for everybody to meet, shop, socialise and relax. To stay relevant to our customers, the centre will incorporate modern physical retail needs and local community needs, alongside a complementary mix of uses, digitalisation and sustainability.

People & Planet Positive

We want to inspire and enable 1 billion people to live healthier and more sustainable lives within the limits of the planet by 2030. Our People and Planet Positive strategy has three focus areas:

  • Healthy and sustainable living. Inspire and enable more than 1 billion people to live a better life within the limits of the planet.
  • Circular and climate positive. Strive for zero waste, contribute to the IKEA ambition to be circular and climate positive by 2030, and advocate for positive change in society.
  • Fair and inclusive. Improve the well-being of millions of people by becoming a truly inclusive and people-centred company and employer.

This report provides the highlights of our people and planet positive initiatives for FY20, with full reporting being published as part of our Annual Summary in January 2021.

IKEA Home Solar in 7 countries

534 wind turbines and 2 solar farms in 14 countries

Half of our managers are women, as are more than half of our co-workers

IKEA Clean Energy Services in 11 countries

547 wind turbines and 2 solar farms in 14 countries

Half of our managers are women, as are more than half of our co-workers

Sustainability is at the heart of everything we do

Because we want to enable healthier and more sustainable living for millions of people; to accelerate the transition towards renewable energy; and to create a fairer, more inclusive world where more people can thrive. COVID-19 has reinforced the critical need to strengthen the resilience of our societies, the ways in which our economic systems function and the need to do it collaboratively – in any way we can. Together we inspire action and spark change to collectively build back better and create the future we all want to be part of.

In September 2019 Ingka Group acquired two solar parks in the USA, consisting of 400,000 solar panels – enough to produce energy for 50 IKEA stores. Other investments in renewable energy and sustainability technologies during FY20 include an 80% stake in 7 Romanian wind farms – generating more electricity than is used by the IKEA supply chain in Romania. We also invested in Winnow, an AI-enabled food waste tracking solution to help reduce food waste in commercial kitchens.

In February 2020 we announced that we were on track to achieve gender equal pay for work of equal value by the end of 2021 and in September 2018 we joined the Equal Pay International Coalition (EPIC) to manifest his commitment.

By the end of the same year, we rolled out a framework for gender equal pay in all countries where Ingka Group operates and over the past year, we have identified and performed concrete actions to address gender pay gap in areas like recruitment, co-worker development and succession.

In June 2020, IKEA Retail (Ingka Group) completed testing of two separate electric prototype vehicles in collaboration with original equipment manufacturers (OEMs) Renault and MAN. The tests, conducted in Paris and Berlin, are part of a wide range of efforts we’ve undertaken together with service partners and manufacturers to meet our 100% zero emission goal (100% electric last mile deliveries in all countries) by 2025.  Ingka Group is committed to tackling climate action and reducing carbon emission across our value chain. By offering sustainable home deliveries and encouraging uptake of electric vehicles or zero emission options among customers, we can contribute to the transition to a low-carbon economy and act as a good neighbour.