Will SPAR withdraw from Hungary? Find out the answer here!
At a press event, Gabriella Heiszler, the CEO and President of SPAR, conveyed that the decision regarding SPAR’s withdrawal from Hungary rests with the owner.
According to Világgazdaság, the CEO also disclosed that the Austrian company once again suffered losses last year. Describing her conversation with Márton Nagy, she initially characterised it as tense but ultimately resolved on a more amicable note.
Gabriella Heiszler, CEO of SPAR, stated that the decision regarding the company’s presence in Hungary lies with the owner. This comes amidst tense relations between SPAR and the Hungarian government, triggered by accusations of state control and complaints about special retail taxes.
The Hungarian government against SPAR
Minister of National Economy Márton Nagy underscored the financial losses incurred by the supermarket giant, suggesting that continued operations in Hungary might not be viable in the long term. The government is contemplating legal recourse against the company in response to the allegations.
Gabriella Heiszler acknowledged that the popular chain experienced losses last year, akin to the previous year, although she refrained from disclosing specific figures. She did mention that the overall market turnover decreased by 8% last year, indicating that SPAR’s turnover decline was likely around half of that figure.
Regarding the retail sales tax, they remain optimistic about winning their case but anticipate a lengthy legal process. While the government intends to litigate against the company, no formal notification has been received thus far.
Gabriella Heiszler asserted that SPAR would be profitable were it not for the special tax of HUF 30 billion (EUR 76,174,320) remitted to the state treasury.
SPAR’s financial status in Hungary
Gabriella Heiszler highlighted the impact of the tax landscape and the special tax, emphasising the need for cautious spending. Despite facing increased turbulence, she underscored their commitment to projecting stability.
Heiszler subsequently presented last year’s results, hailing a notable milestone as the company’s turnover exceeded a trillion forints for the first time, reaching HUF 1,023 billion (EUR 2,596,869), signifying a growth of over 15% compared to the previous year.
The total area occupied by SPAR stores in Hungary stands at approximately 470,000 square meters. Heiszler acknowledged the hurdles in achieving substantial annual growth, partly attributed to challenges in opening new stores due to a mall freeze.
Furthermore, she noted that investment in new stores dwindled compared to the preceding year, amounting to only 22 billion Euros, resulting in last year being less prosperous in this regard.
In recent years, the relationship between the Hungarian government and the SPAR chain has deteriorated due to modifications in the tax framework and ongoing legal disputes. Nevertheless, despite these impediments, SPAR remains one of Hungary’s most popular chains, frequented by Hungarian citizens daily. Consequently, the notion of the chain exiting the country is unfathomable.
Read also:
- Hungary’s retail tax under fire: EU investigates discrimination claims by Austrian government and SPAR – HERE
- McDonald’s in Hungary: Popular fast food chain expands further in Hungary – HERE
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