CONSHOHOCKEN, PA-- Global furniture giant IKEA Group says total sales grew 6.9% to €24.7 billion ($31.9 billion) in the fiscal year ended August 31, 2011. Based in Sweden, IKEA is the world's third largest consumer of wood after Lowe's and Home Depot.
While privately held IKEA BV is not required to issue results, it announced net profit increased by 10.3 percent to €2.97 billion ($3.83 billion), a result of increased sales and improvements in the cost structure.
IKEA said that despite a rise in raw material costs, it lowered retail prices 2.6 percent and improved quality. IKEA says it was able trim hundreds of dollars from some retail prices by flat packing, allowing it to ship more goods for less.
At IKEA US, headed by president Mike Ward, comparable store sales grew 7 percent in 2011, after rising 5 percent in 2010. There are currently more than 320 IKEA stores in 38 countries, including 38 in the U.S. IKEA manufactures globally through its Swedwood division.
IKEA says its U.S. stores thrived on larger seating configurations and home entertainment centers - a reflection of the consumer trend of cocooning at home. IKEA sats its research shows an average of 2.9 TVs in each American home, so the need for media solutions for flat screens as well as storage for digital games has increased.
"When nations and people face economic challenges, IKEA is more relevant than ever," says IKEA Group president and CEO Mikael Ohlsson. IKEA, which manufacturers through its Swedwood operations, opened seven new stores and added 4,000 employees last year.
On the green front, IKEA is investing $150 million in photovoltaic systems covering almost 85 percent of IKEA US roof tops. Existing solar panels on 11 U.S. units will generate 6,800 KW of electric power, provide anywhere from 20 to 70 percent of its electricity needs. IKEA US also completed its first Geothermal project with the opening of its 38th store near Denver, CO. it plants nearly 2 million trees across America with American Forests – to offset CO2. Last month IKEA announced the elimination of wooden pallets.
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