Aldi’s profits have fallen for the third year in a row, despite sales and market share doubling in just four years.
Operating profit slipped 17% to £211.3m, while gross profit was down 7% to £324.5m in the year to December 31, 2016.
Sales, which along with market share have more than doubled over the past four years, rose 13.5% to £8.744bn.
Aldi said profits were hit by investment. It ploughed more than £450m into prices and infrastructure during the year, opening new stores and improving its distribution centres in the UK and Ireland.
The discounter is operating in a tough UK market, fighting against a return to form by big four members Tesco and Morrisons and facing cost price increases – a particular problem for retailers with price at the heart of their proposition.
Aldi, which operates 726 UK stores, aims to reach 1,000 stores by 2022 and will open 150 stores next year under its Project Fresh initiative, creating more space for fresh, chilled and food-to-go ranges in an improved store environment.
Aldi UK and Ireland boss Matthew Barnes said: “Our growth is accelerating, thanks to the hundreds of thousands of new customers switching their shop to Aldi.
“We’re doing everything we can to insulate customers from those cost increases, making sure our prices are the lowest in the UK, every day of the year.
“At the same time, we’ve been improving the quality of our range and introducing the new products our customers have asked for.”
Aldi said that its best-performing categories were its Specially Selected premium range, in which sales for the current year rose 40%, fresh fruit and veg, fish and meat.
The discounter is currently focused on bettering its performance from last Christmas, when sales rose 15%, and has introduced 160 new festive products.