• Iceland reports full-year earnings of £150.5m
  • Like-for-likes slid 2.7% last year
  • Market remains “extremely challenging”

Frozen food specialist Iceland has posted flat full-year earnings and the rate of like-for-like sales decline has moderated.

The retailer generated adjusted EBITDA of £150.5m last year, compared with £150.2m the previous year.

Sales were £2.68bn in the year to March 26, similar to the £2.69bn in the year before.

Like-for-likes slipped 2.7% compared to a 4.4% fall the previous year.

Iceland founder and chief executive Malcom Walker said: “We have achieved good progress with a range of strategic initiatives designed to differentiate our business, and stabilise our financial performance, in what remains an extremely challenging market.”

Asked whether he feels threatened by Amazon’s newly-launched online food business, Walker told Retail Week: “That’s Ocado’s problem, not ours. I don’t underestimate Amazon in any way but the grocery market is different to general merchandise…it’s not something I’m bothered about.”

Over the last year Iceland has run a new ‘Power of Frozen’ marketing campaign as it looks to change the public’s perceptions of frozen food. Walker said the campaign was paying off. “We now sell more fish than anyone else in Britain. We’re Britain’s biggest fishmonger. Three or four years ago no-one was looking at scallops [in Iceland]; now they’re flying out.”

In the past year the chain  has invested in the construction of a product development centre and built its online capabilities as it has battled to adapt to a rapidly changing food retail landscape.

The retailer has also been rolling out a sister chain, Food Warehouse. Last year the number of Food Warehouse stores was doubled to 12 and this year 25 more are planned. The stores, which at 10,000 sq ft are twice the size of a typical Iceland branch, are on retail parks, where shopper numbers are better than on traditional high streets, and operate at a lower cost to sell than Iceland shops.

Walker said: “We see the future of the group in three principal, distinct and complementary business streams: our traditional Iceland stores and home delivery service, our growing online channel and The Food Warehouse.

”All three businesses will continue to benefit from our investment in the ‘Power of Frozen’ marketing campaign and new product development.”