Lulu Retail Holdings, operator of hypermarkets and mini-markets in the GCC, has reported higher sales for the last fiscal year, but promotions and investments dented the company’s margins.

The company’s revenue rose 4.1 per cent to US$7.9 billion in FY25, driven by a 2.3 per cent increase in like-for-like sales and new store openings.

Gross profit increased 3.3 per cent to $1.823 billion, but gross profit margin was 0.18 per cent lower, mainly due to promotional activity. 

Net income fell 5 per cent to $205 million, with net profit margin down 0.26 per cent, attributed to higher rent and staff costs associated with new store openings and increased commission payments to aggregators.

The company noted its e-commerce channel saw strong growth with a 38.6 per cent increase.

In terms of product categories, fresh food and electrical goods grew at a faster rate than overall sales, driven by high demand. The Lifestyle segment grew at a slower rate, as higher volumes were offset by market-led decline in prices.

By geography, the UAE saw the biggest revenue uplift of 6.4 per cent, followed by Kuwait (5.4 per cent), KSA (2.7 per cent), Qatar (2.1 per cent), and Oman (1.1 per cent).

Lulu had 20 new store openings during the year, taking its total to 267 stores, with 116 in the UAE, 65 in KSA, 32 in Oman, 24 in Qatar, 17 in Kuwait, and 13 in Bahrain.