Five new stores push Lulu's Q1 revenue to $2.1bn, up 7.3% YoY
With five new stores and strong trading during the Ramadan period, Lulu Retail Holdings (Lulu) posted a strong set of numbers for the first quarter of 2025.
The largest pan-GCC full-line retailer's revenue grew 7.3 per cent year-on-year to US$2.1 billion, with EBITDA up 6.4 per cent to US$214.1 million. EBITDA margin was stable at 10.3 per cent, compared to 10.4 per cent in Q1 2024.
Net profit for the quarter reached US$69.7 million, up 15.8 per cent YoY, with net profit margin of 3.4 per cent, which was 25 basis points compared to Q1 2024.
Lulu posts strong Q1
During the quarter, Lulu opened five new stores, including in Makkah and Madinah. The company reiterated its target of 20 new stores during the full year 2025. It also reported strong growth in e-commerce sales, which was up 25.3 per cent YoY to US$93.4 million, or 4.7 per cent of retail revenue.
Saifee Rupawala, Chief Executive Officer of Lulu, commented: 'We are pleased to have demonstrated good growth in the first quarter of this year, with revenue up 7.3 per cent YoY. This was underpinned by a combination of like-for-like sales growth, supported by strong trading during the Ramadan period, and our store rollout programme, which remains well on track with five stores opened in the quarter.
'Lulu made good progress on delivering on our overall growth strategy, supported by robust sales in private label and e-commerce, which remain key components of our strategy.
'Looking ahead, we expect our growth momentum to continue as we remain focused on several initiatives under each of our four key pillars, including driving growth in our existing store network, opening new stores, operational efficiencies and delivering further upside through our private label and e-commerce offerings.'
Fresh food category revenue grew 7.9 per cent YoY in the first quarter, helped by the Ramadan period and improved consumption trends. Electrical goods category performed well, with revenue growing 29 per cent, mainly due to an increase in sales of higher-value items. Lifestyle products grew 6.9 per cent despite pressure as customers opted for more value products. Consumer Packaged Goods (CPG) sales was steady at +1.4 per cent.
The UAE, Lulu's home and largest market, recorded a mid-single digit revenue increase of 5.2 per cent, led by particularly strong performance in the fresh food segment, which grew 15.6 per cent YoY. This was supported by strong e-commerce sales in the country, which rose 40.1 per cent, supported by an increase in sales through aggregators.
In Saudi Arabia, revenue rose by 10.3 per cent, primarily because of new store openings in the last 12 months and strong LFL growth. Revenue in Oman was up 7.8 per cent, while it improved 6.7 per cent YoY in Qatar.
Gross profit increased 4 per cent to US$464.5 million, with gross margins reaching 22.3 per cent in the period, down 70 basis points compared to last year. This margin reduction was mainly due to promotional campaigns to drive higher footfall into Lulu stores during the festive period.
During the quarter, Lulu's net debt decreased to US$2.3 billion, which led to net debt/EBITDA improving from 3.2x in December 2024 to 2.9x at the end of Q1 2025.
Lulu opened two hypermarkets and three express stores, adding 22,339 sqm of retail space in the period, increasing the company's total retail space to 1.34 million sqm. The new stores included a hypermarket in Makkah and an express store in Madinah. It also opened two express stores in the UAE, and a hypermarket in Bahrain.
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