Axfood has signed an agreement with Witron to invest in automation equipment for the new logistics center that the Group plans to establish in Kungsbacka. The logistics center will ensure increased capacity and efficiency for the Group’s future growth in southern Sweden. The operation and ramp-up of the installation should start in 2030. The total investment contracted amounts to 265 million euros for the period 2026-2031.
In April, Axfood announced plans to establish a highly automated logistics center in southern Sweden. In August, the Group announced the signing of letters of intent with the German company Witron, market leader in dynamic warehouse and order preparation systems, and with the municipality of Kungsbacka to establish the logistics center in Frillesås. Today an agreement was signed with Witron. Axfood and Witron have been working together for several years since Witron provided the automation solution in the group’s highly automated logistics center in Bålsta.
The total investment contracted will amount to 265 million euros over the period 2026-2031. The investment body will be distributed as follows: approximately 15% in 2026, approximately 15% in 2028, approximately 40% in 2029, approximately 20% in 2030 and approximately 10% in 2031.
“I am pleased that we have now signed an agreement with Witron for the automation of the logistics center we are going to create. This solution will offer us a more flexible, more efficient and more sustainable logistics chain for the supply of products to our stores in southern Sweden, thus strengthening the competitiveness of the entire Axfood family,” comments Simone MarguliesPresident and CEO of Axfood.
Axfood also intends to enter into a long-term rental agreement for the logistics building, and discussions with potential owners are ongoing.
As previously reported, Axfood expects the cost level of the new logistics structure in southern Sweden, including the new lease and increased depreciation of the new logistics center, to be at the same level as the current cost level once fully operational. Thereafter, it is estimated that the level of costs will gradually decrease. More details regarding the financial effects will be communicated upon conclusion of the real estate lease contract.
The logistics center, which is expected to span around 90,000 square meters and be environmentally certified, will ensure the preparation and delivery of goods in all temperature zones to Axfood’s food retail stores, mainly in southern Sweden. The center is built to be well equipped to support the Group’s expansion plans with higher capacity and efficiency and a wider range of products. Operation and ramp-up of the installation should begin in 2030.
“It is very good to have reached this agreement for this strategically important automation solution. Thanks to the experience we have gained with Witron in Bålsta, we know that this technology will offer us the right conditions for the future and, as a natural step, we are confident to continue this journey also in the south of Sweden. This investment is fundamental to strengthen the future logistics structure of Dagab and Axfood and to continue to realize our ambition for market-leading efficiency,” says Hans BaxGeneral Director of Dagab.
In order to optimize logistics operations, the new logistics center will mainly manage store volumes intended for food retail and will mainly replace the existing warehouse in Backa. At the same time, the new logistics center is being built to handle the volumes currently handled from the warehouses in Jönköping and Hässleholm. Fruits, vegetables and flowers will continue to be shipped from the Landskrona warehouse. Overall, Axfood’s capacity with the new logistics center is expected to increase by at least 20 percent compared to the current volume in southern Sweden.
New financing agreement and currency hedging
The investment will be financed through a combination of operating cash flow and credit facilities. In July, Axfood concluded agreements with Handelsbanken, SEB and Swedbank regarding a new revolving credit line which replaces the previous one. The credit facility amounts to SEK 4,000 million, of which SEK 1,000 million has a maturity in July 2028 and SEK 3,000 million has a maturity in July 2030.
As part of the signing of the Witron agreement, Axfood will take currency hedges of 70 percent of future payment flows. The remaining part will be covered gradually until 2030.
For more information, please contact:
Alexander Bergendorf, Head of Investor Relations, Axfood, tel. +46 73 049 18 44
Sara Kraft Westrell, Head of Corporate Communications, Axfood, tel. +46 76 724 70 88
This document is an English translation of the Swedish original. In the event of discrepancies, the Swedish version will prevail.
Mincefood aspires to be the leader in affordable, good and sustainable food. Our family of companies includes the retail chains Willys, Hemköp and City Gross as well as Tempo, Handlar’n and Matöppet. B2B sales are managed through Snabbgross and our support company Dagab is responsible for product development, purchasing and group logistics. The Axfood family also includes Urban Deli as well as part-owned companies Apohem and Eurocash. In total, the group has more than 15,000 employees and a turnover of almost SEK 90 billion. Axfood has been listed on Nasdaq Stockholm since 1997 and the main owner is Axel Johnson AB. Learn more at www.axfood.com.
https://news.cision.com/axfood/r/agreement-signed-for-automation-in-axfood-s-new-highly-automated-logistics-centre-in-kungsbacka%2Cc4284501
PR 251219_Agreement signed for the automation of Axfoods’ new highly automated logistics center in Kungsbacka
Automation of the Dagab logistics center
Axfood Kungsbacka logistics center