Profit almost wiped out at Asda billionaire’s empire ahead of mega IPO
Profit at EG Group, the empire co-founded by a major investor in supermarket giant Asda, has almost been wiped out ahead of a planned $13bn float in New York.
The Blackburn-headquartered group was formed by brothers Mohsin and Zuber Issa and is now co-owned by private equity giant TDR Capital.
Now, new accounts filed with Companies House have revealed the group’s pre-tax profit was slashed from $1.4bn to just $10m in 2024.
EG Group said the change to its pre-tax profit was “largely driven by the material exceptional gain that the group reported following the divestment of the majority of the UK business in October 2023 and the profit from the USA sale and leaseback transaction which completed in May 2023”.
Before those exceptional items, the group made a pre-tax loss of $195m but it generated a profit of $205m from divestments.
In 2023, the group made a pre-tax loss of $125m before exceptional items which generated a profit of $1.5bn
The deal in the autumn of 2023 saw the group sell its remaining UK forecourt business and certain foodservice locations to co-founder Zuber Issa for £228m.
Following the deal, Zuber stepped down from his role as co-chief executive and became a non-executive director.
Mohsin Issa took over as sole CEO of EG Group but has recently been succeeded by Russ Colaco.
At the same time, Zuber sold his shares in Asda to TDR Capital, making the private equity giant its majority shareholder. Moshin remains a significant shareholder in Asda.
The USA deal saw the group sell and leaseback portfolio of its sites on the east coast to Realty Income Corporation for a gross consideration of approximately $1.5bn.
The results also show that EG Group’s revenue declined from $28.3bn to $24.1m over the year.
The group said its sales had declined as a result of the fall in fuel prices and the impact of its divestments over the past two years.
The results come after EG group issued a statement to the media in February in which it reported that its EBITDA (earnings before interest, taxes, depreciation and amortisation) had increased by nine per cent in 2024.
No other financial figures were released at the time.
The full accounts also come after it was reported at the end of 2024 that EG Group was working on plans to float its remaining business in New York in a move which would value it. at $13bn.
Asda backer Mohsin Issa hails ‘excellent performance’
In a statement released in February regarding its full-year results, Mohsin Issa said: “2024 was another successful year for EG Group. We grew full-year EBITDA by nine per cent on an underlying basis, with notable contributions from our USA and European businesses.
“This excellent performance is testament to the efforts and commitment of our 38,000 colleagues who continue to deliver great customer service across our grocery and merchandise, foodservice and fuel propositions each day, as well as our financial and operational delivery.
“We made significant progress with further reducing the quantum and price of our debt – bolstered by non-core divestments and the repricing of our EUR and USD term loans – and we are committed to further deleveraging in a disciplined manner.
“The actions we took last year have positioned us for further growth and together with our extensive portfolio of assets in nine countries globally, will provide a platform for us to maximise future growth opportunities to further strengthen our position as a leading independent convenience and fuel retailer.
“Looking ahead, we are well placed to progress as a business in 2025, and I look forward to working with our global team to deliver continued growth.”
Last month, EG Group revealed that its group underlying EBITDA fell by four per cent to $156m during the first quarter of 2025.
The group said this was due to “adverse weather in the USA impacting fuel and grocery demand and reduced availability of fuel in Germany following temporary refinery disruptions.