June 8, 2016 / 10:26 AM / 3 years ago

IKEA CEO says on track for 50 billion euro sales goal

IKEA Group CEO Peter Agnefjall speaks during a presentation on design to media in Almhult, Sweden June 8, 2016. REUTERS/Anna Ringstrom

ALMHULT, Sweden (Reuters) - Furniture retailer IKEA Group expects to grow sales about 8-10 percent in its current financial year, leaving it on track to reach its target of hitting 50 billion euros ($56.9 billion) in 2020, its top executive said.

“We are on that journey. That means we need to grow 8-10 percent annually to reach it and that is probably roughly where we’ll land this year,” IKEA CEO Peter Agnefjall told Reuters.

“We are well on track to realise the plans we have.”

Speaking on the sidelines of a design event in the small, southern Swedish town where IKEA first set up shop, Agnefjall said trends in demand remained similar to last year, with a continued recovery in its biggest market, Europe.

In China, a key growth market for IKEA, the company was little affected by a wider economic slowdown, he added.

“There has been talk for three years that China is slowing down. We don’t see those signs,” he said.

The company, known for its large warehouse-like out-of-town stores and flat-packed self-assembly furniture, reported a 11.5 percent sales rise to 32.7 billion euros in its previous fiscal year, which runs through the end of August.

Online sales at the home furnishing giant, which last fiscal year totalled about 1 billion euros, were expected to grow around 40 percent this year, roughly equalling annual growth in the previous three years, Agnefjall said.

In Russia, where IKEA once expanded rapidly, investments remained on hold, he said, while the company, which plans to open its first Indian store in just over a year, in Hyderabad, was close to finalising deals to buy land in New Delhi, Bangalore and Mumbai. ($1 = 0.8795 euros)

Reporting by Anna Ringstrom; editing by Niklas Pollard and Keith Weir

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