The managing director of Iceland has said that the frozen food chain had to put expansion plans on hold because of a rise in energy bills.
Richard Walker said the company’s latest energy bill had more than doubled to £20 million, which had left the group “fighting to keep the lights on”.
He told the Mail on Sunday that the company was feeling the effects of rapidly rising energy prices more than other retailers because of its reliance on storing food in fridges and freezers.
“We’ve got to make decisions because we have got this unmanageable volatility. In some instances, it might just be easier to mothball shops or temporarily close them because the energy costs are just completely unsustainable,” Walker said.
Iceland has only hedged its energy exposure for the next ten weeks, which leaves it facing a cliff-edge on costs. “We are good at selling frozen peas. We are not electricity traders,” he said
The company was founded Malcolm Walker, Richard’s father, in 1970, and in 1988 it bought its bigger rival Bejam.
Richard Walker has called for a cap on energy prices for businesses. “If you look at the spiralling energy markets, then you know it won’t stop there. We’ve got the winter coming and nothing is being done about it. Consumers rightly need to be supported, but business needs to be supported as well.”
He said that Iceland was large enough to handle tougher trading conditions ahead, but small and medium-sized suppliers were at a real risk of going bust, threatening thousands of jobs.