(Adds sector context in paragraph 2, profit margin in paragraph 3, outlook in paragraph 5, agreement with Mondelez in paragraph 7)
June 13 (Reuters) - Belgian discount supermarket chain Colruyt on Tuesday reported lower annual earnings, citing inflation and substantial cost increases that it has been unable to fully pass on to customers.
Under its "lower price" model, Colruyt said it can only pass on higher costs if all its competitors had raised prices, as the grocery sector struggles with elevated inflation.
Gross profit margin decreased to 27.1% of revenue in the fiscal year ended March 31 from 27.4% a year ago, the company said in a statement.
Colruyt, which competes with German retailers Aldi and Lidl, said its fiscal-year profit fell 30.4% to 201 million euros ($217 million) from 288 million euros a year earlier.
The group, which operates in Belgium, France and Luxembourg, estimated a significant rise in operating profit and net profit in fiscal 2023/24.
Jef Colruyt will remain chairman after July 1 when Stefan Goethaert becomes CEO and takes over his day-to-day management duties, the company added.
Colruyt, whose supply of Milka chocolate and Oreo biscuits had been halted in May due to a dispute over price increases with their maker Mondelez International Inc, said last week an agreement has been reached for supply to resume shortly. ($1 = 0.9268 euros) (Reporting by Diana Mandiá in Gdansk; editing by David Evans and Richard Chang)
