Ahold Delhaize limits strike damage

Ahold Delhaize

Despite the strike at American subsidiary Stop & Shop, Ahold Delhaize was able to limit the damage to its financial results. Dutch bol.com performed strongly, Belgian Delhaize less so.

 

Online growth

Ahold Delhaize has managed to raise its quarterly turnover by 1.5 % to 16.3 billion euros. According to expectations - but disappointingly - the underlying operational margin decreased to 3.6 % and underlying profit plummeted by 11.3 % to 594 million euros.

 

American comparable turnover suffered from an eleven-day strike at Stop & Shop, the company's most important chain in the United States. It still went up by 0.2 %, as other chains performed strongly - especially Food Lion - and online sales went up 29.2 %. CEO Frans Muller expects no financial damage from the strike in the second half of the year.

 

Dutch turnover went up 4.2 % to 3.7 billion euros, which was mostly courtesy of online store bol.com's 37.5 % growth. However, the operational margin went down to 5.2 % as investments in Albert Heijn's new concept (focusing on fresh produce) and in e-commerce proved costly.

 

Limiting costs

Belgian turnover remained stable at 1.29 billion euros, but the underlying operational margin went up to 2.9 % (from 2.7 %) as costs were successfully limited. Online sales went up 16.2 %, but offline did less well - except for the proximity stores Proxy Delhaize and Shop & Go. Investments for the second semester are focused on opening more stores.

 

The CEO also said the integration between Dutch Ahold and Belgian Delhaize is completed, resulting in a yearly 512 million euros in achieved synergies - slightly beating expectations. The new cost-cutting measures, grouped in the Save Our Customers programme, is hoped to earn the company a further 540 million euros.