Ahold Delhaize Q3 Results Aided by Strong U.S. Performance
Ahold Delhaize has reported a healthy third quarter in the United States, thanks in large part to soaring ecommerce sales, and is anticipating that its makeover of the venerable Stop & Shop banner will lead to even more financial success.
Net sales reached €16.7 billion (US $18.5 billion) up 2.9% at constant exchange rates, while net consumer online sales were up 29.5% at constant exchange rates. In the United States, comparable-sales growth excluding gasoline was 1.8% and online sales growth accelerated to 26.3% at constant exchange rates in the third quarter.
“We saw a strong overall performance at our U.S. brands, particularly at Food Lion and Hannaford,” noted Frans Muller, president and CEO of Zaandam, Netherlands-based Ahold Delhaize. “Stop & Shop is operating in a challenging sales environment, but we are encouraged by improving transactions as we move into the fourth quarter. Our Reimagine Stop & Shop program is off to a good start, and we are pleased with the sales uplifts seen in the 21 remodeled Long Island stores, which are performing in line with our expectations."
Added Muller: “Comparable sales were strong in light of challenging prior-year comparisons. We were encouraged to see the two-year stacked comparable-sales growth accelerated to 4.5% in the third quarter of 2019, adjusted for weather, versus 3.3% in the second quarter of 2019, adjusted for both the strike and calendar shift impacts.”
He went on to say that the growth of Ahold Delhaize USA’s online business “[gave] us confidence that we can achieve over 20% growth in U.S. online sales in 2019.”
Muller also noted that in October, the company had met its goal of having more than 600 click-and-collect points in the United States by the end of the year, ahead of schedule, and that the company’s fresh kitchen and culinary innovation center in Rhode Island, created to test new fresh own-brand food concepts and process fresh fruit and vegetables, has opened.
Further, Ahold Delhaize’s Save for Our Customers program is now expected to deliver €600 million (US $663 million) in 2019, higher than its previous target of €540 million (US $587 million), the company is testing various forms of frictionless payment in both the United States and Europe, and it has unveiled a global goal to slash food waste by 50% by 2030 as part of the 10x20x30 initiative, which unites 10 of the world’s largest food retailers to work with 20 of their priority suppliers to halve food loss and waste by 2030.