Ahold Delhaize Sees Q4 U.S. Comps Rise
In the year and a half since its merger, Ahold Delhaize has continued to make strides in a highly competitive grocery environment, including at its American banners, with Giant Carlisle and Food Lion singled out for particular notice in its fourth quarter of 2017.
The international grocer posted consolidated net sales of 15.8 billion euros for the quarter, a 1.6 percent increase at constant exchange rates compared with the year-ago period. The company’s net sales for the quarter grew 2.5 percent on a pro forma basis, at constant exchange rates, while for the full year, they were up 1.7 percent at constant exchange rates.
The company’s Q4 online net consumer sales increased 23.2 percent at constant exchange rates in the fourth quarter and reached 2.8 billion euros for the full year 2017.
According to Zaandam, Netherlands-based Ahold Delhaize, sales performance at Ahold USA was analogous to the previous quarter, with comparable sales edging up 0.6 percent, excluding gasoline, and slightly improved after adjusting for weather and holiday shifts versus the previous quarter. The company anticipates that market share will be stable compared with last year. Price inflation of 1.1 percent was broadly in line with the previous quarter. Giant Carlisle posted a strong quarter, with the division’s new Beer & Wine locations spurring more transactions.
At Delhaize America, comparable sales rose 1.5 percent, with both Food Lion and Hannaford reporting positive comps growth, and market share is expected to increase from last year. Food Lion continued to gain from the deployment of the Easy, Fresh and Affordable store makeover program in the Charlotte, N.C., market last year and the Richmond, Va., and Greensboro, N.C., markets this year. Price inflation of 0.7 percent was broadly similar to the previous quarter.
For the full year 2017, Ahold Delhaize said that it expected pro forma underlying operating margin for the group to be 3.9 percent, consistent with guidance. Additionally, the retail conglomerate anticipates free cash flow delivery to be considerably ahead of expectations, as a result of better working capital performance; capital expenditure to be slightly lower than forecast; and higher dividends from joint ventures.